<article><p class="lead">Iraq's Kurdistan Regional Government (KRG) has rejected a federal court ruling that declared its independent oil and gas law unconstitutional.</p><p>The federal supreme court <a href="https://direct.argusmedia.com/newsandanalysis/article/2302189">on 15 February ordered</a> all crude output from the semi-autonomous Kurdish region to be handed over to the oil ministry in Baghdad and declared the KRG's oil contracts with foreign oil firms invalid. Chevron, Dana Gas, DNO, Gazpromneft, Genel Energy and Gulf Keystone are among the international oil companies that operate in the region. </p><p>The KRG has accused the court of drawing "precedents from the centralised laws of the former Ba'ath regime" of Saddam Hussain. "Article 112 of the Constitution also stipulates that oil and gas is not within the exclusive authority of the federal government. This same article also preserves the right of the Kurdistan Region to produce and develop the region's oil and gas," it said.</p><p>The KRG has long had oversight of oil and gas development in northern Iraq's Kurdish region having created an independent legal framework for the sector in 2007. It exports heavy sour Kirkuk blend crude through a pipeline that connects the Kurdish region to the Ceyhan terminal in Turkey. The exports have been the centre of disputes with Baghdad over the KRG's portion of the federal budget. <a href="https://direct.argusmedia.com/newsandanalysis/article/2201655">Last year the KRG agreed to hand over 250,000 b/d of crude</a> to Iraq's federal oil marketing firm Somo in order to receive its share of the 2021 budget.</p><p>The KRG exported 417,000 b/d of crude last month, which was around 11pc of Iraq's total shipments, according to Somo.</p><p>This week's federal court ruling is tied to <a href="https://direct.argusmedia.com/newsandanalysis/article/2301640">wrangling over the election of Iraq's new president</a>, according to one analyst. It follows a separate ruling on 13 February that barred former foreign minister Hoshyar Zebari of the Kurdistan Democratic Party (KDP) from running as a candidate.</p><p>The election is widely viewed as a showdown between Zebari and incumbent president Barham Salih of the Patriotic Union of Kurdistan (PUK). The KDP, led by Masoud Barzani, and the <a href="https://direct.argusmedia.com/newsandanalysis/article/2301348">powerful Shia cleric Moqtadr al-Sadr</a> have been pushing for Zebari's nomination.</p><p>"It's tied to the Barzani-Sadr alliance, attempting to tell him to back off the presidency. The timing is impeccable," the analyst said. </p><p class="bylines">By Adal Mirza</p></article>
