BAGHDAD, July 7 (Reuters) - Iraq's parliament will vote on a draft provincial elections law on July 15, officials said on Monday, raising the possibility the polls could still be held this year.

Prime Minister Nuri al-Maliki has said the elections, seen as crucial to national reconciliation, would be held on Oct. 1.

But legislators said last month there was little chance of getting the law passed soon enough to allow preparations for a vote by then because of various disputes over the draft.

Salim al-Jubouri, a Sunni Arab lawmaker and deputy leader of the parliamentary legal committee, said nearly all obstacles had been overcome.

"The law is due to be put before parliament at the soonest session, which is Tuesday next week," Jubouri told Reuters. A parliamentary official also said the vote would be held on July 15.

Iraq would have time to hold the elections before the end of the year if parliament passed the law this month, the U.N. special representative to Baghdad said last week.

The electoral commission has said it needs three months to prepare once the law has been passed.

Washington says the elections will promote reconciliation by boosting the participation of minority Sunni Arabs in politics. Sunni Arabs boycotted the last local polls in January 2005.

Analysts say the elections will also be the battleground for a fierce power struggle among majority Shi'ites.

Lawmakers have said debate on the law had bogged down over a dispute between Arab and Kurdish lawmakers over what to do about voting in the disputed oil-rich city of Kirkuk in northern Iraq.

Jubouri said Kirkuk was one of the main unresolved issues.

Minority Kurds, who run the largely autonomous northern Kurdistan region, see Kirkuk as their ancient capital and want a constitutionally mandated referendum to be held to decide who controls the city.

Arabs encouraged to move there under late Iraqi ruler Saddam Hussein want the city to stay under central Iraqi government control and have been wary of a vote.

(Reporting by Wisam Mohammed, Writing by Dean Yates, Editing by Mark Trevelyan)

AlertNet news is provided by