| 2008: Baghdad prevents KRG oil exports |
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September 19, 2008 Balo: Maliki and Shahristani are main hinders to the national Oil and Gas Law approval Kurdish MP Ali Hussein Balo defends Kurds, who some accuse of hindering passage of the law. Abdul-Hadi al-Hassani, the Deputy Chief of the Oil and Gas Committee in the Iraqi Council of Representatives announced that his country's government is cooperating with neighboring countries to prevent the Kurdistan Regional Government (KRG) from exporting its oil and gas to outside Iraq. This claim comes at a time when tensions between Erbil and Baghdad, and particularly Iraqi Oil Minister Hussein al-Shahristani, still exist over KRG oil deals and activities. Negotiations for a solution are ongoing. Al-Hassani, MP on the United Shiite Alliance List and Deputy Chief of the Oil and Gas Committee, also says that the KRG Oil and Gas Law passed by the regional Parliament in August 2006 includes many articles that are different and even opposite to the draft National Oil and Gas Law, which has already been approved by the Council of Ministers and awaits Parliament approval. There have been lots of arguments and disagreements between the KRG and the central government about the national law. Kurdish representatives in Baghdad took part in drafting the law, pushed other political groups to accept it, and were very optimistic about the decision of the Ministerial Council to approve the draft law. However, as Kurds claim, some parties changed some parts of the law on its way to Parliament, thereby reducing the powers of the regions over oil and gas revenues and adding to the central government's powers. This irritated the Kurds, who decided not to vote for this law in Parliament. Due to these tensions between Baghdad and Erbil, the KRG passed its own Oil and Gas Law and signed a number of production-sharing contracts (PSCs) with some international oil companies to invest in the region's oil and gas resources. This angered al-Shahristani, who described the PSCs as illegal. He went further and vowed not to cooperate with those foreign companies who signed contracts with the KRG. As a measure to threaten those companies, al-Shahristani decided to stop working with an Austrian company and to stop selling it oil. Among those oil and gas investment contracts is the contract between the KRG and Dana Gas and Crescent Oil for the implementation of the Gas City project. Like all other KRG contracts, this contract has been signed without the coordination of the Iraqi Oil Ministry and under the supervision of Somo Company, a public-sector company affiliated with the Oil Ministry, which is managing Iraq's oil sales. In the case of Crescent Oil, the Iraqi Oil Ministry has also decided not to sign any contracts with the company since it is working on the Gas City in Kurdistan. Al-Hassani said that this contract has to be signed under the supervision of the Iraqi government. He added that he doesn't expect the KRG to export oil and gas without the central government's consent. According to what al-Hassani says, the Oil Ministry is currently trying to abolish all the contracts that have been signed before the approval of the national law, which is expected to be approved by the Iraqi Parliament in the near future. Ali Hussein Balo, a Kurdish MP and a chairman on Iraqi Parliament's Oil and Gas Committee, said on September 11 that though some Iraqi officials claim the Kurds are hindering the approval of the Oil and Gas Law, the opposite is true. He also said that al-Hassani's speeches about the issue are far from reality. "The Iraqi government and Prime Minister Nuri al-Maliki himself and Hussein al-Shahristani hamper the approval of the law," Balo told a local Kurdish news agency. "This is because since February last year all the political parties have agreed on a draft of the law, but later changes were made in the draft." Balo also added that until now, the Oil Ministry hasn't been able to submit the changed draft to the Parliament's Oil and Gas Committee so as to be put into Parliament's schedule for discussion and approval. Source: Iraq Directory |