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Tue 23 Dec 2008 10:17 AM

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Iraq oil revenues immune from claims until '10

UN passes resolution to allow gov't to use money to help rebuild country.

Iraq's energy revenues will be immune from financial claims through 2009 under a resolution passed by the UN Security Council on Monday.

A US- and British-drafted resolution, passed by all 15 council members, also agreed to a Baghdad request for a review of past council resolutions on Iraq dating back to the Saddam Hussein era with the aim of terminating outdated ones.

Two months after the US-led invasion that toppled Saddam in 2003, Iraq's oil and gas proceeds were put into a development fund for the country. An international board monitors the fund, now held in Baghdad.

The Security Council ruled at the time that the proceeds would be immune from seizure under legal claims. Iraq is still laden with debts and claims inherited from Saddam, notably from Kuwait, which the former Iraqi leader invaded in 1990.

Since then, the immunity has been renewed as part of an annual resolution to authorise foreign forces in Iraq. That authority lapses on Dec. 31 and is being replaced by bilateral accords between Iraq and individual countries, so this year's resolution was confined to the energy revenues issue.

"We need the assurances that Iraq's resources and financial assets are available for the country's recovery program," Foreign Minister Hoshiyar Zebari told the council.

"Without such assurances, the functioning of the Iraqi government and the current stability could be seriously endangered."

But he said Iraq, which sits on the world's third-largest oil reserves, was "fully committed to the resolution of all legitimate claims", in particular settlements stemming from the invasion of Kuwait.

US Ambassador Zalmay Khalilzad said the extension, which lasts until the end of 2009, would give the Iraqis time to work on plans for dealing with claims.

"I think this was very important. Without such support the progress could have been put at risk," he told reporters.

The council also decided to review its resolutions on Iraq beginning in 1990, some of them imposing sanctions on the Saddam government.

"It's right that we now overhaul their provision with a view to their termination as soon as is feasible," British Ambassador John Sawers told the council.

The council asked UN Secretary-General Ban Ki-moon to consult with Iraq on the issue and report back.

To replace the UN mandate over foreign forces in Iraq, the Baghdad parliament last month approved a security pact with the United States that paves the way for US forces to withdraw by the end of 2011.

But approval of a similar measure that would allow troops from Britain, Australia and some other nations to stay on fell hostage on Monday to a political row in Iraq's parliament. The speaker suspended the body's regular session until Jan. 7 after deputies demanded he stand down over an alleged insult.

In his speech to the council, Zebari paid tribute to the countries that had sent troops to Iraq, some of them at considerable cost in money and lives. The United States has lost over 4,200 citizens there, mainly in insurgent attacks.

"Iraq owes you a debt of gratitude," Zebari told the troop contributing countries, "and we share our condolences with you for the sacrifices that this historic struggle has required."

He said that partly due to a big decrease in attacks "this year we have achieved remarkable progress and turned a vital corner towards the stabilization and recovery of my country".