Iraqi Cabinet Approves Draft Oil Legislation

Move Is 2nd Attempt to Establish Law; Maliki Acknowledges Shortcomings by Government

BAGHDAD, July 3 -- Iraq's cabinet has again approved draft legislation establishing a framework to manage the country's vast oil resources, Prime Minister Nouri al-Maliki said Tuesday, but has not yet acted on a potentially more contentious companion law that would govern the distribution of oil revenue.

At a televised news conference, Maliki also expressed disappointment that a "national unity government" has not been achieved as he had hoped. He said recent boycotts by some Sunni and Shiite members of parliament and cabinet ministers were "causing harm to the citizens and creating depression and disappointment."

In February, Iraqi officials heralded the cabinet's approval of a draft oil law and said it was headed to parliament for review, but disagreement halted its progress.

Kurdish officials in particular have been concerned about what power their semiautonomous region in northern Iraq would have to independently negotiate oil contracts.

Ashti Hawrami, the Kurdish regional government's minister of natural resources, said he was unsure what was agreed to on Tuesday. The text approved in February is the only acceptable draft for the Kurds, he said.

U.S. officials have insisted in recent months that progress be made on the oil and revenue-distribution measures in order to promote national reconciliation.

Maliki said the cabinet voted to approve legislation that outlines the responsibilities of a federal oil and gas council that would have the power to review contracts with oil companies. But 13 of the 37 cabinet ministers were absent; six Sunni ministers are boycotting the cabinet, as are several Shiite ministers loyal to cleric Moqtada al-Sadr.

Lawmakers said they expected stiff opposition to the draft legislation in parliament, in particular from Sunni legislators, whose territory in central Iraq does not have the proven oil reserves of the predominantly Shiite south or Kurdish north.

"We greatly object to this law and I did not attend the cabinet meeting today," said Ali Baban, the minister of planning and a member of the Sunni bloc in the government. Baban said the power of the central government to reject contracts was unclear and not adequately outlined in the legislation.

But Firyad Rwandzi, a Kurdish member of the National Assembly, sounded more optimistic. "Everything is moving forward and there is no problem" between the Kurdish regional government and the federal government, he said.

In his remarks, Maliki said he plans to "restructure the entire government" by merging some ministries and slimming the bureaucracy. In coming weeks, he said, he will attempt to appoint new ministers to fill vacancies. He called on politicians to stop boycotting the government, a move he said was an "embarrassment" for his administration.

Maliki spoke frankly about how the government has not lived up to the promise of cooperation among rival sectarian groups. "It is no shame for us to say that what we were hoping for was not achieved," he said. "But this does not mean that the government will hesitate from heading toward partnerships with all the components of the Iraqi society."