WASHINGTON (AP) – The State Department on Thursday denied charges by a House committee that it inappropriately encouraged a Texas-based oil company to strike an exploration deal with the Kurdish government in Iraq.

Hunt Oil Co.’s contract with the Kurds, reached last September, had angered Iraq’s central government in Baghdad, which said any deals with foreign companies should not be signed until lawmakers agreed on how the nation’s oil revenues would be divided. The issue remains unresolved and continues to be among the most contentious within the Iraqi Parliament.

State Department spokesman Sean McCormack told reporters that the department had advised all U.S. oil companies, including Hunt Oil Co., against making any deals in Iraq before the hydrocarbons law passed because it would aggravate political tensions.

If individuals had encouraged the deal, their actions would have been “contrary” to official administration policy, he said.

“We advised anybody who came to us that absent a hydrocarbons law they should defer signature of any contracts with any subregional institutions in Iraq,” he said. “That policy was conveyed.”

But according to an investigation by the House Oversight and Government Affairs Committee, led by Rep. Henry Waxman, D-Calif., there is no evidence that the administration tried to dissuade the company, which is headquartered in Dallas. Further, the committee’s review of e-mail messages and other documents show that in some cases, State Department and other administration officials seemed to encourage the deal.

In one instance, a State Department regional coordinator wrote in an e-mail that he was glad to hear of Hunt Oil’s efforts.

“Getting an American company to sign a deal with the (Kurds) will make big news back here,” he told a colleague. “Please keep us posted.”

Another State Department official stationed in Iraq notified Hunt Oil of a second business opportunity and offered to provide additional information if they wanted it.

The messages would have run counter to public statements made by State Department officials in Washington at the time. State Department spokesman Tom Casey told reporters in September that the administration saw the deal as unhelpful. In October, the department’s chief liaison to Congress, Jeffrey Bergner, told lawmakers that the administration warned Hunt Oil that such contracts would “needlessly elevate tensions” between the Kurds and Iraq’s central government.

According to notes taken by Hunt Oil officials at a June 2007 meeting with U.S. officials in Iraq, the company was told specifically that the U.S. had no policy on the contracts.


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