Iraq's Allawi due in Russia for oil, debt talks

MOSCOW, Dec 3 (AFP) - Iraqi Prime Minister Iyad Allawi arrives Monday in Moscow for the first time since taking office six months ago with hopes of soothing tensions over Russia's opposition to the US-led war in his ravaged nation.
The US-backed Allawi is due to meet Russian President Vladimir Putin at some point before his departure Wednesday and both sides said the talks would focus on future economic prospects rather than the diplomatic bitterness over the war.
Officials said Russia would try to win back lucrative oil contracts it signed under Saddam Hussein's regime in exchange for Moscow's promise to write off 90 percent of Iraq's eight billion dollar Soviet era debt.
Iraq tore up most of the oil deals amid confusion over the approaching war and despite furious protests from such Russian oil giants as LUKoil.
Russia had vigorously opposed the US-led war, in part because of fear of losing its oil interests.
"Both sides are discussing the question of expanding Russia's involvement in post-crisis Iraq," said Russian foreign ministry spokesman Alexander Yakovenko.
This involvement must "include previously signed agreements," he said in a clear reference to the oil deals.
LUKoil, Russia's second-largest producer, had major interests in Iraq under Saddam and is now holding talks with the current oil ministry in Baghdad for authorization to extract Iraqi oil.
The company is trying to win back the Iraqi market through US major ConocoPhillips, to whom it sold a 10 percent stake earlier this year under an agreement that the US side would push the Russians' interests in the Iraqi oil industry.
LUKoil in 1997 signed a contract worth several billion dollars to develop Iraq's vast West Qurna 2 field. But it was expelled from the country before the start of the war in March 2003.
Iraq's ambassador to Moscow, Abdel Mustafa, told ITAR-TASS that "Russian companies have great experience in Iraq and many of them are interested in returning to the country."
"Iraq thinks very highly of Russia's decision to write off 90 percent of the staff," Mustafa said. "There are no problems between our two countries."
But he gave no hint of any specific agreements and said only that LUKoil would invite 150 Iraqis to Russia for training in the oil industry.
Separately, the Russian foreign ministry said Moscow supported US George W. Bush's insistence that new general elections be held in Iraq on January 30 despite pressure from some camps to cancel the vote because of the violence.
"Elections to the transitional national assembly will be a major landmark" for achieving democracy in Iraq, Yakovenko said.
But Russian officials have repeatedly made it clear that they feel vindicated in their decision to oppose the war as the country spirals through waves of deadly insurgent attacks.
Putin said in an interview published Friday that the US invasion has turned Iraq into a breeding ground for extremist groupings.
"As had been the case with Afghanistan, Iraq turned into a major hotbed of terrorist threat, a firing ground and 'incubator' for militants," Putin said.
Russia's foreign ministry meanwhile called for a "new and stronger international push from the international community" for resolving the conflict.

12/05/2004 16:33 GMT - AFP