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Russia's Gazprom Neft still interested in Kurdistan-source

MOSCOW, Oct 10 (Reuters) - Gazprom Neft , the oilarm of Russia's top natural gas producer Gazprom , isstill interested in Kurdistan's oil, a Gazprom Neft source said,rebutting reports it had frozen projects in the Iraqi province.

In August, Gazprom Neft acquired interests in two blocks inIraq's Kurdistan region, after similar moves by internationalrivals angered the central Iraqi government in Baghdad.

The International Oil Daily cited Iraqi Oil MinisterAbdul-Kareem Luaibi as saying Baghdad received a letter fromGazprom, in which the company said it had frozen the contractwith Kurdistan.

"Gazprom Neft is still working on these projects. Thecompany keeps its interest in Kurdistan," a Gazprom Neft sourcetold Reuters.

A company spokeswoman declined to comment.

Gazprom Neft already has a project in Iraq, near the Iranianborder, where it expects to produce about 15,000 barrels per dayfrom 2013.

Baghdad was angered by the plans of some internationalmajors, including ExxonMobil , to tap oil and gas in thesemi-autonomous region. The central government says the dealsare illegal.

Later on Wednesday Iraqi Prime Minister Nuri al-Maliki isdue to meet Russian President Vladimir Putin in Moscow wherethey may discuss energy issues.

Russia said on Tuesday it had signed $4.2 billion worth ofarms deals with Iraq.

(Reporting by Vladimir Soldatkin; Editing by Jason Bush andDavid Holmes)

((vladimir.soldatkin@thomsonreuters.com)(+7 495 775 1242)(Reuters Messaging:vladimir.soldatkin.thomsonreuters.com@reuters.net))

Keywords: GAZPROM IRAQ/OIL