http://www.boston.com/dailynews/348/world/Turkish_company_to_drill_for_o:.shtml

Turkish company to drill for oil in northern Iraq

By Selcan Hacaoglu, Associated Press, 12/14/2001 10:36

ANKARA, Turkey (AP) A Turkish state oil company has won a U.N.-approved contract to drill for oil in northern Iraq, the company announced Friday.

Turkey and Iraq have held intermittent talks for three years on drilling in the Khurmala oil field. The deal also signals growing trade ties with Iraq ties that Turkey fears could be damaged if the United States expands its anti-terror campaign to Iraq after Afghanistan.

''This is a sign of our improving relations with Iraq,'' said Mete Gurel, deputy manager of the state-run Turkish Petroleum Corp. by telephone. ''We absolutely don't want our relations damaged.''

Turkish Petroleum International Co. Ltd., a sister company of the Turkish Petroleum Corp., will provide drilling services for 20 wells in the Khurmala oil field together with the Iraqi state company, North Oil Co., a statement from the Turkish company said.

Russian and Chinese companies are extensively cooperating with Iraqis in its northern oil fields.

Most of northern Iraq has been controlled by opposition Iraqi Kurdish factions since the 1991 Gulf War, but the Khurmala field is controlled by the government in Baghdad, Gurel said.

The United Nations approved the drilling agreement on Oct. 5, the company said.

Iraq was one of Turkey's major trading partners before the Gulf War. Turkey estimates that it has lost between $30 billion to $40 billion from lost trade and the shutdown of an Iraqi-Turkish pipeline.

In 1996, Turkey reopened the pipeline and has been trying to improve its trade relations with Iraq since. But Turkey's hosting of U.S. warplanes, which enforce a no-fly zone over northern Iraq, is a point of friction between the countries.

-- Anonymous, December 14, 2001