Baghdad has put plans to create a new national oil company on hold until a new government is formed, industry sources have told Offshore Technology sister publication MEED.

At stake is who controls the purse strings when it comes to dealing with the country’s oil fortune once the new company has been established.

“This is a key issue that has not been decided,” say oil executives in Iraq. “It will be either the oil ministry or the national oil company.”

Lawmakers passed a new law in March to establish the new national oil company.

At the time, officials said the new company would serve as an umbrella organisation for existing Iraqi state oil firms, leaving the ministry free to concentrate on broader strategic objectives for the development of the Iraqi energy sector.

Sources have told MEED that the new national oil company will be modelled on the structure used by the Abu Dhabi National Oil Company (Adnoc).

Iraq is still a long way from forming a new government after its election on 12 May.

The election delivered a surprise win for Shia cleric Muqtada al-Sadr, but his Sa’iroun political bloc fell short of the majority needed to govern.

The final results are yet to be approved by the federal court, and the winning coalitions haven’t been able to form a new government.

The last parliament’s term ended on 31 June.

This article is sourced from Power Technology sister publication, a leading source of high-value business intelligence and economic analysis about the Middle East and North Africa. To access more MEED content register for the 30-day Free Guest User Programme.