Iraqi ministry casts doubt on oil law

The Oil Ministry cast doubt Sunday on statements indicating the Kurds had agreed to support a draft oil law that would divide revenues among all Iraqi factions and meet a key U.S. benchmark in Iraq.

Prime Minister Nouri al-Maliki's government had promised to enact a new oil law by the end of 2006 but missed the deadline due to objections from the Kurds. Many of Iraq's vast oil reserves can be found in the Kurdish north and the Shiite south, and the Kurds wanted a greater role in awarding contracts and administering the revenues.

Massoud Barzani, president of the self-governing Kurdish administration in the north, said Saturday that he and President Jalal Talabani, a Kurd, had discussed the latest draft law by telephone with al-Maliki and "the results were good."

Barzani made the comments in a joint press conference with Talabani after a meeting with U.S. Ambassador Zalmay Khalilzad in the northern Kurdish city of Sulaimaniyah.

"We reached a final agreement," Barzani said, without elaborating. "We accept the draft."

The U.S. Embassy said it was "an encouraging development."

"It reflects commitment from all sides to achieve a hydrocarbon regime that serves the interests of all Iraqi people while taking into consideration important regional concerns," John Roberts, an embassy spokesman, said Sunday.

An oil ministry spokesman, however, stressed that the draft law still needed to be discussed at the Cabinet level.

"Today, we got confirmation that Barzani said that they support the draft law but he mentioned nothing about agreeing to it," ministry spokesman Assem Jihad said. "The discussions and the negotiations are still ongoing."

It was unclear if Barzani was saying he supported the idea of a law or the draft as currently worded. Kurdish officials could not be reached for clarification.

Once the Cabinet signs off, the measure goes to parliament for final approval once the legislators return from a recess early next month.

The Bush administration, facing growing pressure to end the Iraq conflict, has been urging the Iraqis to finish the new oil law.

A new law is needed, most outside experts believe, to encourage international companies to pour billions of dollars into Iraq to repair pipelines, upgrade wells, develop new fields and begin to exploit the country's petroleum reserves, estimated at about 115 billion barrels.