Iraqi MP: Kurdistan Government Oil Law Didn't Help

September 7, 2007

BAGHDAD - A top Iraqi parliamentarian said the Iraqi Kurdistan approval of a regional oil law set back the debate over a federal law.

Abdul-Hadi al-Hasani, deputy chair of the Parliament's Energy Committee, said the deals the Kurdistan Regional Government (KRG) signed with oil firms could be overturned by the federal government.

Iraq's federal oil law has been held up by disputes over the extent of federal control over the oil sector and what role the private sector would play.

The Kurds, in the relatively peaceful Kurdistan region in the north, have been urging movement as they try to capitalize on four plus years of economic development. They have signed a handful of oil deals with smaller, private firms, which raised ire in Baghdad, sparking threats from the Oil Ministry they wouldn't be honored.

Last month the KRG grew weary of waiting for Baghdad and approved its own version of a regional oil law, saying it would be in line with a version of the federal law the KRG agreed to in February.

"It did not help as much as hindrance," Hasani said on the sidelines of the Iraq Oil, Gas, Petrochemical and Electricity Summit organized by the London-based Iraq Development Program. "We need one constitution, one law over everybody. It could wait and then we could see and then they could adopt the law which everybody had agreed on."

Hasani claims the federal government has the right to void the KRG contracts, though that would likely make matters worse in terms of the investment scene in Iraq.

Sami al-Askari, parliamentarian and top adviser to the prime minister, said a federal oil and gas council that the law forms would decide whether to scrap the KRG deals.

Both parliamentarians said the private firms that signed deals with the KRG should not be blocked from winning contracts for the rest of Iraq.