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Mon 21 Sep 2009 11:32 PM

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Turkey eyes term extension on Iraq oil pipeline deal

Turkish Minister of Energy plans to fly to Baghdad next month to discuss agreement.

Turkey’s Minister of Energy and Natural Resources, Taner Yildiz, confirmed on Monday his country is in talks with Iraq on extending the term of their agreement on the Kirkuk-Ceyhan oil pipeline to 20 years beyond its expiry date.Agreement on the 980 km-long pipeline, which carries crude oil from Iraq's northern region of Kirkuk to Turkey's Mediterranean port of Ceyhan, expires in mid-2010, Yildiz told reporters in Ankara.

The minister said he planned to fly to Baghdad in October to discuss the issue with Iraqi leaders, KUNA reported.

The Kirkuk-Ceyhan Oil Pipeline is Iraq's largest crude oil pipeline for exports. Although it has a projected capacity of 1.5 million barrels per day (bpd) it has never reached this level since its launch in the late 1980s, the agency added.

Yildiz told reporters he is against the idea of launching a new parallel pipeline because the exisiting one will be sufficient to meet needs when used to its full capacity. At present it is only operating at 18 percent of capacity.

The objective is to ramp up production to 1 million bpd within three to four years.

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