The referendum to decide the future of Kirkuk will most likely be delayed into 2008 as incomplete preparatory steps and internal debate has bogged down the process

Below are extracts from an article by Sumheda Senanayake for Radio Free Europe/Radio Liberty:

Since the ratification of the Iraqi Constitution in 2005, Iraq's Kurds have viewed the issue of the Kirkuk referendum as a "red line." They have held steadfast that Article 140 of the constitution be implemented to determine the political future of the oil-rich governorate, which is estimated to hold 6 percent of the world's oil reserves.

Article 140 calls for a three-step process, starting with "normalization," which aims to reverse the Arabization policies of the former regime, when thousands of Kurds and non-Arabs were driven from Kirkuk or were relocated and replaced with Arabs from central and southern Iraq. This is to be followed by a census and then a referendum -- scheduled to be held at the end of 2007 -- to determine whether Kirkuk Governorate will be incorporated into the semi-autonomous Kurdish region.

The Kurds have stood firm in their desire to see Article 140 implemented and hope that Kirkuk will become part of the Kurdish region. […]

However, there are clear indications that the referendum may not take place as previously planned. The Firat news agency reported on September 10 that the Kurdish Alliance had agreed to postpone the referendum until May 2008. The alliance, which unites the two most powerful Kurdish parties, was clear to stress that the postponement was due entirely to technical reasons and not political pressure exerted by opponents of Article 140.

Signs Point To Delay

Rumors of a delay have been circulating for weeks. On August 16 [2007], U.S. Ambassador to Iraq Ryan Crocker said it seemed highly improbable that the referendum would take place by the end of the year, citing the lack of preparation, sectarian wrangling, and missed deadlines.

The original timetable called for the census to be conducted by the end of July [2007], but the normalization process is far from complete. In fact, the normalization process continues to be bogged down by technical problems and internal bickering. The Iraqi government on August 2 [2007] appointed Ra'id Fahmi as the new chairman of the committee charged with carrying out the implementation of Article 140, after the former chairman, Hashim al-Shabali, resigned.

The committee continues to wrestle with the sensitive issue of how to implement the normalization process, which inevitably involves removing Arab setters who were brought in during Saddam Hussein's Arabization program. While the committee has steadfastly denied that Arabs would be forcibly relocated, it adopted a controversial plan in early February [2007] to entice Arab families to voluntarily leave Kirkuk in exchange for a compensation package of approximately $15,000 and a plot of land to return to in their town of origin.

However, some critics of the plan describe it as tantamount to gerrymandering ahead of the referendum, while others call it another form of forced migration. The Sunni-led Muslim Scholars Association issued a statement on September 11 [2007] warning that the plan would harm the integrity of Iraq and lead to its eventual partitioning. "The conspiracy to divide Iraq enters a grave phase with the occupation puppet government officially encouraging through financial incentives, to expel Kirkuk's Arabs and facilitate their transfer to other regions of Iraq," the statement said.

Finally, there is the specter of violence among the Kurds, Turkomans, and Arabs who all have a stake in Kirkuk. There is a fear that holding the referendum in the ethnically mixed governorate could lead to the type of sectarian bloodshed that has gripped Baghdad and central Iraq.

Oil Deal Sends A Message

Considering the circumstances, the Kurdish regional government (KRG) may have had no choice but to acknowledge that a postponement of the referendum was inevitable. However, the anticipated postponement of the referendum may have emboldened the KRG to sign a production-sharing contract on September 8 [2007] with the U.S.-based Hunt Oil Company and Impulse Energy Corporation to conduct petroleum exploration in northern Iraq.

The deal was roundly denounced by Iraqi Oil Minister Husayn al-Shahristani, who described it as illegal, since it was not approved by the central government in Baghdad. The KRG previously signed several contracts with foreign firms, all which have been condemned by al-Shahristani and the Baghdad government. This was the first contract the KRG signed with a foreign corporation since passing its own hydrocarbons law in early August [2007].

The new oil contracts were certain to roil the Baghdad government, which has yet to pass its own oil and gas law after nearly a year of negotiations. While there is no doubt that the KRG was in negotiations with the two foreign firms, the timing of the deal sends a message that the Kurds are determined to control the resources in their region, in light of the Kirkuk referendum postponement.

Indeed, the postponement of the Kirkuk referendum, particularly after Kurdish leaders were so insistent that it be conducted by the end this year, was bound to create a certain degree of anxiety among the Kurds. What the Kurds worry about most is that the delay may become an open-ended postponement, which may leave the status of Kirkuk languishing indefinitely.