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Baghdad to exclude oil firms with KRG deals

Baghdad, November 15, 2007

Iraq's oil minister said oil firms which have signed contracts with the Kurdistan regional government (KRG) in northern Iraq would be barred from doing deals with the central government.

"Absolutely, we are considering that and we are already writing to some of the companies the consequences of their actions," Hussain Al Shahristani said when asked if Baghdad would exclude those firms.

Al Shahristani, who is in Riyadh to attend an Opec heads of state summit on November 17-18, declined to name the companies, saying, "You will hear."

The KRG has pushed ahead with plans to attract foreign firms to develop its oil and gas despite opposition from Baghdad, which says the new contracts are illegal.

On Monday, the regional government in Iraq's semi-autonomous Kurdistan said it had warded five new petroleum production sharing contracts to foreign firms, further angering Iraq's central government.

The KRG said the deals were with affiliates and subsidiaries of TNK-BP, Korea National Oil Corp (KNOC), Hillwood, Sterling Energy and Aspect Energy, although TNK-BP denied any involvement.

Kurdish officials have clashed with Baghdad over Kurdistan's oil deals and the content of the national oil law, which will determine how contracts are awarded and how revenues are distributed from the world's third-largest proven oil reserves.

The oil law, one of a number of key political benchmarks identified by Washington as critical for national reconciliation, was to have been passed by the middle of this year but remains stalled due to political infighting.

Frustrated by the delays, Kurdistan passed its own oil law in August. Baghdad rejects that law. Reuters




Tags: Saudi Arabia | Opec | Iraq | KRG |

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