* Qara Hansher or "black fig" field in disputed area
* Exxon mulling whether to stay at southern oilfield
* Baghdad, Kurdistan have built up rival military posts
By Ahmed Rasheed
BAGHDAD, Feb 1 Exxon Mobil and Iraqi
Kurdistan officials visited an oil exploration block caught in a
dispute between Baghdad's central government and the autonomous
Kurdish region, and discussed building a camp there, a local
official and sources say.
Talks at the Qara Hansher block between an Exxon executive
and a top Kurdistan oil official could provoke Baghdad at a
sensitive time for the Arab-led central government and the
self-ruled Kurdish enclave in their feud over oil and land
Since it signed for six oil blocks with Kurdistan last year,
Exxon has been at the centre of the growing disagreement between
Baghdad and Kurdistan that threatens to fracture the OPEC
member's uneasy federal union a year after U.S. troops left.
The visit came as Exxon weighs whether to stay or pull out
of its huge West Qurna oilfield in the Iraqi south or keep its
Kurdistan fields. Iraqi and Kurdish officials have both
suggested Exxon will side with them.
The Qara Hansher field, where the meeting took place on
Wednesday just north of Kirkuk, sits in the swath of disputed
territories, where both regions claim jurisdiction and where
Iraqi Arab and Kurdish troops have reinforced positions in a
tense standoff since last year.
"In the meeting we discussed the work of Exxon Mobil in Qara
Hansher block and we discussed how to facilitate the company's
work," Avesta Sheikh Mohammed, the local Kurdish major of the
area. "The Kurdistan Regional Government has all the right to
sign oil deals to develop energy resources."
An Iraqi oil official and a Kurdistan oil official confirmed
the meeting had taken place to talk over building a camp in the
block in the low hills.
No work or drilling has started at the Qara Hansher block -
whose name means "black fig" in Kurdish - and the talks were for
an initial site, the sources said.
Qara Hasher shows the complications of working in the
disputed territories. Before the 2003 invasion that toppled
Saddam Hussein, Qara Hansher was part of Kirkuk. Baghdad still
considers it part of Kirkuk, but the Kurds claimed it as part of
their region and the mayor was apppointed by the Kurdistan
Baghdad says oil deals signed with Kurdistan are illegal and
warned foreign companies they risk losing their agreements in
Iraq's southern oilfields if they develop Kurdistan fields. But
fields in the disputed territories are more complicated.
Industry sources have said Exxon is considering concessions
from Baghdad to keep to stay at the $50 billion West Qurna.
One Iraqi oil official said the U.S. major may be trying to
smooth relations with Kurdistan with the block visit after the
company's top executive meet last month with Iraq's Prime
Minister Nuri al-Maliki.
"If Exxon visited the block that does not mean it will
actually start upstream operations anytime soon. I think they
are comforting the Kurds, saying they won't abandon them," a
senior Iraqi oil official said. "Let's not jump to conclusions,
let's wait and see."
AUTONOMY AND OIL
Autonomous since 1991 with its own regional government and
armed forces, Kurdistan says that the federal constitution
enshrines its right to develop its oilfields.
The region is steadily developing more energy autonomy, but
still relies on the central government for a share of the
national budget from oil revenues.
Since Exxon entered Kurdistan, tensions between Baghdad and
Kurdistan have increased, but the U.S. major's move also opened
the door for other large foreign companies such as Chevron
, France's Total and Russia's Gazprom Neft
to sign up.
Chevron recently added a third block to its assets in
Iraq's oil minister on Sunday said during the most recent
meeting with Exxon, the government had made clear once again
that the U.S. company must decide between the two regions.
"Exxon Mobil cannot work in the two fields at the same
time," Oil Minister Abdul Kareem Luaibi said.
International oil companies have been prepared to take that
risk in return for Kurdistan's better contract terms, security
and an easier working environment, as opposed to the bureaucracy
and infrastructure hurdles hampering southern oil projects.
The oil dispute has been accompanied by an increase in
military tensions between the two regions.
Last year Iraqi national army and Kurdish Peshmerga forces
both sent troops to reinforce their rival positions around towns
dotted along the disputed territories, including the sensitive
ethnically mixed town of Kirkuk.