Energy Iraq says it will exclude Exxon from May energy auction Reason given is Exxon's refusal to relinquish its disputed deals with Kurds

By Sinan Salaheddin Associated Press BAGHDAD (AP) -- Iraq's Oil Ministry said Thursday that the U.S. oil giant Exxon Mobil Corp. is not allowed to bid in the May energy auction because of its oil deals with the northern self-ruled Kurdish region in Iraq. The Texas-based Exxon signed contracts with the Kurds last October to search for oil in six areas, bypassing the central government in Baghdad, which maintains that it must ratify all deals. Some of the contracts cover areas located in a land claimed by both Kurds and Arabs. The deputy head of the Oil Ministry's Licensing and Petroleum Contracts Department, Sabah al-Saidi, told The Associated Press that the reason for the move was Exxon's refusal to relinquish its disputed deals with the Kurds. "Exxon has been removed from the list of qualified companies because it refused to abandon the deals with the Kurdish region as requested by the Ministry of Oil," al-Saidi said. The Kurds and Arab-led government in Baghdad have been at loggerheads over who has the final say over the development of resources. The Kurdish regional government has unilaterally signed scores of oil deals, mostly with mid-sized companies. Baghdad considers the deals illegal and blacklisted companies involved. Baghdad recently said that Exxon sent two letters assuring that it would freeze the Kurdish deals until the central government and the Kurds resolve their differences. The Kurds have maintained the contracts are still valid and that Exxon is committed to them. Exxon declined comment on the Oil Ministry's decision. Unlike the deals offered by Baghdad that pay only a fixed fee to developers for their services, the Kurds offer the more lucrative production-sharing deals under which the companies are entitled to a share of the profits. Thursday's announcement came as the ministry published the final list of 47 oil companies that are qualified to bid in the May 30-31 auction for 12 exploration blocs nationwide. Published: Fri, Apr 20, 2012