Democrat Party leaders endorse Oil Law

Representative Dennis Kucinich wrote to fellow Democrats urging them to remove passage of the oil law as a required "benchmark" for the Iraqi government as part of the US Congress' Iraq supplemental spending bill. The Democratic leadership debated it behind closed doors, but ultimately has left the reference to the law in. Representative Kucinich has vowed to offer an amendment to strip the language, but Democratic leaders are likely to rule it out of order. (more details)

EDM in British Parliament

Katy Clark has tabled Early Day Motion 1180 with cross-party co-sponsorship, please encourage your MPs to sign it: "That this House notes that Iraq's economy is heavily dependent on oil and that decisions about the future of Iraq's oil industry will have a major bearing on that country; further notes that the constitution of Iraq states that oil and gas are owned by all the people of Iraq; expresses concern that the British Government, in its involvement in the drafting of Iraq's new oil laws, has sought the views of international oil companies regarding the possible types of contracts that the Iraqi Government should offer; believes that decisions on the Iraqi oil industry should be made by the Iraqi people without outside interference; and calls on the Government to disclose to the House all representations it has made in relation to the oil law."

Oil Companies to meet Iraqi government in May

The International Tax and Investment Centre is an industry lobbying body that arranged an initial meeting between oil companies and the Iraqi government in Beirut in January 2005. It has now scheduled a second meeting on 9-11 May 2007. Oil companies and the IMF will meet with representatives from the Ministries of Finance and Oil and the Central Bank. Oil companies present are likely to be: BP, Chevron, Eni, ExxonMobil, Shell, Total, ConocoPhillips and Lukoil.

Analsyis of Oil Law by Munir Chalabi

UK-based Iraqi political analyst Munir Chalabi has written a political analysis of the oil law. which he says "seems to be no less than the old concessionary model in a new guise." He notes that a key part of the draft have not yet been released: "The three appendices, which will specify which parts of the already discovered giant oil fields will be counted as "existing producing fields" and which will be counted as "not yet developed fields" that are partially or not yet producing oil. This judgment will decide which oil fields will be allocated to the Iraqi National Oil Company (INOC) and which of the existing fields will be allocated to the IOCs (from 10% to up to 80%).

He also notes that "This is the wrong timing for introducing such a strategic oil law. As several articles of the Iraqi constitution, including articles 112,113, and 115, are under review and there is the possibility that some of these articles will be changed within the coming months, it would be unwise to base such an important law on unknown constitutional articles. It is likely that the new oil law will contradict the new articles of the constitution. On the other hand, if articles 112 and 115 are altered as expected, it will possibly remove the fears of some experts regarding the tendency within the law to lead to sectarian and regional agendas."

He recommends that a full oil law should only be developed after the occupation ends. But suggest that "It will be in the Iraqi people's interest to have a "provisional oil law" which re-establishes INOC and gives it full decision-making powers similar to what was stated within Iraqi laws 123 and 130 of 1967, until such time comes when Iraq is no longer under occupation. Furthermore the provisional oil law should permit only a short-term contract between INOC and the international oil companies so as to provide technical help to develop the existing oil fields."

On a historican note, he says the Ba'ath regime made moves to privatise Iraq's oil but were inhibited from doing so fully because of sanctions: "The first step which was taken by the Baathist government was in 1987 when they dissolved INOC... Two PSA agreements were signed with the Russians. This includes the 1997 twenty three year agreement with the Russian oil company, Lukoil, for the development of the West Qurna-2 giant oil field. The third PSA agreement was signed in 2000 with the Chinese National Oil Company."

BG visits Kurdistan

The Telegraph breaks the news that BG Group, the British oil and gas explorer, recently visited the Iraqi Kurdistan to investigate opportunities for gas exploration. Until now, only minnows, such as Norway's DNO, and Aim-listed companies Petrel Resources and Sterling Energy, have signed deals with the KRG. BG Group declined to comment.

Iraqi Politicians Urge Rejection Of Draft Oil Law

Dow Jones Newswires reports on a conference of prominent Iraqi parliamentarians, politicians, ex-ministers and oil technocrats in Amman yesterday, hosted by the Iraqi Centre for Strategic Studies. The conference urged the Iraqi parliament to reject Iraq's controversial hydrocarbon law, fearing that the new legislation would further divide the country already witnessing civil strife.

