Iraq Parliament May Take Months to OK Oil Law - Minister

The Iraqi parliament could take months, not weeks, to approve a controversial hydrocarbon law sent by the central government in Baghdad to the legislature on July 3, an Iraqi cabinet minister said Monday.

Safaaeddine al-Safi, Minister of State for Parliamentary Affairs, also said that an oil revenues distribution law is still under debate by Prime Minister Nouri al-Maliki's cabinet.

"The parliament is expected to recess from the beginning of August and I wouldn't expect lawmakers to approve the oil and gas law by the end of this month," al-Safi told Dow Jones Newswires in an interview in Amman.

Al-Safi, who is also the acting justice minister, said that parliament would wait for other lawmakers to end their boycott of the country's parliament and rejoin. Two major political blocs are boycotting the legislature: the top Sunni party, the Iraqi Accordance Party, and the Shiite Sadr bloc of anti-U.S., radical Shiite cleric Muqtada al-Sadr.

Iraqi politicians are holding talks to end these boycotts, but this could take weeks.

Another factor that could delay further the approval of the law is that the Kurds dispute the latest version of the draft oil and gas law.

The Kurdistan Regional Government's prime minister, Nechirvan Barzani, said in remarks published Monday that a draft oil and gas law agreed on with the central government in Baghdad had been amended by an advisory committee, the Shura Council.

"We are concerned that the agreed drafts have been bogged down in an obscure committee in Baghdad - called the Shura (Advisory) Council - which has made unauthorized material changes to the agreed drafts, apparently in consultation with unnamed oil ministry officials in Baghdad," Barzani said.

"This is not acceptable. It is a delaying tactic that must be swept aside. The agreed drafts must be reinstated and put to the Parliament," Barzani added.

Last week, the KRG's oil minister Ashti Hawrami said that substantial changes were made to the original draft law agreed on by all parties in February.

Al-Safi denied that major changes were made to the law and accused officials of the KRG of trying to amend the February version of the law.

Iraq's cabinet in February approved a version of the draft law but faced stiff opposition from the KRG, which felt it was getting a raw deal.

Separately, former Iraqi oil officials and veteran experts, seeking shelter in neighboring countries to avoid the violence in Iraq, rejected the draft law, saying the government and the parliament should postpone enacting the legislation until the security situation in Iraq improves.

They also rejected a provision made by the law on production-sharing agreements, saying most of Iraq's oil fields have already been discovered and therefore it isn't risky for foreign oil companies to sign such contracts.

Iraqi officials have yet to approve the oil revenues distribution law.

Al-Safi said that the cabinet may take a week or two before it could approve the draft oil revenues distribution law. He said that some parties, in clear reference to the Kurds, still disagree with some provisions of it.

The draft oil revenues distribution law, which is crucial to regulating how wealth from Iraq's huge reserves will be shared by Iraq's sectarian and ethnic groups, will become law when approved by parliament.

The law sets the quota of the Kurdistan Regional Government up to 17% of total oil and gas revenues after the deduction of national expenditure.

Iraq holds the world's largest oil reserves, which are estimated at 115 billion barrels of proven crude oil. Unproven oil reserves could be double that figure. Oil revenue accounted for around 90% of the federal budget last year. Iraq currently sells less than 1.5 million barrels of oil a day.

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