US urges Iraq to work with KRG on paying energy companies’ debts

ERBIL, Kurdistan Region - US National Security Advisor Michael Waltz on Monday urged the Iraqi government to work with the Kurdistan Regional Government (KRG) to pay the debts of US energy companies and called on Baghdad to encourage greater American investment after a waiver for importing Iranian gas was rescinded.

Waltz “urged the Iraqi government to work with the Kurdistan Regional Government to address remaining contract disputes and pay arrears owed to U.S. energy companies,” he said on X, after a phone call with Iraqi Prime Minister Mohammed Shia’ al-Sudani.

During the call, Waltz also encouraged Baghdad to welcome more American energy companies and praised Sudani’s efforts to achieve energy independence for Iraq. He also “requested that the Iraqi government retain an investment coordinator to work with U.S. companies seeking to invest and operate in Iraq.”

On Sunday, the US rescinded a waiver that permitted Iraq to purchase electricity from Iran as part of President Donald Trump’s maximum pressure campaign against Iran, which also aims to drive Tehran’s oil exports down to zero.

Waltz confirmed to Sudani that the decision to rescind the waiver was part of Trump’s maximum pressure campaign.

A statement from Sudani’s office also said that Waltz reaffirmed Washington’s “commitment to supporting Iraq’s energy independence and expressed readiness to cooperate in accelerating progress toward this goal.”

Iraq is heavily reliant on Iranian gas imports to support its electricity production. Previous waivers from Washington allowed Baghdad to bypass American sanctions on Tehran as a short-term stopgap until it is able to wean itself off of Iran for its energy needs.

A US State Department spokesperson told Rudaw on Sunday that Washington is hoping that the Iraqi government will start benefiting from the natural gas capabilities of the Kurdistan Region after the waiver, to reduce its dependence on Iranian gas.

Iraqi government spokesperson Bassem al-Awadi on Saturday told Rudaw that Baghdad had all necessary preparations in place in case the US revoked its waiver.