Iraqi Kurds’ oil contracts with foreign firms are not only illegal but even cover portion of territory officially outside the borders of their semi-independent enclave, a former oil minister said.
Isam al-Jalabi, who held the oil portfolio under the former regime of Saddam Hussein, said the latest deal the Kurds struck with Texas-based Hunt Oil Company gives it the right to explore and dig wells in areas which are under the jurisdiction of the Province of Nineveh.
The Kurdish enclave now includes the provinces of Dahouk, Sulaimaniya and Arbil. The Kurds are trying to add the Province of Taameem of which the oil-rich city of Kirkuk is the capital.
The Kurds are pressing ahead with inking oil deals with foreign firms despite opposition from the central government in Baghdad and the fact that the National Oil and Gas Law is still a draft not passed by parliament.
The Kurds say they have deals with three other foreign firms: Norway’s DNO which is drilling near the border city of Zakho, the Canadian Heritage Energy Middle East Limited and Perenco S.A., a French oil firm.
The courting of oil firms by Kurdish autonomous government has angered the central government, particularly the Sunni Arabs who would like the exploitation of the country’s natural resources to be a prerogative of the national government in Baghdad.
The oil ministry has declared those deals illegal and neighboring countries have said they would not let Kurds export oil without central government approval.
Jalabi, currently an oil consultant with international fame, backed oil ministry’s decision not to acknowledge the deals by Kurds, saying the contracts are “unconstitutional.”
Jalabi said the Kurds were proceeding with their production and sharing contracts with foreign firms despite pledges to stop doing so.
He said the Kurds have even shrugged off U.S. pressure not to develop crude oil reserves in their areas on their own.
He said the Kurds have at least signed 10 contracts with European and American oil firms.