BAGHDAD, March 10 (Xinhuanet) -- Iraq's Kurdish parties and aclergy-backed Shiite alliance drafted a memorandum Thursday afterthey settled a major dispute over the status of the oil-rich cityof Kirkuk, the Qatar-based al-Jazeera TV channel reported. 

  "The two sides agreed on the main issue about the city ofKirkuk, pledging to honor the Transitional Administrative Law(TAL)," the channel quoted outgoing speaker of the interim NationalAssembly, Fuad Masum, as saying.

   The TAL, passed under the US occupation, serves as atransitional constitution until a permanent one is drawn up andratified by the end of 2005.

   The Kurds have demanded that more steps be taken in line withthe TAL's Article 58, which says the new government will holddiscussions over the return of thousands of Kurds to Kirkuk.  

   Under Saddam Hussein's regime, some 100,000 Kurds were expelledfrom Kirkuk according to a plan to Arabize the city, where Arabs,Kurds and Turkmen co-existed.

   "We have agreed to solve the issue (of Kirkuk) in two steps.Firstly, the new government is committed to normalizing thesituation in the city. Secondly, regarding annexing Kirkuk toKurdistan is to be left until the writing of the constitution,"said Masoum, a member of the Kurdish joint coalition that ran inthe Jan. 30 elections.

   The Kurdish coalition emerged the second biggest winner of thecountry's landmark elections with 77 seats in the newly-elected275-member National Assembly.

   It has been seeking a pledge on Kirkuk from the Shiite-dominatedUnited Iraqi Alliance, which swept the polls with 146 seats.   However, heated horse-trading about government posts has delayedthe first session of the new parliament and the formation of atransitional government.  Enditem