IHL estimates for Iraqi oil reserves

A soon to be released commercial survey of Iraq's oil fields the "Iraq Atlas" by IHL concludes that there could be an additional 100 billion barrels of oil (on top of the known 116 billion), mainly in the unexplored Western Desert. IHL's press release says: "In 2007, the Iraqi government is expected to launch a bid round for 65 exploration blocks and 78 fields are also to be offered for development. The Iraq Atlas will help companies evaluate these blocks and fields quickly and accurately... The cost to produce oil in some Iraq fields is less than $2 per barrel according to our estimates and investments involved in developing the fields are minimal." Given that the oil is potential cheap and easy to extract, it is unclear to HOIO why foreign investment is needed at all.

BP warned against Iraq oil ‘rip-off’ at AGM

10.30am, THURSDAY 12 APRIL

Excel Centre, Docklands, London

Activists from the Hands Off Iraqi Oil campaign today delivered a warning to oil company BP that it will face massive public outrage if it continues in its attempts to ‘rip off’ Iraqi oil.

They were demonstrating at the company’s Annual General Meeting in London's Docklands against the role BP has played in lobbying for a controversial new oil law in Iraq. The law would transfer control over the majority of the country’s huge oil reserves from the public sector to multinational companies, for the first time in 35 years.

BP has been at the forefront of efforts to gain access to Iraq's oil since the invasion of Iraq in 2003.

- In 2003 and 2004, successive BP executives left to work as oil advisers to the occupation authorities in Iraq, paid for by the UK government.

- One of these advisers 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.

- Since 2003, BP has also been one of six major oil companies working through a lobbying organisation called the International Tax and Investment Centre (ITIC) to push for the handover of control of Iraq's oil to transnational oil companies.

- Together with the other major oil companies, and the British government, they have pushed the Iraqi government to agree to allow companies to take control of Iraqi oil production through controversial long-term contracts known as ‘production sharing agreements’.

Jonathan Stevenson, from Hands Off Iraqi Oil, said:

“As if the devastation brought by the invasion and occupation of Iraq was not enough, Iraq’s people now face the prospect of losing billions of dollars in oil revenues to foreign companies. Civil society groups in Iraq are resisting this theft of Iraq’s future in extraordinary circumstances. We’re here to serve notice on BP, and other oil companies, that those around the world who opposed the invasion will also oppose their attempts to rip off Iraq's oil.”

Rebecca Fisher, also from Hands Off Iraqi Oil, said:

“We are here demonstrating our solidarity with Iraqis and to tell BP staff and shareholders that we know what is going on. We must stop these contracts from being signed if Iraq is ever to gain true political and economic independence.”

Iraqi Oil Union Has Storied Past

Analysis: Iraq oil union has storied past

By BEN LANDO UPI Energy Correspondent

WASHINGTON, March 29 (UPI) -- Hassan Jumaa Awad wants Iraq's oil to stay under state control, and the unionists, who have long worked the rigs, to be supported in developing the national resource. But this is no request from the president of the Iraqi Federation of Oil Unions.
It's a demand.

"Since we are working to make progress in production, we need a real participation in all the laws that are related to the oil policy," Awad told United Press International, speaking on his mobile phone from the southern port city of Basra. "We are the sons of this sector and we have the management and technical capability and we have the knowledge on all the oil fields."

The IFOU represents more than 26,000 workers organized under various unions in the oil-rich southern and northern areas of Iraq. Shiites, Sunnis and Kurds, together they've operated Iraq's oil sector before, during and after Saddam Hussein. Their rights to officially unionize are still denied under a 1978 Saddam law, one of a few of the former president's laws the U.S. occupation and the Iraqi Parliament upheld.

Iraq's oil production is still around 2 million barrels per day, down from the 2.6 million bpd before the war, but far below its potential since most of its 115 billion barrels of reserves are untapped. Investment in the world's third-largest oil market is hampered by conditions past and present, and an unknown future.

Saddam pushed certain oilfields too hard while neglecting maintenance and new technologies. The sector was hit with war starting in 2003, and now regular sabotage and a shortage of electricity.

Kurdish and central government negotiators reached a deal last month on the framework for a law governing Iraq's oil. Details on ownership rights and revenue sharing are still far from finalized. The Iraq National Oil Co. would restart but compete with foreign oil companies, who could win contracts giving them partial ownership of the respective fields.

INOC "should have full privileges," Awad said, "and we don't agree on the production partnership."

Iraq's oil has been nationalized for four decades. Iraqis view it with a pride of ownership, something the law would reduce if the contract language allowing for foreign ownership stands.