Mohammed Bashar al-Faidhi, spokesman of the Association of Muslim' Scholars said: "We call on members of the parliament to reject this law. This critical draft law would revive foreign companies' control on Iraqi oil wealth that Iraq had gotten rid of years ago." Faidhi said. Saleh al-Mutlak, head of the National Dialogue party said: "Iraqis are suspicious that if the law is passed at this critical time that Iraq is passing through, they would think it would be passed in order to serve the interest of foreign companies. This law would also further divide the Iraqi people because most of them would oppose it." Issam al-Chalabi, former Iraqi oil minister during the government of Saddam Hussein, criticized the draft oil law, saying prominent Iraqi oil experts weren't allowed to take part in discussions of the legislation and that it wasn't published in the media in order that the Iraqi people could see it, he said "Enough time should be given to draft the law before submitting it to the parliament for approval." Mohammed al-Jobouri, trade minister during Allawi's cabinet, said, "Iraq needs a hydrocarbon law, but the timing of the law isn't suitable. There are some loops in the law that needs more discussions." Other parties represented in the meeting were Allawi's Iraqi List and the Iraqi Accord Front headed by Adnan al-Dulaimi. Neither the Shiite United Iraqi Alliance, the largest bloc in the parliament, nor the Kurdish Coalition attended.

Exposed: British government pushing oil interests in Iraq

The British government has been using its position as a military occupation power to push the interests of oil corporations in Iraq, according to PLATFORM, a founding member of Hands Off Iraqi Oil. Documents it obtained through the Freedom of Information Act reveal extensive efforts since at least 2004 to push for companies such as BP and Shell to receive long-term contracts, which would give them exclusive rights to extract Iraq's huge oilfields. British diplomats in Baghdad and civil servants in Whitehall have worked with oil company lobbyists, helping them obtain direct contact with Iraqi decision-makers, and have been closely involved in shaping the oil law, which was approved by the Iraqi cabinet last week. The findings will be revealed this evening in a documentary on al-Jazeera's English-language channel, as part of its 'People and Power' series.

Six oil companies – BP, Shell, ExxonMobil, Chevron, Total and ENI – worked through a lobbying organisation known as the International Tax and Investment Centre (ITIC), which has pushed for production sharing agreements. The UK government documents that PLATFORM has obtained show that:

• Foreign Office and Treasury officials advised ITIC in late 2004 on their strategy for influencing the Iraqi government.
• The British Ambassador to Iraq formally sent ITIC’s lobbying document "Petroleum and Iraq’s Future: Fiscal Options and Challenges" to the Iraqi Finance Minister.
• A British diplomat helped organise a meeting in Beirut in January 2005, at which the oil companies put their case directly to ministers and officials of the Iraqi Ministries of Oil, Finance and Planning.
• The Foreign Office hired a former BP executive to lead its work on Iraqi oil policy in 2003 and 2004. He wrote a ‘Code of Practice’ for the Iraqi Oil Ministry, which called for multinational companies to play the major role in developing Iraq’s oil, and for the Ministry's policies to be compatible with those of BP.

Greg Muttitt of PLATFORM commented: “That Iraq’s oil law was shaped by outside interests, bypassing even members of the Iraqi parliament, gives the lie to the claims that the US/UK agenda was to bring democracy to Iraq. But it also raises serious questions about our own democracy: whether the government is representing British citizens, most of whom opposed the decision to go to war, or whether in Iraq it is in fact representing a few wealthy oil corporations”.

English translation of draft Oil Law

The KRG has today published its official English translation of the draft Oil Law agreed by the cabinet on 15 Feburary. The arabic original is also available through the same link. KRG Natural Resources Minister Dr. Ashti Hawrami said: “Old and inaccurate translations of this vital draft law have been circulating in the media in recent weeks. By publishing the original Arabic and the authoritative English translation together, we hope to make the picture clearer for potential investors in Iraq.”

KRG demands

The KRG press release accompanying the new english translation says: "The KRG has also voluntarily agreed that existing KRG petroleum contracts, which are explicitly validated by the Iraq Constitution, may also be reviewed by a panel of independent advisors." It continues: "The 15 February draft has not yet been introduced to the Iraq Council of Representatives (the Parliament), pending the completion of related matters. The Oil and Energy Committee will next prepare the four critical Annexes referred to in the draft Oil and Gas Law, which allocate the management of particular petroleum fields and exploration areas in Iraq to the KRG, the Iraq National Oil Company, and the Iraq Ministry of Oil. The Committee also needs to agree model petroleum contracts and guidelines for contractual terms, without which no investment in Iraq can begin. The Kurdistan Regional Government has agreed with the Federal Government that it will support the draft Federal Oil and Gas Law provided that the Annexes and other documents are concluded to the KRG's satisfaction, and if it is accompanied by an agreed Revenue Sharing Law for submission as a package to the Council of Representatives. " Minister Hawrami adds: “We must make sure that the Federal Government, like Kurdistan, is doing all it can to attract new investment to Iraq. It is vital that the Federal Government adopt the same market-friendly approach that the KRG has been using in its contracts.”