Iraq has dubbed as "illegal" the contracts signed by Reliance Industries' (RIL) for two oil blocks in Kurdistan saying companies signing oil deals with Kurdistan Regional Government (KRG) cannot bid for lucrative oilfields contracts in Iraq.
A year after Reliance signed contracts for Rovi and Sarta oil blocks in northern Iraq with the autonomous KRG, Iraqi Oil Minister Hussain Al-Shahristani said any oil produced and taken away without approval of the Central government was tantamount to "smuggling" and will be dealt with accordingly.
"The contracts that were signed by the KRG were in violation of the current laws and in violation of the draft hydrocarbons (law).... Therefore, we have announced that those contracts are not standing with Iraq," he said in an interview to oil cartel OPEC's official monthly bulletin.
Iraq is a member of Organisation of Petroleum Exporting Countries but its oil output is not included in production quotas of OPEC.
"Foreign companies have no right to work on Iraqi territory without the approval of the central authority and they deal with the consequences of their actions," he warned but did not say if Baghdad has blacklisted the firms.
"Any oil produced in Iraq or taken out of the country without the approval of the Central government is considered smuggling and will be dealt with as such," he said.
More From This Section
Iraq, with world's second-largest proven oil reserves, already announced first round of bidding for oilfields that has seen explosive interest by global energy giants. India's ONGC Videsh is among the companies shortlisted but Reliance does not figure in the list.
A second bid round is likely to be announced before the end of the year.