Iraq on Tuesday barred U.S. energy giant Chevron from working in non-Kurdish parts of the country after it bought two exploration blocks in the autonomous Kurdish region against Baghdad's wishes.
The announcement comes after Chevron announced the acquisitions on July 19, provoking a similar response from the federal oil ministry as fellow American company ExxonMobil's exploration deal with Kurdish authorities.
“The ministry announces the cancellation of the qualification of the American company Chevron, and bars it from accessing any contract or agreement with the federal oil ministry and its companies ... unless it backs off from the contract it signed,” the oil ministry said.
The central government says all oil contracts must go through Baghdad and regards any that do not as illegal.
Chevron said on July 19 that it bought 80 percent stakes in the Rovi and Sarta blocks from India's Reliance.
The announcement came after Iraqi Prime Minister Nuri al-Maliki pledged this month to take the “necessary steps” if ExxonMobil implemented a controversial oil exploration deal with Kurdistan.
Baghdad has said in recent months that the ExxonMobil deal has been frozen, which Kurdistan has denied.
The spat over oil contracts is one of several between the central government in Baghdad and Kurdish authorities in Arbil.