For three years, the KRG sold oil from the Kirkuk-Ceyhan pipeline. But the central government in Baghdad took over the Kirkuk oil fields after the Kurds threatened in September to seek independence.

But the Ovacik project has been shelved and an alternative pipeline plan — involving Iran — has emerged, marginalizing the proposed new pipeline to move oil from Kirkuk to Ceyhan.

Ankara had two basic expectations about the partnership. First, Turkish officials believed that a new pipeline would be built to carry oil from Kirkuk, Iraq, to Turkey’s Ceyhan oil terminal, replacing a damaged line and bypassing the KRG. And second, as an alternative to the border crossing from Habur, Turkey, into Iraq — which provides lucrative income to the KRG — a new border crossing to Iraq would open at Ovacik in Turkey.

On Oct. 16, Baghdad implied that the Kirkuk oil would be sent out via Turkey as in the past. The pipeline had been used irregularly during the battle against the Islamic State (IS), and Baghdad cut off the flow completely after the September independence referendum. Turkey expected the flow to resume — but it hasn't.

According to a Nov. 28 news report by the state-run Anatolian Agency, the Iraqi Oil Ministry decided to build a new pipeline that enters Turkey from Fish Khabur to replace a heavily damaged line. The 350-kilometer (217-mile) pipeline would have a daily capacity target of 1 million barrels and would start in Iraq's Salahuddin province, pass through Kirkuk and Mosul and reach Turkey at Fish Khabur. The existing line had become unusable during the IS occupation of Mosul.

However, Iran helped Iraq in its fight against the Kurds, and Iraqi Oil Minister Jabar al-Luaibi announced that Baghdad had signed an agreement to move Kirkuk oil through Iran. The deal calls for pumping 30,000-60,000 barrels daily through a proposed pipeline to the Iranian oil refinery at Kermanshah. Until that pipeline is completed, oil will be transported by tankers. Luaibi said in a Jan. 7 statement that transports will begin before the end of January with an initial capacity of 30,000 barrels a day.

There are five major oil fields in Kirkuk. The KRG was shipping daily to Turkey 300,000 barrels of oil it gets from the Havana and Bay Hassan fields through an alternative pipeline. Northern Oil Co., working for the Iraqi government, was pumping 150,000 barrels a day from wells in the three other fields. Luaibi recently said that, thanks to investments of foreign oil companies, they would increase the daily capacity at Kirkuk to 1 million barrels.

But although three months have passed, there has been no concrete development apart from news reports about the new pipeline.

The proposed border crossing at Ovakoy and the Kirkuk-Ceyhan pipeline project are linked. Either the Baghdad government forces will assume control of the route to the Turkish border or there will be a deal with the KRG. Today, though Mosul and Tal Afar are under the control of the central government, the route to Fish Khabur in the north is controlled by the Kurdish peshmerga. Government forces, after their initial advances, halted at the boundary of the disputed zone. Turkey, however, was hoping that the Iraqi army would ignore the boundary and assume control of the corridor as far as Fish Khabur.

The question to ask now is, was it the United States or Iran that stopped the Iraqi advance? Is Prime Minister Haider al-Abadi stalling to see the outcome of negotiations with the KRG?

Turkey’s fervently pro-government daily Yeni Safak asked Jan. 8, "Who is blocking the Ovakoy crossing project?"

“The Ovakoy border crossing, planned for a new trade route to Baghdad, has always been subject to barriers because it would intervene with the corridor plans of terrorists," the report said, referring to the PKK and some possible IS cells. "Today this project faces the risk of being shelved again.”

The newspaper wrote that Turkey initially had planned to open the Ovakoy crossing during the reign of Saddam Hussein, but coalition planes taking off from Incirlik Air Base had fired on children playing soccer on the proposed route, thus killing the project. This was the newspaper’s way of insinuating US involvement.

A diplomatic source told Al-Monitor, “The plan to open the Ovakoy crossing is proceeding slowly because the land on the Iraqi side of the crossing is not yet under full control of the Iraqi government. It would be unfair to blame Iraq for lack of political will for the project. We will see how sincere they are only after they assume control of the land on their side. They are now asking for bids for a new pipeline on the Kirkuk-Ceyhan course. Real progress on this project will depend on Turkey’s serious approach and interest.”

The diplomatic source said allegations of US and Iranian interventions are “speculations that have to be kept in mind.’’

“Sure, Americans want restrictions on Haider al-Abadi," he said, referring to Abadi's ties with Tehran. "Americans are not dealing honestly with anyone in the region, not only with Turkey. Meanwhile, Iran seeks to expand its influence from the Iraq-Syria border to Kirkuk. Abadi is not under pressure, because he got what he wanted," which was control of the disputed areas. "He doesn’t want to challenge anything and endanger his election aspirations,” the source added.

Turkey had said it was ready to proceed with both projects. But we have to remember that Turkish Prime Minister Binali Yildirim had declared Iraq had taken full control of the Habur crossing, and Anadolu Agency reported the same Oct. 31. Minister of Customs Bulent Tufenkci had said “this is good news” and confirmed operations at the crossing had resumed their normal pace. Turkey’s other compliant news media also reported Iraq had retaken control of the crossing.

However, Al-Monitor’s diplomatic source said recently, “Unfortunately the Habur crossing is not under government control. The Iraqi chief of staff arrived at Habur with a delegation and staged a show of force. But both sides are still negotiating whether there should be 'sole Iraqi control' or joint management by Baghdad and the KRG.”

Reuters reported both sides were meeting Jan. 15 to negotiate KRG border controls, as well as oil, customs revenue and other issues.

Turkey had generally followed a balanced approach to Iran in Iraq. In parallel with tensions with the United States on various issues, Turkey moved closer to Tehran — as last seen by Ankara’s opposition to the US support for demonstrators in Iran. This Turkish attitude could well soften the competition with Iran over Iraq. But it is not yet clear whose counsel Abadi, who pursues a balanced policy between Tehran and Washington, is heeding when it comes to Turkey’s demands. This is very much open to speculation.