The Iraqi federal government’s oil ministry has sued the government of the semi-autonomous Kurdistan Region of Iraq over oil and gas contracts it signed with U.S. firms, three sources with direct knowledge of the matter said and a document showed.
The legal challenge is the latest obstacle to the resumption of flows through the Iraq-Turkey oil pipeline that have been halted since March 2023, despite pressure by the administration of U.S. President Donald Trump.
Masrour Barzani, the prime minister of the Kurdistan Regional Government, or KRG, oversaw the signing of two energy agreements worth a combined $110 billion over their lifetimes with U.S. companies HKN Energy and WesternZagros.
Reuters has contacted the companies, but has not yet received a response.
The agreements involve the development of the Miran and Topkhana-Kurdamir gas fields in the northern Iraqi city of Sulaimaniya.
Baghdad has said direct engagement between companies and the KRG without the federal government’s inclusion violates the constitution. It has called the deals “null and void”.
The KRG has defended the agreements, saying they were based on existing contracts.
The sources who spoke about Iraq’s legal action spoke on condition of anonymity because they were not authorised to speak publicly on it.
Barzani met with U.S. Secretary of State Marco Rubio on Friday during a visit to Washington, D.C. and they discussed “the need to resume oil exports from the Kurdistan Region through the Iraqi Turkish pipeline,” a KRG statement said.
Control over oil and gas has long been a source of tension between the federal government and the Kurdistan regional government.
A major issue concerns the pipeline running through Turkey.
Flows through it were halted after the Paris-based International Chamber of Commerce ruled that Turkey violated provisions of a 1973 treaty by facilitating Kurdish exports without Baghdad’s consent.
Negotiations to resume Kurdish oil exports via the Iraq-Turkey oil pipeline, which once handled about 0.5% of global oil supply, have stalled over payment terms and contract details.
Source: Reuters