US calls for ‘third-party’ mediation in energy row between Erbil and Baghdad

Settlement 'long overdue and quite necessary', Barbara Leaf says

Barbara Leaf meets Iraq's Prime Minister Mustafa Al Kadhimi in Baghdad. Photo: Iraqi Prime Minister's Office
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US President Joe Biden's administration is calling for an external arbiter to oversee talks between Iraq's Kurdistan region and the central government in Baghdad to resolve a dispute over oil and natural gas rights.

Barbara Leaf, US assistant secretary of state for Near Eastern affairs, said she had made the recommendation to Iraqi leaders during her visit to the country earlier this month.

“What I suggested was that Baghdad and Erbil [where Kurdish leadership is based] discuss arrangements to take this into third-party negotiations or some other such venue so that, essentially, they could provide the space for discussions of a technical nature,” she said in a press briefing.

A settlement was "long overdue and quite necessary”, she said.

The Oil Ministry in Baghdad on Thursday refused to comment, saying it was a political issue rather than a technical one. Calls to government representatives went unanswered.

In a brief statement to The National, Kurdistan Regional Government spokesman Jotiar Adil said the region welcomed "any initiative that can resolve outstanding issues with Iraqi federal government based on Iraqi constitution”.

Since the 2003 US-led invasion that toppled the Saddam Hussein regime, Baghdad and Erbil have been at loggerheads over many issues. Top among them are rights to develop natural resources, disputed lands that Kurds claim for their region and its share of the federal budget.

Erbil has shrugged off Baghdad's objections to develop and export oil assets unilaterally, signing more than 50 energy deals with foreign companies and states.

Baghdad considers those transactions unconstitutional, while the Kurds insist that the country’s 2005 constitution allows them to sign deals without the central government's consent.

The dispute took another turn in February when the country's Supreme Federal Court ruled that a 2007 oil and gas law in the Kurdistan region was unconstitutional and that Erbil must hand its crude oil-related operations over to the central government. In addition to raising hackles in both Baghdad and Erbil, it has also been a sticking point in government formation attempts.

The stalemate over the Cabinet formation led to a burst of violence in Baghdad this month, with supporters of Shiite cleric Moqtada Al Sadr taking to the streets and occupying government buildings inside the Green Zone.

“The recent outbreak of violence in Baghdad was a source of great concern to us here,” Ms Leaf said.

“I delivered a straightforward message to a range of senior governmental leaders, including the prime minister, the president and the Council of Representatives speaker, saying that there is an urgent need for Iraq's political leaders to come together for an inclusive dialogue to make important compromises that will chart a way out of Iraq's current crisis over government formation.”

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But the senior US official also stressed the need for dialogue with Mr Al Sadr and his supporters.

“Iraqis themselves told me how important it is that Sayed Moqtada Al Sadr‘s voice be heard,” she said. "What I was arguing for was that Iraqi leaders engage in a wholly inclusive set of discussions and take all constituencies, hopes and aspirations into consideration."

Ms Leaf stressed that Iraq's grinding impasse over government formation was undermining the country’s potential.

Asked about her trip to Israel and the West Bank, which Axios reported was driven by Washington’s concern over the security situation and fears of a collapse of the Palestinian Authority, Ms Leaf said more security co-operation between the PA and the US was always encouraged.

“The security conditions in the West Bank concern us greatly, but they also concern Israel and they also concern the Palestinian Authority,” she said. "Our part in this is to ensure that to the greatest degree possible that security co-operation is robust."

She did, however, voice concern over the economic situation in the West Bank and Gaza, and urged Israel and the PA to work together on key economic and security issues while avoiding unilateral actions.

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Updated: September 15, 2022, 1:47 PM