Iraq Gets Court Order Seizing Kurdish Crude Off Texas
By Laurel Calkins and Dan Murtaugh Jul 29, 2014 12:17 PM ET
Iraq persuaded a U.S. judge to order the seizure of $100 million of oil inside a tanker anchored off Galveston, Texas, that it claims was illegally pumped from wells in Kurdistan.
Kurdish officials misappropriated more than 1 million barrels of oil from northern Iraq and exported them through a Turkish pipeline, according to a complaint filed yesterday in Houston federal court. U.S. Magistrate Judge Nancy Johnson in Galveston authorized U.S. marshals to seize the cargo and have it moved ashore for safekeeping until the dispute is resolved.
The U.S. officially recognizes Kurdistan as part of Iraq, although the Kurdish people have jockeyed with the Baghdad-based national government for autonomy for more than a decade. Oil revenues from the northern oil fields could fuel Kurdistans fight for independence.
Either theyll bring the oil into port, where well take possession of it, or theyll sail off somewhere else, Phillip Dye Jr., a Houston-based attorney for the Iraqi Oil Ministry, said in a telephone interview today. His clients dont know who bought the cargo, and he said he had no reports that any oil has been removed from the tanker yet. In a separate court filing, AET Inc., a lightering services firm, identified Talmay Trading Inc. as the company that hired it to transfer the crude.
The Iraqi government warned Kurdish officials to stop the illegal exporting through Turkey, which began in December, according to the complaint. The crude shipment left Ceyhan, Turkey, on June 23, and has changed destinations multiple times while at sea, according to the filing. The ship is anchored about 60 miles southeast of Galveston, according to data compiled by Bloomberg, outside U.S. territorial waters.
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