As the deadline for an agreement between the central government in Baghdad and the Kurdistan Regional Government approaches, the dispute over new details reveals the lack of desire to reach a final settlement, as each party wants to control the oil and gas file, either under the title of the government’s right or the flexibility of the regional system.
Baghdad — Negotiations between Baghdad and Erbil on a new oil and gas legislation have failed yet again, according to Iraqi parliamentary sources. This was reflected in the parliamentary Oil and Gas Committee, which admitted that it was unable to address the contentious problems between the two sides.
Because each party perceives oil and gas earnings from its own perspective, the situation has been an open sore between the central government and the regional governments since 2005.
According to observers, while the central government believes that all revenues from natural resources in Iraq must be subject to its control on sovereign grounds, the Kurdistan Regional Government believes that the federal system gives the regional government the right to control those revenues, with the option of accepting the principle of supervision. Central.
Zainab Al-Moussawi, a member of the Parliamentary Oil and Gas Committee, stated, “Legislation of the oil and gas legislation is progressing slowly as a consequence of difficult topics, the most serious of which are.
Furthermore, she said, “There is a second controversial point that indicates that the management of national wealth, including those in the Kurdistan region, is by the federal government,” as well as the fact that “the management of federal financial revenues and the export of Kurdish oil abroad through the National Oil Company (SOMO) are also controversial points.” Which Erbil is opposed to.”
despite the fact that Al-Moussawi remarked, “The dialogues between Baghdad and Erbil are still continuing to overcome differences and approve the law that will draw the map of oil in Iraq again.”
However, observers anticipate that the path available for these dialogues will be temporary settlements, related in part to facilitating the disbursement of employee salaries in the region, without resolving the fundamental issues of sovereignty over oil revenues, the limits of central supervision over them, and whether the federal system grants the regional government authority over them. It gives them autonomous powers to manage local riches, just as it gives them autonomous rights to govern other local concerns.
In Baghdad, it is widely assumed that providing Erbil autonomous rights over oil will fuel separatist sentiments and give the Kurdistan Regional Government with resources disproportionate to the region’s part of the state’s general budget. While a handful of governorates have oil resources, resource income are shared by all.
Kurdish authorities deny the charge that controlling the region’s oil resources is a precursor to fresh separatist movements, and they think that, while the federal system allows the central government some powers, it does not grant it all rights, as is the situation presently.
The proposed Iraqi oil and gas legislation, according to the central government, should control the oil and gas sector through a single national business, with imports placed in a single account.
The Federal Court in Baghdad ordered the area to give over the oil produced on its grounds to Baghdad and to invalidate the contracts it had signed with foreign businesses in February of last year. The situation deteriorated to the point where the Baghdad judiciary nullified contracts with numerous foreign corporations, particularly American and British.
A temporary agreement signed in early April between Baghdad and Erbil stipulates that Kurdistan oil sales will be made through the Iraqi Oil Marketing Company “SOMO,” and that revenues generated from the region’s fields will be deposited in a bank account with the Central Bank of Iraq or one of the Central Bank of Iraq’s approved banks.
The Kurds deny that ownership of the region’s oil riches is a precursor to fresh independence aspirations.
According to Jutiar Adel, the head of the Kurdistan Regional Government’s Media and Information Department, the draft law “must reflect the principle of true partnership, and include mechanisms for the optimal use of Iraq’s natural resources, as well as the necessity of fairly guaranteeing the rights of all parties.”
The argument between the two parties focuses around a phrase included in Article 112 of the Iraqi Constitution, which was released in 2005. The article goes on to say: “The federal government shall manage the oil and gas extracted from the current fields with the governments of the producing regions and governorates, provided that it distributes its imports in a fair manner commensurate with the population distribution.” With a portion going to the impacted areas that were neglected by the previous government.”
According to a decision issued by the Kurdistan Region Judicial Council on May 30, 2022, the paragraph concerns “current” fields, which excludes Kurdistan Region fields from inclusion because they appeared several years later and were exploited under a special law passed by the region’s parliament in 2007. It is at this point that observers ask, “If new oil fields appear in other regions of Iraq, does this mean that they will not be covered by this article of the constitution?”
