Kurdistan prime minister rejects Iraq oil auctions
Barzani says deals violate constitution
Reuters - [6/27/2009]
The prime minister of Iraq's largely autonomous Kurdistan region condemned on Friday plans by the Oil Ministry to auction six fields in a June 29-30 tender 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, the world's third biggest, often sees them refusing to recognise each other's dealings with foreign firms.
The dispute is part of a wider struggle over power and land that analysts say is the greatest long-term threat to Iraq's stability as the United States 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," Prime Minister Nechirvan Barzani wrote on the Kurdish Regional Government (KRG) website.
Two of the oil fields, Kirkuk and Bai Hassan, are in territory that is disputed between Baghdad and Kurdistan. The Kurds say 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 firms 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.
China's state oil group Sinopec is thought to be preparing a bid for London-listed Addax Petroleum Corp. (AXC.L), with a field in Kurdistan. Such a move could end up excluding Chinese companies from winning fields in the bidding round. Baghdad does not recognise the legitimacy of the Addax concession.
Barzani says deals violate constitution
Reuters - [6/27/2009]
The prime minister of Iraq's largely autonomous Kurdistan region condemned on Friday plans by the Oil Ministry to auction six fields in a June 29-30 tender 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, the world's third biggest, often sees them refusing to recognise each other's dealings with foreign firms.
The dispute is part of a wider struggle over power and land that analysts say is the greatest long-term threat to Iraq's stability as the United States 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," Prime Minister Nechirvan Barzani wrote on the Kurdish Regional Government (KRG) website.
Two of the oil fields, Kirkuk and Bai Hassan, are in territory that is disputed between Baghdad and Kurdistan. The Kurds say 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 firms 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.
China's state oil group Sinopec is thought to be preparing a bid for London-listed Addax Petroleum Corp. (AXC.L), with a field in Kurdistan. Such a move could end up excluding Chinese companies from winning fields in the bidding round. Baghdad does not recognise the legitimacy of the Addax concession.