While the federal government of Iraq welcomes cooperation with U.S. energy firms, Baghdad noted on Friday that direct deals with the semi-autonomous Kurdistan region violate the Iraqi constitution and need to go through the federal authorities with federal approval.
Earlier this week, the Kurdistan Regional Government (KRG) in northern Iraq formalized two major energy agreements with U.S. firms HKN Energy and WesternZagros in Washington, D.C.
“These agreements lay a robust foundation for the strategic development of the Topkhana energy block in Garmian—an asset with significant commercial potential. This initiative is designed to strengthen energy security while generating attractive returns for stakeholders and driving economic growth throughout the region,” KRG said.
The combined Topkhana-Kurdamir block holds an estimated 5 trillion standard cubic feet of natural gas and 900 million barrels of recoverable crude oil, Kurdistan says.
The U.S. State Department welcomed the deals, saying that “These types of partnerships will strengthen gas production in Iraq and benefit both of our peoples.”
The agreements are valued at a combined $110 billion, despite a legal showdown with the federal government of Iraq over control of the country’s oil exports.
The recent signing of these substantial energy agreements between the KRG and American companies raises questions about the legal and political implications, given the ongoing disputes between Baghdad and Erbil over oil control.
However, Iraq’s Oil Ministry on Friday said that the deals should go through the federal government.
“The Ministry has no objection or reservation regarding engagement with these companies, provided that such engagement is not conducted directly with the Kurdistan Regional Government in isolation from the Federal Government and its official channels, as this would constitute a violation of the Iraqi Constitution and the applicable law,” the Iraqi oil ministry’s statement said on Friday.
“The oil ministry’s statement is a clear message directed at US companies, alerting them to respect Iraq’s valid laws,” an official at the oil ministry told Middle East Online on Friday.
By Charles Kennedy for Oilprice.com
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