Iraq unhappy over RIL’s Kurdish blocks, threatens blacklisting

Iraq unhappy over RIL’s Kurdish blocks, threatens blacklisting
PTI
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First Published: Thu, Nov 15 2007. 02 57 PM IST
Updated: Thu, Nov 15 2007. 02 57 PM IST
Riyadh: Iraq Thursday threatened to blacklist India’s Reliance Industries (RIL) from future oil contracts after the company struck a deal with the Kurdish Regional Government (KRG) for two blocks without Baghdad’s approval.
“Our position is very clear. Any company that signs contracts with the Kurdish Regional Government without approval of the central government, they will compromise chances of getting future opportunities in Iraq,” its Oil Minister Hussain Al-Shahristani told reporters here.
Hussain, who is here to attend the OPEC ministerial meeting ahead of the summit level talks among member countries, said that Baghdad had “conveyed this to all the companies that have recently signed production sharing contracts. That has also been conveyed to Reliance Industries.”
RIL had last week signed the contract for the blocks Rovi and Sarta in northern Iraq with the autonomous KRG. The blocks, measuring 517 and 607 sq km respectively, have almost 80% oil bearing structure.
Reliance is confident of making a discovery soon. RIL paid a signing amount of $15.5-17.5 million for the blocks.
Asked about the consequences if companies go ahead and sign the contract, the minister said: “Iraq will not allow its oil to be exported without federal government approval. We have informed and warned the companies of the consequences. They will not be able to take oil out of the country.”
RIL officials in India were not immediately available for comments.
The Kurdish region is located in land-locked northern Iraq and has no port facilities, which makes sale of gas without Baghdad’s approval virtually impossible.
Besides the two blocks to RIL, KRG had awarded five others to foreign companies defying Baghdad’s proposed new oil law. The central government opposes unilateral sell-off of crude blocks in the absence of a national oil law, which is yet to be passed by Parliament.
“There is no legislative vacuum in Iraq. These contracts have no standing with the Iraqi government,” Hussain said, while threatening companies that have signed contracts with KRG with “dire consequences”.
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First Published: Thu, Nov 15 2007. 02 57 PM IST