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Iraq says it can't work with Exxon

Jan. 28, 2013 at 6:51 AM

BAGHDAD, Jan. 28 (UPI) -- The central government of Iraq won't let U.S. supermajor Exxon Mobil "step over the constitution," Iraqi Oil Minister Abdul Kareem al-Luaibi said.

Exxon, Chevron and French supermajor Total are operating the West Qurna-1 oil field in southern Iraq. All three have been sources of frustration for Baghdad as they seek more work in the semiautonomous Kurdish provinces of northern Iraq.

Luaibi was quoted by Bloomberg News as saying Baghdad wouldn't deal with companies working in the country without the central government's consent.

"We can't allow Exxon to step over the constitution," he said. "It can't continue to work in both places at the same time, they have to choose to work either in Iraq or in Kurdistan."

Both governments are at odds over which party has the ultimate say over certain aspects of the oil sector. The Kurdistan Regional Government issued a statement recently that said it was frustrated with efforts by Baghdad to let BP work in the disputed region of Kirkuk. Luaibi, however, said BP made his government a "good offer" to work in Kirkuk.

The Kurdish government imposed restrictions on oil exports as a sign of growing frustration with the central Iraqi government over oil laws.

The Organization of Petroleum Exporting Countries, in its January report, said Iraq was among the members where oil production declined.

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