U.N.: Iraqi, Kurdish oil deal good first step

ERBIL, Iraq, Nov. 14 (UPI) -- An interim agreement to settle internal oil issues in Iraq was met with widespread praise, though the Kurdish government said it wasn't ceding control.

U.N. Secretary-General Ban Ki-moon congratulated the Iraqi central and semiautonomous Kurdish governments for finding an interim solution to oil budget and export stalemates brewing for roughly a decade.

Federal and regional authorities are called on "to build on this important first step and to solve all remaining outstanding issues within the framework of the constitution," he said in a Thursday statement.

A constitution implemented in 2006 says the federal State Oil Marketing Organization has exclusive control over petroleum exports, with the semiautonomous Kurdistan Regional Government taking 17 percent of all oil revenues.

There are disagreements, however, over what level of control KRG has over contracts and exploitation of oil reserves in its northern territory.

Baghdad under the terms of the deal pays $500 million to the Kurdish government, which places 150,000 barrels of oil produced from its territory per day at the disposal of the federal government in exchange.

Kurdish Prime Minister Nechirvan Barzani said, however, his government wouldn't be ceding control over the region's oil to SOMO. The federal government cannot export oil from northern Iraq without first involving their Kurdish counterparts.

Jen Psaki, spokesperson for a U.S. State Department vested in the dispute, said the steps were a welcome part of an effort to find a comprehensive solution to the impasse.

"The United States will continue to serve as a neutral broker and facilitator to the extent desired by the leadership of both Iraq and the KRG," she told reporters.