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ECONOMICS > Halkbank to keep processing energy payments to Iran: Deputy PM

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Halkbank is to continue mediating Turkey’s gas and oil payments to Iran, Deputy PM Ali Babacan said.  DAILY NEWS photo

Halkbank is to continue mediating Turkey’s gas and oil payments to Iran, Deputy PM Ali Babacan said. DAILY NEWS photo

Deputy Prime Minister Ali Babacan has said Turkish state-owned lender Halkbank, whose chief executive was arrested in connection with the graft investigation, is to continue mediating Turkey’s gas and oil payments to Iran.

“The state of Iran has accounts with Halkbank and we deposit the payments for the oil and gas purchased into these accounts [...] Halkbank will continue to carry out this function,” Babacan said Jan. 8 during an interview broadcast on Bloomberg HT Television.

Babacan also noted all transactions made through that account were under control of the state of Iran.

The transfer of gold and money to Iran via Halkbank is under scrutiny as part of the corruption investigation launched on Dec. 17, charging businessman Reza Zarrab with forming a ring that bribed officials, including Halkbank chief executive Süleyman Aslan, to help disguise illegal gold sales, former Economy Minister Zafer Çağlayan and former Interior Minister Muammer Güler.

Zarrab, Aslan and sons of two ministers are still under arrest.

Halkbank has repeatedly said its dealings with Iran are entirely lawful, but its Iranian business ties had drawn Western criticism amid U.S.-led efforts to curb Tehran's disputed nuclear program.

Turkey has bought natural gas and oil from Iran through an indirect system whereby Iranian exporters received payment in Halkbank lira accounts and used that money to buy gold. The bulk of that gold was then been shipped from Turkey to Dubai, where Iran could import it or sell it for foreign currency.

Halkbank said last month that the gold sales had stopped on June 10, in line with a July ban. Since then, sources say, Iranians have bought mostly food and medicine with the funds.

Babacan also touched upon the ongoing issue of where to collect Kurdish oil money, reasserting that the Turkish government insisted on accumulating the money to be paid for oil from the Iraqi Kurdish oil at Halkbank.

Some sources had claimed revenues from Kurdish oil, which is to be exported to world markets via Turkey, would be deposited in a New York-based bank account of the Development Fund of Iraq (DFI).

Anadolu agency had reported the decision to collect money in a U.S. bank was agreed by Iraqi Prime Minister Nuri al-Maliki and Kurdistan Regional Government (KRG) Prime Minister Nechirvan Barzani, during a meeting on Dec. 25 in which they had reached a resolution over their differences on oil exports.

“It is true three are different ideas from the other side but we say we will put the money in this [Halkbank] account. After we put the money, they have the control to decide what to do,” Babacan said.

Turkey signed a multibillion-dollar energy package late last year with the KRG, which will see the rich hydrocarbon resources of the semi-autonomous region independently exported via Turkey.

Turkish Energy Minister Taner Yıldız said Jan. 2 that crude oil from northern Iraq had started flowing to the Turkish Mediterranean export hub of Ceyhan, adding that he hoped authorities could begin shipping the resource by the month’s end, pending Baghdad’s approval.

January/08/2014

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