SEOUL (AFP) – Iraq has stopped crude oil exports to South Korea in protest at an exploration deal involving Korean firms in Iraqi Kurdistan, officials said Tuesday.

Iraq on January 1 suspended an annual contract with South Korea’s top refiner SK Energy to export 90,000 barrels per day, the energy ministry said.

SK Energy said it has been told to back out of the Kurdistan deal if it wants to resume the contract. “We are trying hard to resume the contract through negotiations,” a spokesman told AFP.

A consortium of South Korean firms including SK Energy signed a deal in November with the Kurdish government to explore the Bazian field, which is estimated to hold 500 million barrels of crude oil.

Iraq has demanded that the consortium led by state-run Korea National Oil Corp cancel the exploration project. The corporation has refused to abandon the deal.

Iraq has been at odds with regional governments over control of new exploration areas.

The dispute has not badly hit supplies because Iraq accounted for less then three percent of total crude imports last year, an energy ministry official said. The shortage was covered by purchases on the spot market, he said.

Seoul has about 600 troops stationed in the Kurdish region for reconstruction projects. Parliament voted in late December to keep them there for one more year.

The extension was South Korea’s fourth since 3,000 troops were deployed with a one-year mandate in 2004 at the request of the US government.