Baghdad sought to hinder Kurdish deals with foreign companies

ERBIL, May 31 (AKnews)

Iraq has put pressure on Western oil companies not to make deals with the Kurdistan Regional Government (KRG) without assent from the central government.  

Iraq's government has restricted foreign investors' ability to sign contracts with the KRG, saying the Oil Ministry inserted a clause in oil lease auction papers that gave ministers the authority to cancel any contracts signed between foreign oil companies and the region without prior approval. 

Abdul Mahdy al-Ameedi, the head of the ministry's petroleum contract and licensing directorate, told Dow Jones: "We decided to include an obligation on the side of the companies... not to work in any area of Iraq - not just the Kurdistan Region - without the approval of the federal government."

Exxon Mobil signed six contracts last year with the KRG. The contracts led to strong opposition from Baghdad, which deems Kurdistan is not authorized to sign such contracts.

The Iraqi government said in April US-based Exxon Mobil is not allowed to bid in Iraq's May energy auction because of its oil deals with the Kurdistan Region.

© AK News 2012