BAGHDAD, Sept 24 (Reuters) - Iraq's oil ministry hopes to sign contracts with international firms before the year-end even if a new oil law governing the sector has not been passed by parliament, Oil Minister Hussain al-Shahristani said on Monday.

Shahristani told Reuters in an interview that the new contracts will be in line with rules and guidelines contained in the landmark draft oil law, which he said had been delayed by political infighting.

"As a responsible ministry, we cannot keep waiting. There is no legislative vacuum. The current laws allows the oil ministry to negotiate with firms and to sign contracts," he said.

"We are going to commit ourselves to the draft (oil law) in signing contracts by having free competition and total transparency and announce contracts which achieve the best interests for Iraq."

Iraq's cabinet first agreed a draft law for dividing up the world's third largest oil reserves in February, but disputes with the regional government in Kurdistan, as well as objections from some Shi'ite and Sunni Arab politicians, have hobbled its progress.

Major oil companies such as Total (TOTF.PA: Quote, Profile, Research), Royal Dutch Shell (RDSA.L: Quote, Profile, Research) and Exxon Mobil (XOM.N: Quote, Profile, Research) have been positioning themselves to gain access to Iraq's prized oilfields, especially those in the south.

While the industry generally prefers long-term production sharing contracts to develop larger investments, the Iraqi oil minister signalled more restrictive service contracts may be the way forward.

"We have explored fields whose reserves and production rates we know very well so ... this only needs service contracts," Shahristani said.

"For super giants like northern and southern Rumaila and Zubair, we may only need service contracts," he added.

He said he hoped the tender process for developing oilfields could begin before the end of the year.

"We have (also) formed a new office, which is called the office of oil contracts and licenses, and it has prepared contract models and a plan for developing fields," he said.

"Which fields will be listed in the first round and which in the second is under final review. We will begin the first round before the end of this year."