The amended oil bill -- a key plank in efforts to help unite the country's warring communities -- was endorsed by Prime Minister Nuri al-Maliki's government on Tuesday and forwarded to parliament for its first reading on Wednesday.

But the northern Kurdish administration, a key party to the negotiations on the legislation, said it had "not seen and approved the final text of the law."

"We hope that the cabinet is not approving a text with which the KRG disagrees because this would violate the constitutional rights of the Kurdistan Region," a statement from the northern regional administration said.

The draft law was first approved by the Baghdad cabinet in February but Iraq's warring Shiite, Sunni and Kurdish factions later demanded certain amendments.

The Kurdish administration said it was uncertain as to which version of the law was approved on Tuesday, although Iraqi government spokesman Ali al-Dabbagh said the latest text contained only linguistic changes to the February draft.

"While the KRG is happy with the legal committee's language improvements and restructuring of the legal text, we reject its changes to the substance of the law," the Kurdish government said.

"If it has agreed to the version that included material and substantive changes, the KRG rejects this document. We have not been informed which text the Iraqi cabinet has approved."

A number of foreign companies have already entered into contracts with the Kurdish government and the Kurds fear that the new law may lead to the termination of the deals.

In May, Oil Minister Hussein Shahristani said any contract signed before the adoption of law would be cancelled.

Kurdish officials say they will honour the contracts, and also claims to have reached an agreement with Baghdad whereby it will receive 17 percent of the country's oil revenues.

The draft law, seen by Washington as one of the key factors for ending the sectarian bloodshed in Iraq, lays down control of the country's oil wealth and how it would be distributed across the communities.

Iraq's oil reserves are largely in the Kurdish north and the Shiite south and the Sunni Arabs from the central and western regions fear they could be robbed of the revenues from the crude exports.

Oil exports are Iraq's single most important source of revenue, even after more than four years of frequent insurgent attacks on oil facilities.

US officials have repeatedly urged the Iraqis to adopt a consensus law on sharing revenues and on international investment in order to head off future conflict and allow the oil sector to develop.

Iraq's proven oil reserves, estimated at 115 billion barrels, are thought to be the third largest in the world, but since the US-led invasion production has tumbled from 3.5 million barrels per day to around two million.