AFP cited Mr Barham Saleh PM of north Iraq's autonomous Kurdistan region as saying that oil deal the region signed with ExxonMobil against Baghdad's wishes is constitutional.

Mr Barham Saleh said that the contract that we signed with ExxonMobil is a complete and constitutional contract and is not against the constitution. We have different points of view with the officials in Baghdad on a number of issues but it does not mean that we are acting against the Iraqi constitution.

If they think that we will abandon our constitutional right to deal with our natural resources they will be wrong. Baghdad regards any contracts not signed with the central government as invalid.

Mr Ashti Hawrami Kurdistan's minister of natural resources said that Kurdistan on October 18 inked the deal with ExxonMobil for it to explore 6 areas. But an official with the Iraqi oil ministry said that two of those areas Al-Qosh and Bardarash are actually parts of Nineveh province that Kurdistan wants to annex into its autonomous region, a move Baghdad opposes.

The Kurdistan contract potentially puts an Exxon contract with the Iraqi government in jeopardy. In January 2010, Iraq's oil ministry completed the deal with ExxonMobil and Anglo and Dutch giant Shell to develop production at West Qurna-1 which with reserves of about 8.5 billion barrels is the country's second biggest field.

(Sourced from Reuters)