Britain’s secret ties to governments, firms behind ISIS oil sales

Nafeez Ahmed
Jul 31, 2015 · 21 min read

This exclusive is published by INSURGE INTELLIGENCE, a new crowd-funded investigative journalism project

The story was originally commissioned by London’s Middle East Eye, which has published an abridged version available here



Kurds, Turks and blind eyes

One of ISIS’ most significant sources of revenue is oil smuggling. The Islamic State controls approximately 60% of Syria’s oil, and seven major oil-producing assets in Iraq.

Complicity

KRG and Turkish authorities vehemently deny any role in intentionally facilitating ISIS oil sales. Both governments have taken measures to crackdown on smuggling operations, and US and UK authorities work closely with the KRG to identify ISIS smuggling routes.

“Elements of the KRG and Peshmerga militia directly facilitated secret ISIS oil smuggling through the Kurdish province. This was known to the Americans, which shared intelligence on the matter with the Iraqi government in Baghdad.”

The issue inflamed tensions between Baghdad and the KRG, contributing to efforts by Hussein al-Shahrestani, then Iraq’s deputy prime minister for energy affairs, to crackdown on independent Kurdish oil exports.

“Turkey has sponsored Islamist groups in Syria, including ISIS, since the beginning, and continues to do so. The scale of ISIS smuggling operations across the Turkish-Syrian border is huge, and much of it is facilitated with the blessings of Erdogan and Davitoglu, who see the Islamists as the means to expand the Turkish foothold in the region.”

Recep Tayyip Erdogon is the President of Turkey, and Ahmet Davutoglu is the country’s Prime Minister. Asked how this fits with recent Turkish operations to shut-down ISIS smuggling operations and target ISIS strongholds across the border, the source described the actions as too little, too late.

A shadow network in broad daylight

The ISIS oil smuggling route — which encompasses the KRG and ends up at the Turkish port of Ceyhan — was recently investigated by two British academics at the University of Greenwich.

“… extraction wells in the area of bombardments have yet to be targeted by the US or the air-assets of its allies, a fact that can be readily attributed to the at times ‘toxic’ politics in the Middle East.”

Despite large convoys of trucks transporting ISIS oil through government-controlled areas in Syria, Iraq and Turkey, “allied US air-raids do not target the truck lorries out of fear of provoking a backlash from locals.” As a result, “the transport operations are being run efficiently, taking place most of times in broad daylight.”

The public record

Evidence already in the public record corroborates the allegations of the Iraqi and Turkish sources, showing that corruption is endemic at both the origin and end-points of the ISIS smuggling route.

The Nokan Group

Instead, a couple of months after the committee had reached its conclusions, evidence emerged that the Nokan Group, a major Kurdish company with close ties to the KRG, had been directly facilitating ISIS oil sales.

Photograph enclosed with Ambassador Wallace’s letter to the Nokan Group, extracted from various media reports

Corruption, Nokan and the KRG

The Nokan Group is a conglomerate of companies owned and controlled by the Iraqi Kurdish political party, the Patriotic Union of Kurdistan (PUK), which is one of the KRG’s ruling parties alongside the majority KDP.

The British connection

A British energy company with strong backing from the UK political establishment operates the oil field supplying the Nokan-owned Bazian refinery.

“Across the Kurdistan region, business is flourishing… and people are keen on British and foreign investment. Privatisation continues apace and huge property complexes are being built. There are significant oil and gas reserves, which, unusually in these parts, are used for the benefit of the country, not salted away in corruption. As I pointed out in an early-day motion [tabled with Zahawi and others]… the KRG can become an important ally in guaranteeing the UK’s future energy security.”

In January 2015, as the UK parliamentary Foreign Affairs Select Committee released its inquiry report, Zahawi was back in the KRG as part of an official UK trade delegation led by Mayor of London Boris Johnson, recently appointed to the Prime Minister’s political cabinet.

Fracturing Iraq for oil

Although the KRG launched its investigation of ISIS terrorism financing by Kurdish officials while the British parliamentary inquiry was still ongoing, the inquiry report makes no mention of it, nor does it acknowledge that the KRG investigation had confirmed the allegations nearly a month before publication.

“European energy security will gain from their ability to supply gas through the projected southern energy corridor for a century. This deserves UK recognition and support.”

The eagerness of American and British oil companies to exploit Iraqi Kurdish resources, however, raises urgent questions as to whether US-UK government support for the KRG-Turkish oil nexus is undermining the war on ISIS, if not fuelling the terror group.



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Nafeez Ahmed

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Systems journalist. Crowdfunding investigations: http://patreon.com/nafeez

INSURGE intelligence

We are crowdfunding adversarial investigations into power, to empower people and save the planet. Join us via www.patreon.com/nafeez