Iraq PM asks Obama to stop Exxon's Kurdish deal‎

Spokesman warns of "wars" if Exxon oil deals with KRG not scrapped

Iraqi PM Nouri al-Maliki has written to the White House asking for intervention to quash Exxon's deals with the KRG. GETTY IMAGES
Iraqi PM Nouri al-Maliki has written to the White House asking for intervention to quash Exxon's deals with the KRG. GETTY IMAGES

Just as the US thought it had got out of Iraq, Prime Minister Nouri Al-Maliki drags it back in.

Maliki has written to the US government, asking President Obama to intervene to stop ExxonMobil carrying out its contracts for the development of oilfields in the Kurdistan region, report newswires.

"Maliki views these deals as representing a very dangerous initiative that may lead to the outbreak of wars," Ali Mussawi, Maliki’s spokesman, told AFP yesterday. Mussawi said if Exxon continued activities in Kurdistan it risked "breaking up the unity of Iraq."

While Kurdish regional President Massud Barzani has frequently resorted to populist invective raising the possibility of armed conflict, this is the first time that the Maliki government has made a direct warning about Kurdish separatist oil policy’s potential to reignite civil conflict.

It also indicates a level of desperateness on Maliki’s part, who may be pilloried by political opponents for turning to the US.

Mussawi told AFP that Maliki "sent a message to American President Barak Obama last week urging him to intervene to prevent ExxonMobil from going in this direction."

“We've received the letter but are going to decline comment until we respond to Prime Minister Maliki," White House spokesman Tommy Vietor told Reuters.

Industry sources say Exxon is preparing to shoot seismic, has tendered for drilling services, and is securing office and staff accommodation in the regional capital Erbil.

"Despite Exxon's letters about their freezing of their work in the region, we still receive information that suspicious work is going on relating to their exploration activities," Mussawi told Reuters.

The news closes the door on hopes that the Iraq government could be steamrolled by a supermajor into reconciliation with the Kurdish region over oil policy, shortly after the Kurdish regional government’s (KRG) oil minister Ashti Hawrami announced that the region would begin exporting its crude directly through an independent pipeline and is looking forward to the entry of more major oil companies to the region in the next few months.

The KRG signed a deal with ExxonMobil on 18 October for the US oil giant to explore and develop six blocks. Three of the blocks are outside the politically-delineated boundaries of Kurdistan. For the time being the KRG is treating its de facto control of these areas as definitive.

The contracts allow Exxon to book reserves and draw profit oil, which Baghdad says is unconstitutional, something the KRG denies, pointing to legal opinions it has obtained.

"Offering Exxon an exploration deal without central government knowledge and approval has been and will stay illegal," Mussawi told Reuters.

The central oil ministry used its interpretation of the constitution to suspend payments to the KRG reimbursing the costs of companies producing oil there, provoking the KRG to shut in its production until it is paid.

Maliki and his government have slumped to new lows of unpopularity, with a recent abortive no-confidence campaign falling just short of the requisite votes needed to unseat him.

Atheel al-Nujaifi, governor of the impoverished Nineveh province which abuts the Kurdish region, recently came out in support of the Exxon deals in an interview with Iraq Oil Report, despite two of the disputed fields sitting within his province. Nujaifi had previously called the Exxon deals an opportunity for militants who "want to put us in confrontation with the [Kurdistan] region."

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