In Iraq, fault lines run deep over Kirkuk's future

An Iraqi soldier stands guard near the scene of an explosion that struck a gas pipeline transporting unrefined gas from Kirkuk's oil fields' largest refinery in Baiji, in the Laqlaq area about 15 km (10 miles) northeast of Baiji February 11, 2008.

KIRKUK, Iraq (Reuters) - The failure of Iraqi politicians to resolve competing ethnic claims for the oil-rich northern city of Kirkuk is storing up explosive problems for the country's future.

After months of debate, parliament shut for a summer break without agreement on a new law paving the way for the first provincial elections since 2005 -- and it was divisions over how to hold the vote in Kirkuk that scuppered a deal.

"Postponing the election law will complicate the situation in Kirkuk and lead to a struggle between the factions and eventually a civil war may erupt," said Ali Ibrahim, an Arab.

"The parliament and the government has to work seriously to resolve the situation", he said.

Kirkuk sits atop oil reserves that supply a fifth of Iraq's export income, and the country's Kurds want to fold a city they consider their ancestral capital into their autonomous northern region of Kurdistan.

But Arab and Turkmen residents want Kirkuk to remain part of a federal Iraq run by the government of Shi'ite Arab Prime Minister Nuri al-Maliki from the capital Baghdad.

Iraq's Kurdish leader Masoud Barzani traveled to Kirkuk on Friday saying he sought to calm tensions.

"We want to solve the problem, not ignite the problem and I came to Kirkuk with a message from the Kurdish people which is the message of brotherhood, love and invitation for understanding," Barzani told Kirkuk's provincial council.

"If there is a shortcoming in the Kurdish performance, we are ready to rectify it," he said.

An initial version of the election law, which would have given Arabs and Turkmen a fixed quota of seats on Kirkuk's provincial council, was passed by parliament last month. But Kurdish deputies boycotted the session and Iraqi President Jalal Talabani, himself a Kurd, vetoed it.

Both sides now fear prolonged wrangling over the election law could worsen ethnic tensions in Kirkuk. A suicide bomber killed more than 20 people at a Kurdish protest against a disputed version of the election law last week.

Maliki's government has come under enormous pressure from Washington and the United Nations to hold provincial elections but the Kirkuk impasse now means polls will not take place on October 1 as initially planned.

U.S. President George W. Bush personally phoned Iraqi politicians to press them to compromise at talks that ran late into the night this week. The United Nations offered a last-minute proposal but parliamentarians failed to strike a deal and decided to put the issue aside until September.

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Reliable statistics on the ethnic breakdown of the city are hard to find. Many Arabs were moved into Kirkuk under Saddam to "Arabize" the city, and fear that Kurds want to push them out.

Kurds want a referendum to be held in the city, as promised under Iraq's constitution, believing that they would win and Kirkuk would join Kurdistan. They believe Arab political parties are trying to avoid that reckoning.

"Kurds are fed up with the crooked policy of Maliki's government. It is time to bring Kirkuk back to its origin: Kurdistan," said Khorsheed Jibari, a Kurdish taxi driver.

"Annexing Kirkuk to Kurdistan is the right call," said Ribwar Hashim, a Kurdish laborer. But he believes a referendum, which might tip the scales in the Kurds' favor, won't happen.

Arabs and Turkmen fear Kurdish domination of local government. They want the Kurdish Peshmerga security forces in the area replaced with troops from other parts of Iraq.

"Kirkuk has become a real problem," said Suad Muhammad, a Turkmen student. "Maliki's government has to prove its influence by ensuring all Iraqi factions are represented in the provincial council and not let some parties control the city," she said.

The United States wants Iraq to push ahead with provincial elections to bolster the country's fledgling democracy -- and resolving the Kirkuk dispute is key.

Neighbors Iran and Turkey are also watching closely. They fear a resurgent Kurdistan with Kirkuk as its capital could encourage separatist Kurdish movements in their own countries.

Many Kurds are resentful.

"We have fears about foreign agendas by parties inside and outside Kirkuk. Why have all the parties' positions unified against the Kurds?" said Muhammad Abdul-Rahman, a Kurd.

(Additional reporting by Khalid al-Ansary and Aws Qusay in Baghdad; Editing by David Clarke and Samia Nakhoul)