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Published on Thursday, July 3, 2008 by Reuters

US Officials Condoned Hunt-Kurd Oil Deal-Documents

U.S. officials condoned Hunt Oil Co efforts to obtain an exploration deal with Iraq's Kurdish regional government, contrary to public statements discouraging it, according to documents cited by a congressional committee.

When the agreement was announced in September, it was criticized as undermining efforts to strengthen Iraq central government, which still had no national oil revenue-sharing law.

Bush administration officials expressed public concern and denied any knowledge of the contract.

On Wednesday, U.S. Rep. Henry Waxman released e-mails and letters obtained by the House Oversight and Government Reform Committee that appeared to show the opposite.

"Contrary to the denials of administration officials, advisors to the president and officials in the State and Commerce Departments knew about Hunt Oil's interest in the Kurdish region months before the contract was executed," Waxman, a California Democrat, wrote in a letter to Secretary of State Condoleezza Rice.

In one e-mail, Hunt Oil's general manager wrote: "There was no communication to me or in my presence made by any of the 9 state department officials with whom I met ... that Hunt should not pursue our course of action leading to a contract. In fact, there was ample opportunity to do so, but it did not happen."

Spokesmen for the State Department and Hunt Oil were not immediately available for comment.

State Department spokesman Tom Casey said on Wednesday that "we continue to stand by our previous statements that he U.S. government made its objections to this arrangement known both to the company as well as to the KRG (Kurdistan Regional Government)," The Washington Post reported.

Waxman's office released documents dating to June 2007, saying they raised questions about U.S. involvement in recently announced negotiations between the Iraqi government and major U.S. and multinational oil companies.

He told Rice he was seeking information about a possible U.S. role in the efforts of those companies to obtain Iraqi contracts.

"You and other administration officials have denied playing any role in these contracts. In the case of Hunt Oil, however, similar denials appear to have been misleading," Waxman wrote.

The government of Iraq's northern Kurdish region announced on September 8, 2007, that it had signed a gas and oil production sharing contract with a unit of Hunt Oil and with Impulse Energy Corp.

Hunt Oil Chief Executive Ray Hunt denied that his ties to the Bush family and the Republican Party helped his company cut a deal with the largely autonomous region.

Hunt said in a Wall Street Journal interview in October the company received no government advice before striking the deal.

"The fact is, as a matter of policy, we never have and never will go to the government of the U.S. and ask the government's advice on anything we do from a business point of view," he was quoted as saying.

Iraq has the world's third-largest oil reserves, which are mainly in the north and the south of the country.

Kurdish officials have clashed with Baghdad over the national oil law, which will determine how contracts are awarded and how revenues are distributed. The northern Iraqi region has signed several exploration deals with foreign firms, which Baghdad says are illegal.

Reporting by JoAnne Allen; Editing by Doina Chiacu

© 2008 Reuters

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