The Iraqi Parliament's Oil and Energy Committee has formally asked the legislature to ban all future oil contracts until a law governing the energy sector is approved.
In an official statement read in Parliament Saturday and formally received by the speaker, the committee asked Parliament to vote on a ban of all oil deals "whether by the federal government or the regions or producing provinces."
Committee Chairman Adnan Janabi told Platts Sunday the reason for the ban was to force politicians to finally approve a federal hydrocarbon law, which has been held up by political infighting since early 2007.
Janabi said there were a number of interpretations of the legality of the contracts signed with foreign oil companies by both the central government and the Kurdistan Regional Government, based on a variety of laws.
An oil and gas law, proposed in 2007 but held up by disagreements, mainly between Baghdad and the Kurdistan Regional Government, would in theory settle the disputes or create a means to settle any outstanding issues.
Janabi said that according to the committee's interpretation, all oil contracts need to be approved by Parliament.
Iraq's Oil Ministry has signed 12 long-term service contracts with foreign oil companies and consortia for oil and gas field developments in three separate international auctions without waiting for the federal hydrocarbon law to be passed.
The ministry has insisted that the contracts are in line with the post-2003 constitution and only cabinet approval is required.
The KRG passed its own oil and gas law in 2007 and has used that as a basis to grant production-sharing contracts to a host of foreign oil companies, disregarding Baghdad's designation of the contracts as illegal under Iraqi law.
The committee said last week that it had discussed the service contracts awarded by the Baghdad ministry and considered that they were illegal because they had not been approved by parliament.
The Iraqi Oil Ministry has also launched an exploration round and is planning to award contracts in January.
