Oily truth emerges in Iraq

[Graham Saul]

Hi folks,

 

As you know, the World Bank, the IMF and USAID, among others, have been actively involved in efforts to design new rules for Iraq's oil sector (see, for instance, 

"Oil Aid and the Battle for Control of Iraq's Oil", posted January 3rd at: http://groups.google.com/group/oil-aid-news ) Below you'll find a disturbing New York Daily News article that talks about a "proposed new Iraqi oil and gas law [that] began circulating last week among [Iraq's] top government leaders."

 

Please distribute widely.

 

Graham Saul

Oil Change International

www.priceofoil.org

 

 

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http://www.nydailynews.com/news/col/jgonzalez/

New York Daily News - http://www.nydailynews.com
Oily truth emerges in Iraq
Juan Gonzalez

Wednesday, February 21st, 2007

Throughout nearly four years of the daily mayhem and carnage in Iraq,
President Bush and his aides in the White House have scoffed at even
the slightest suggestion that the U.S. military occupation has
anything to do with oil.

The President presumably would have us all believe that if Iraq had
the world's second-largest supply of bananas instead of petroleum,
American troops would still be there.

Now comes new evidence of the big prize in Iraq that rarely gets
mentioned at White House briefings.

A proposed new Iraqi oil and gas law began circulating last week among
that country's top government leaders and was quickly leaked to
various Internet sites - before it has even been presented to the
Iraqi parliament.

Under the proposed law, Iraq's immense oil reserves would not simply
be opened to foreign oil exploration, as many had expected. Amazingly,
executives from those companies would actually be given seats on a new
Federal Oil and Gas Council that would control all of Iraq's reserves.

In other words, Chevron, ExxonMobil, British Petroleum and the other
Western oil giants could end up on the board of directors of the Iraqi
Federal Oil and Gas Council, while Iraq's own national oil company
would become just another competitor.

The new law would grant the council virtually all power to develop
policies and plans for undeveloped oil fields and to review and change
all exploration and production contracts.

Since most of Iraq's 73 proven petroleum fields have yet to be
developed, the new council would instantly become a world energy
powerhouse.

"We're talking about trillions of dollars of oil that are at stake,"
said Raed Jarrar, an independent Iraqi journalist and blogger who
obtained an Arabic copy of the draft law and posted an
English-language translation on his Web site over the weekend.

Take, for example, the massive Majnoon field in southern Iraq near the
Iranian border, which contains an estimated 20 billion barrels. Before
Saddam Hussein was toppled by the U.S. invasion in 2003, he had
granted a $4 billion contract to French oil giant TotalFinaElf to
develop the field.

In the same way, the Iraqi dictator signed contracts with Chinese,
Russian, Korean, Italian and Spanish companies to develop 10 other big
oil fields once international sanctions against his regime were
lifted.

The big British and American companies had been shut out of Iraq,
thanks to more than a decade of U.S. sanctions against Saddam.

But if the new law passes, those companies will be the ones reviewing
those very contracts and any others.

"Iraq's economic security and development will be thrown into question
with this law," said Antonia Juhasz of Oil Change International, a
petroleum industry watchdog group. "It's a radical departure not only
from Iraq's existing structure but from how oil is managed in most of
the world today."

Throughout the developing world, national oil companies control the
bulk of oil production, though they often develop joint agreements
with foreign commercial oil groups.

But under the proposed law, the government-owned Iraqi National Oil
Co. "will not get any preference over foreign companies," Juhasz said.

The law must still be presented to the Iraqi parliament. Given the
many political and religious divisions in the country, its passage is
hardly guaranteed.

The main religious and ethnic groups are all pushing to control
contracts and oil revenues for their regions, while the Bush
administration is seeking more centralized control.

While the politicians in Washington and Baghdad bicker to carve up the
real prize, and just what share Big Oil will get, more Iraqi civilians
and American soldiers die each each day - for freedom, we're told.

jgon...@nydailynews.com