"We think that to reserve sovereignty of Iraq is to be able to control the oil wealth," Awad said, and foreign investment should be limited to technical assistance. "I wish if the foreign companies were to come into Iraq, that they help us," Awad said. "Not to suck the blood of the Iraqi people."
The unions were kept in the dark, as were most members of Iraq's parliament, until the draft law was leaked to the media. Even then it was still out the reach of most of Iraq's citizens.

"The discussion over the oil law was held very tightly between the Bush administration and key representatives of the most influential parts of Iraq's decision making authority," said Antonia Juhasz, an analyst with Oil Change International and author of "The Bush Agenda: Invading the World, One Economy at a Time."

"They are one of the only groups of concerned citizens in Iraq who's had real access to information about the oil law," Juhasz said of the IFOU. "They're able to represent opposition in a way that just isn't possible for a vast majority, almost of all of regular Iraqis."

Oil unions led large strikes in the 1940s and 1950s. In the past four years, Iraqi oil workers stopped work when they weren't being paid or when a foreign subcontractor was hired to replace them. They only threatened to strike after the Coalition Provisional Authority ordered wages decreased. The Iraq Oil Ministry balked. This prompted other unions, like dock workers in Umm Qasr and Zubair, to edge out foreign corporations given contracts.

The IFOU could shut down Iraq's production if the draft hydrocarbons law stands. With oil revenue funding 93 percent of the federal budget, that's a large bargaining chip.

Oil workers could also whip up a critical mass of dissent in their communities.

"For the time being, people are busy with their day-to-day lives and security," said Mohamed Zine, regional manger of Middle East at the global energy analyst IHS. "I think it's easy in Iraq if you say that foreign companies are stealing Iraqi oil, this message is easy to spread."
The oil workers' popular support crosses sectarian lines.

Greg Muttitt of the London-based social and environmental justice group Platform said sectarian conflict seen in Baghdad politics and violence throughout the country was absent from a December meeting of unionists in Amman, Jordan.

"There were Kurds, Sunni Arabs and Shiite Arabs present. The central versus regional issue barely came up," Muttitt said. "Yet all agreed in their strong opposition to privatization and production sharing.

"The central versus regional discussion has been most prominent because the debate so far has only taken place between the political elites, which are sectarianized," he said. "I don't think that's at all representative of how ordinary Iraqis think."

Awad points to the aftermath of the invasion, when production dropped to nearly nothing and the oil workers went right back to their black gold trenches.

"Sectarian strife was never an issue that the workers knew, or know in the current situation," Awad said. "They work. They produce. They don't pay attention to violence or sectarianism."
--
(Hiba Dawood in New York and Adil Matloob in London contributed to this story.)

Hands Off Iraqi Oil Teach In - Review

The HOIO Teach In last weekend (March 24th) was a success. Dozens of individuals and group representatives pledged to take action through their trade union branches, anti war networks and communities.

Review of teach-in organised by Hands off Iraqi Oil Coalition

By Tahrir Swift, Arab Media Watch adviser and exile from Saddam Hussein's regime

29 March 2007

Dozens of people took part in a teach-in organised by the Hands off Iraqi Oil Coalition on the 24 March 2007 in Union Chapel, London.

A press release the previous month launched a coalition of organisations (*) to campaign against the introduction of an oil law which was approved by the Iraqi Council of Ministers on 26 February 2007 and is currently in front of parliament. The law will basically facilitate the daytime robbery of Iraqi oil, as the speakers at this event stated.

"The Iraqi oil law is the world's best kept secret," said Greg Muttitt of PLATFORM, an activist and expert speaker on the proposed law. Until January this year, the transcript of the law, put together by parties close to the big oil companies, has been kept under wraps. It was only disclosed recently to Iraqi MPs, who are expected to vote on it this spring.

In the book A Game as Old as Empire, Muttitt explained in his chapter on The Hijack of Iraqi Oil Reserves that the sort of contracts this law seeks to introduce, commonly known as Production Sharing Agreements, have been resisted by the Gulf states, including Kuwait and Saudi Arabia:

"Iraq, with 10% of the world's oil reserves, seems to be the easiest to turn around. And if Iraq can be re opened to the multinationals, perhaps its neighbours could be pressured to follow suit."

The term PSA was dropped from the final draft of the text of the oil law. This is because of the bad name it got due to the excellent campaign by PLATFORM in exposing the fallacy of fairness implied in the term.
Anti-war and anti-globalisation activists spoke one after the other to condemn the "corporate invasion of Iraq," and cited it as the real motive behind the invasion and occupation.

Becca Fisher of Corporate Watch spoke of the early involvement of experts close to the oil majors, employed as consultants during the first year of occupation under Paul Bremmer in order to do the ground work and establish a way in for them to get their hands on Iraqi oil. "The British government directly and indirectly facilitated the work of lobbies, pushing the granting of companies like BP and Shell long-term contracts in Iraq," said Fisher.

