ERBIL, Kurdistan Region of Iraq – The United States on Tuesday reiterated its support for the recently-signed energy agreements between the Kurdistan Regional Government (KRG) and American firms, calling on Baghdad and Erbil to work together amid circulating reports of an Iraqi lawsuit against the deals.

Kurdistan Region Prime Minister Masrour Barzani last week oversaw the signing of two agreements in Washington DC, one with HKN Energy and ONEX Group, and another with WesternZagros. The deals have a combined value of around $110 billion, and aim to boost the Kurdistan Region’s energy sector.

“The United States supports economic deals that benefit all Iraqis, including the two announced last week,” US State Department Spokesperson Tammy Bruce told reporters on Tuesday. “We encourage Baghdad and Erbil to work together to expand domestic gas production as soon as possible.”

The Iraqi oil ministry has rejected the recent agreements, claiming that the procedures violate a 2022 Iraqi federal court ruling prohibiting Iraqi regions and provinces from regulating trade policy with other countries.

“These types of economic partnerships will benefit both the American and Iraqi peoples and help Iraq move toward energy independence,” Bruce added, expressing hope for further investment by American companies across Iraq.

The KRG’s natural resources ministry has responded to Baghdad’s comments, stating that the agreements are constitutionally valid and have been previously approved by Iraqi courts.

International news outlets have in recent days reported that the Iraqi federal government’s oil ministry has filed a lawsuit against the KRG over the recent agreements, calling for their cancelation. There has been no official confirmation on the case from either side as of the writing of this article.

“As far as the nature of the lawsuits…. Obviously, we are looking forward to continuing these kinds of deals. We expect these kinds of deals to flourish, and expect and would hope that they would be facilitated,” the State Department spokesperson added on Tuesday.

As a guest on The New Region’s GeoSpace X series on Tuesday, Sajad Jiyad, Century International Fellow and Director of the Shia Politics Working Group, said that these sorts of disputes will continue as long as Baghdad and Erbil do not have a mechanism to manage the oil and gas sector.

“Most of the politicians in Baghdad have been raised on the culture of centralization. The fact that decisions need to be made in Baghdad, deals need to be struck with Baghdad, money needs to flow in and out of Baghdad,” said Jiyad.

 “Federalism has not been implemented properly in Iraq. I think that is a fact,” he added.

KRG Cabinet Secretary Amanj Raheem last week argued that the Iraqi constitution “clearly” authorizes the Kurdistan Region to develop its natural resources. “Unfortunately, till now the federal government has failed to implement the federalism system in this regard,” Raheem noted.