Iraq Oil Minister says, "Iraqi Oil Law Approval is Months Away"

Reuters reports:

Final approval of a long-awaited Iraqi oil law that would help usher in new investment is months away, Oil Minister Hussain al-Shahristani said on Thursday.

"The different factions in parliament need to resolve their differences and they haven't done that yet. This could take some time and could be months," he told reporters at an OPEC heads of state summit in the Saudi capital.
Iraq would try to find ways to work with international oil companies on its giant southern fields even without the oil law in place, Shahristani said.

"We don't necessarily need a new law for that, we have the existing legislation in the country," he said.

"We have started talking with oil majors on these fields and we'll find a way to cooperate and enhance production from these fields."

Iraq's cabinet agreed a draft law for dividing the world's third largest oil reserves in February, but disputes with the regional government in Kurdistan, as well as objections from Shi'ite and Sunni Arab politicians, have hobbled progress.

Oil companies have been providing technical assistance and training to Iraq for years as they look to position themselves for contracts when the law is passed.

Shahristani reiterated that Baghdad would block companies that had signed deals with the Kurdish regional government (KRG) in the north from contracts elsewhere in Iraq.

"Our position is that any company that signed such contracts will compromise their chances of getting any business in the future in Iraq and this message has been conveyed to the companies," Shahristani said.

Companies that produce oil under the deals will not be able to export it without approval from the federal authorities, he said.

The KRG has pushed ahead with plans to attract foreign firms to develop its oil and gas despite opposition from Baghdad, which says the new contracts are illegal.

On Monday, the regional government in Iraq's semi-autonomous Kurdistan said it had awarded five new petroleum production sharing contracts to foreign firms, further angering Iraq's central government.

An improvement in the country's security situation would allow exports to rise to 2 million bpd by the end of the year, Shahristani said.