Iraqi Kurdistan voiced confidence on Thursday that ExxonMobil would stick to a controversial energy deal after rare talks between the U.S. firm and Baghdad sparked speculation that it would backtrack.
The speculation came as the region announced it had awarded an exploration contract to fellow U.S. energy giant Chevron, amid a long-running dispute between the autonomous Kurdish region and the central government over oil contracts.
“Kurdistan regional government is confident that ExxonMobil will abide by the contracts that it signed with the region which caused noise with the Iraqi government in Baghdad,” regional “Prime Minister Nechirvan Barzani said at a news conference in Arbil.
“We are confident that ExxonMobil... will abide by its promises.”
Barzani’s remarks come after Exxon’s chief Rex Tillerson met Iraqi Prime Minister Nuri al-Maliki and Kurdish president Massud Barzani in successive days.
The rare talks with Maliki sparked speculation Exxon was considering backing off the Kurdish deal for oil exploration, which it signed in October 2011. The contract angered the central government which has said the US firm must choose between its deals with Baghdad and the autonomous region.
Exxon and Anglo-Dutch giant Shell had completed a deal in January 2010 to develop production at West Qurna-1, an oilfield in south Iraq, but late last year the US firm informed Baghdad that it wanted to sell its stake in the project, indicating it would focus on the controversial Kurdish deal.
The Exxon dispute is one of several between Baghdad and the Kurdish region -- the central government also regards other contracts signed by Kurdistan to be illegal because they were not approved by the federal oil ministry.
Massud Barzani’s office, meanwhile, issued a statement on Thursday saying Kurdistan had awarded an exploration block in the south of the three-province region to Chevron.
Chevron executive Jay Pryor “was informed that Chevron’s bid for the Qara Dagh exploration area has been successful, and that a contract would soon be finalised,” on the sidelines of the World Economic Forum in Davos, the statement said.
The American firm announced in July that it had bought two exploration blocks in Kurdistan, despite Baghdad’s protests.