Türkiye is seeking to extend pipeline infrastructure to transport oil and natural gas from Iraq and the Gulf to Europe, according to Energy and Natural Resources Minister Alparslan Bayraktar.

Ankara and Baghdad signed on Saturday a one-year deal on maintaining the use of the crude oil pipeline running from Kirkuk in northern Iraq to the Turkish Mediterranean port of Ceyhan.

The agreement extended a decades-long bilateral arrangement that expired last week and that allowed the operation of Baghdad's only functioning export ⁠pipeline, the Iraq-Türkiye Pipeline.

The deal comes as Iraq moves to strengthen the resilience of its oil export infrastructure following disruptions to shipping through the Strait of Hormuz since the U.S.-Iran war began in February.

The extension allows time for talks on a more comprehensive ⁠agreement between Türkiye and Iraq covering cooperation in the oil, electricity and water resources sectors.

Türkiye wants the pipeline, with a capacity of 1.5 million barrels per day (bpd), to be fully utilized ⁠and possibly extended to southern Iraqi oil fields.

One project under consideration is a pipeline that would connect southern Iraq's Basra to western Haditha and from there to the Ceyhan port in Türkiye and the port of Baniyas on Syria's coast.

The Iraq-Türkiye pipeline has been largely idle since 2023 after exports from Iraq's semiautonomous Kurdistan Regional Government (KRG) region were halted following legal and commercial disputes, although flows through it resumed in a limited capacity last year.

The new deal provides for a minimum export volume of 750,000 barrels of Iraqi crude per day to Ceyhan, where some volumes would be processed in Turkish refineries while the remainder would reach international markets.

The pipeline was last carrying around 200,000 barrels per day. Bayraktar said it could eventually be expanded to between 2 million and 2.5 million barrels per day.

According to Bayraktar, Türkiye is proposing a new crude oil pipeline stretching from Silopi on the Turkish border to Iraq's Basra.

The minister argued that expanding alternative export routes has become increasingly important amid security concerns surrounding the Strait of Hormuz, through which roughly 20 million barrels of oil per day transited before the conflict.

He said additional capacity through Türkiye would provide producers in Iraq and Gulf countries with an alternative export corridor should disruptions occur in the region.

The minister also said the expanded corridor could support storage, refining and petrochemical investments around Ceyhan while helping finance the planned Development Road transport corridor linking Iraq's Grand Faw Port with Türkiye and Europe.

All energy routes 'converge in Türkiye'

Bayraktar said negotiations with Iraq were also centered on natural gas cooperation. The sides are also discussing expanding electricity exports from Türkiye to help address Iraq's power shortages.

In the near term, Türkiye could use its existing infrastructure to export gas to Iraq to help fuel Iraqi power plants, said Bayraktar.

Over the longer term, Ankara is proposing construction of a gas pipeline alongside the planned Basra oil pipeline and electricity transmission lines, he noted.

The project would allow gas produced in Qatar and other Gulf countries to flow north through Iraq into Türkiye and onward to European markets.

"Our larger project is to build a natural gas pipeline alongside the oil pipeline extending to Basra so that, in the future, Qatari gas and other Gulf gas can reach Türkiye through Iraq and then continue to Europe," Bayraktar said.

That, he said, would establish a "global hub" where all energy routes "converge in Türkiye."

He added that Türkiye's existing energy infrastructure, including more than 20,000 kilometers of high-pressure natural gas transmission pipelines, 220,000 kilometers of distribution networks, LNG terminals and underground storage facilities, provides the foundation for becoming a regional energy transit and trading hub.

Under a separate agreement signed on the sidelines of Iraqi Prime Minister Ali al-Zaidi's visit to Ankara last week, state-run energy company Turkish Petroleum Corporation (TPAO) acquired a 15% stake in a consortium operating in Iraq's Kirkuk region.

TPAO will join BP and ConocoPhillips in developing the Baba and Avanah domes and the Bai Hassan, Jambur and Khabbaz fields.

The Kirkuk project contains an estimated 3 billion barrels of recoverable oil reserves, representing an economic value of roughly $250 billion at current prices, said Bayraktar.

The wider contract area is believed to hold resource potential of up to 20 billion barrels of oil equivalent.

According to the latest field-level production data published by Iraq's Extractive Industries Transparency Initiative (EITI), the fields currently produce around 300,000 barrels of oil per day.

Bayraktar said there was a long-term production potential of up to 1.2 million barrels per day.

The recent deals, the minister said, go beyond upstream oil development and form part of a broader strategy to diversify regional energy routes at a time of heightened geopolitical uncertainty.

"The world is entering a new normal characterized by persistent conflicts, and energy infrastructure has become a primary target," Bayraktar said.

Bayraktar reiterated the government's ambition to turn TPAO into an international producer capable of reaching 1 million barrels of oil equivalent per day.