Iraq and Britain hope to seal troop deal by year end

BAGHDAD (Reuters) - Britain and Iraq have yet to finalize a deal permitting 4,100 British troops to stay in Iraq but hope it can be done before their U.N. mandate expires in two days, a British embassy spokesman said on Monday.

Iraq's Presidency Council on Sunday ratified a measure allowing troops from Britain, Australia, El Salvador, Romania and Estonia and other NATO nations to stay in Iraq through July 2009.

"We've had the ratification, now we can go to the next step," said the British embassy spokesman, who declined to be named. "We're still working toward getting a deal finalized before the end of the year."

He said Britain's bilateral agreement with Iraq would set out the mission of British troops, mostly stationed near the southern oil hub of Basra, in their remaining time, along with what they can expect from Iraq.

"We are satisfied that it has the legal cover we need with our forces," he said.

The official said the document would not specify when British troops must withdraw, which is covered by the parliamentary resolution requiring withdrawal of all non-U.S. foreign combat forces by July 31.

Britain, the main U.S. ally in the 2003 invasion which once had 45,000 troops in Iraq, intends to keep about 400 advisers and trainers in the country after the July deadline.

While the spokesman declined to comment on what might occur if the new arrangement is not finalized by January 1, British officials say they do not expect Britain to suddenly pull out.

(Reporting by Tim Cocks; Editing by Katie Nguyen)