Iraqi oil ministry rejects Kurdistan-U.S. energy deals worth billions

BAGHDAD,— The Iraqi Federal Ministry of Oil issued a statement Tuesday firmly rejecting recent deals by the Kurdistan Regional Government’s (KRG) Ministry of Natural Resources regarding the development of the Miran and Topkhana-Kurdamir gas fields in Sulaimani Province.

On Monday, the Kurdistan Region’s caretaker government signed two oil and gas contracts with U.S. companies in Washington. The agreements, involving U.S.-based firms HKN Energy and WesternZagros, focus on developing the Miran gas field and the Topkhana oil field. Kurdish officials estimate that the projects could generate up to $110 billion in revenue.

According to the Iraqi Oil Ministry, the KRG’s contracts for investing in the fields directly violate rulings from Iraq’s Federal Court of Cassation. These rulings deem any oil and gas agreements signed after the Federal Supreme Court’s decisions in cases No. 59/Federal/2012 and 110/Federal/2019 to be unlawful.

The Ministry acknowledged Iraq’s pressing need to expand gas production and address domestic electricity demands. However, it emphasized that natural resources belong to all Iraqis and that any investment involving the country’s oil and gas must be conducted through the federal government in Baghdad.

“The Ministry reaffirms the invalidity of these contracts,” the statement concluded, “based on the Iraqi Constitution and binding rulings of the Federal Supreme Court.”

KRG Defends Gas Contracts, Citing Constitutional Authority Amid Baghdad Dispute

The KRG defended its natural gas contracts on Monday, insisting they fall within its constitutional powers despite recent objections from the federal government in Baghdad.

In a statement issued by the Ministry of Natural Resources, officials argued that the energy deals were lawful and based on the KRG’s rights as a federal entity under Iraq’s permanent constitution.

“These agreements are consistent with our constitutional authorities,” the ministry said, adding that Iraqi courts have previously confirmed the legality and validity of the contracts. “There is no legal dispute regarding them.”

The ministry clarified that recent developments only involved changes in the operating companies, which were carried out in line with existing legal and contractual frameworks.

According to the statement, the two American firms involved are long-time operators in the Kurdistan Region and rank among its leading oil producers. “They are not new investors,” the ministry noted.

The KRG further emphasized that the primary objective of the agreements is to increase local natural gas output, specifically to supply fuel for power plants.

“The ultimate goal is to ensure a stable and uninterrupted electricity supply across all regions of Iraq,” the statement said.

Meanwhile, Srwa Abdulwahid, head of the New Generation Movement in the Iraqi Parliament, issued a separate warning concerning the authority of the outgoing federal administration. She stated that the caretaker prime minister lacks the legal power to enter into high-value agreements.

Abdulwahid pointed to a Federal Court ruling that restricts caretaker governments from signing or amending contracts involving financial commitments. She condemned recent attempts by the interim cabinet to finalize billion-dollar deals with private firms, labeling such actions unconstitutional.

“The caretaker government’s mandate has expired,” Abdulwahid said. “It has no right to bind the country to contracts worth billions.”