Not impressed: Prime Minister of the Kurdistan Regional Government Nechirvan Barzani
Kurdistan rejects Baghdad round
The Prime Minister of Iraq's largely autonomous Kurdistan region Nechirvan Barzani condemned today plans by the country's Oil Ministry to auction six fields in a two-day tender next week for service contracts, saying they violated the constitution.
A row between Kurds and the central government in Baghdad over control of Iraq's oil reserves, which has seem both sides refuse to recognise each other's dealings with foreign companies, is part of a wider struggle over power and land that analysts claim is the greatest long-term threat to Iraq's stability as the US plans to withdraw combat forces from Iraq by the end of August 2010.
Oil Minister Hussein Shahristani plans to announce the results of a first bidding round to international companies seeking a stake in the country's reserves over the last two days of this month.
Two gas fields are also on offer.
"This auction is a violation of Iraq's federal constitution ... the proposed Oil Ministry contracts are not in the best interest of the Iraqi people," Reuters quoted Barzani as saying in a statement posted on the Kurdish Regional Government (KRG) website.
Two of the oilfields, Kirkuk and Bai Hassan, are in territory that is disputed between Baghdad and Kurdistan.
The Kurds claim the Oil Ministry has no right to tender these fields until that dispute is resolved.
"Any decision related to contracting for Kirkuk and Bai Hassan fields requires the direct involvement of the KRG as a party to the dispute," Barzani said.
"Regrettably, the KRG has not been involved."
He added that any oil companies who invest in the disputed territories would been considered to have broken Kurdistan's own oil and gas law.
Baghdad has similarly rejected deals that the Kurds struck with international oil companies and threatened to exclude them from its bidding rounds, although last month they reached an agreement allowing oil to be pumped from fields there through Iraq's northern pipeline.
Foreign companies dealing in Iraq may be realising that they must choose between investing in Kurdistan or investing in the rest of Iraq, because they are unlikely to be able to do deals with one authority without upsetting the other.