Other activists also expressed their horror that Iraq, a country on its knees and under occupation, should be selected to offer such unfair contracts which will give the multinational companies full control of Iraq's massive oil reserves for 30 or more years to come.

According to Muttitt, the whole plan started in 2002 with the US State Department's 'The Future of Iraq Plan'. Iyad Allawi, then Iraqi interim prime minister, endorsed it in 2004 by producing the first policy promising the foreign oil companies the contracts for exploring and exploiting reserves in Iraq.

A gathering in February 2007 in Amman, Jordan, of 50 Iraqi oil technocrats and former senior civil servants in Iraq's Oil Ministry, issued a statement objecting to the rushing of such a controversial law while the country is in turmoil.

Apart from legalising the theft of Iraqi oil, the law gives a free hand to the Iraqi authorities to negotiate the contracts with the giant foreign oil companies without allowing parliament any say on a matter that will affect Iraqis for generations to come.

"History will not forgive those who play recklessly with the wealth and destiny of a people, and the curse of heaven and the fury of Iraqis will not leave them," warned Hasan Juma'a, president of the General Union of Oil Employees in Basra (GUOE), who has been at the forefront of the campaign of keeping Iraqi oil in the hands of Iraqis. "We believe this law to be more political than economic. It threatens to set governorate against governorate and region against region."

The ranks of the GUOE has more than doubled in recent months, after it opened its membership to all oil workers in Iraq, and because of the popularity of its principled stand on this sacred issue for all Iraqis.
It is thought that the proposed oil law will overturn law number 80, introduced in 1961 in Iraq, which nationalised the land not under the control of the multinational oil companies at the time. It will also overturn the 1972 nationalisation of oil law, introduced by the Baath party.

"Open the way to Iraqis to manage their own oil affairs," said Juma'a. "They are able to rise to the challenge. They have the experience in the field and the technical training. They have overcome hardships and proven to the world that they can provide the best service to Iraqis in the oil industry. The best proof of that is how after the entry of the occupying forces and the destruction of the infrastructure of the oil sector, the engineers, technical staff and workers were able to raise production from zero to 2,100,000 barrels per day without any foreign expertise or foreign capital."

The GUOE is not opposed to employing foreign companies to access technical assistance and modern technology to rehabilitate the oil industry. They do, however, object to allowing these companies a stake in the profit or long-term control of Iraq's wealth.

Many Iraqi technocrats have in the last several weeks written articles in Arabic arguing that the Iraqi oil industry can be modernised and developed without handing over "the property of the future Iraqi generations" to the multinational companies.

Iraqi oil revenues constitute 95% of national income, and are seen as the only hope for Iraq's recovery.

"All Iraqis have suffered from wars, 13 years of genocidal UN siege, and now a brutal occupation that ignores international law," said Malak Hamdan of Solidarity for an Independent and Unified Iraq. "70% of Iraqis are dependent on food rations, children's malnutrition is on the increase, the water and sewerage systems are in ruins, the health and education systems are barely functioning, our people's suffering is unimaginable. Oil revenues are the only hope for us and for the future generations. We simply cannot afford to allow their theft."

According to Fuad Qassim Al Ameer, an Iraqi oil expert, the plan by the occupiers and the multinational companies is to increase the extraction and consumption of Iraqi oil at a time when the whole world recognises climate change as the greatest threat facing humanity today. Ameer argues that such a hike in oil production is not in the interest of the Iraqi oil industry or economy.

He also cited the disastrous policy in Russia, where foreign investments in the oil sector were invited before tackling endemic corruption, costing the nation dearly and prompting a u-turn.

Muttitt also expressed his anxiety over the law's lack of watertight safeguards on pollution. If Shell's record in the Niger Delta is anything to go by, his fears are well-placed.

"Passing this law is the real 'mission' of Bush and Blair," said Hani Lazim of Iraqi Democrats Against the Occupation. " Iraq has for decades managed its own wealth and does not need this law. It is not in the interest of Iraq."
He also emphasised the importance of this solidarity campaign, especially while the US 'surge' and the new security plan provided cover for sneaking this law past the people of Iraq while they live under emergency law, unable to protest or make their voices heard.

Many Iraqis believe the law will amount to the surrendering of sovereignty over Iraq's wealth and hence the future of its economy. All objections to the proposed law have been explained on the Hands off Iraqi Oil website.
The activists at the event agreed to launch a national and international campaign to expose the law and it ramifications. Early Day Motion 1180 has been tabled by Katy Clark MP for members of the British parliament to sign. The EDM calls for allowing Iraqis to hold on to their oil, and demands that British government involvement in pushing this unjust law be made public.

(*) The coalition includes: PLATFORM, WAR ON WANT, Jubilee Iraq, NAFTANA, Voices in the Wilderness -UK , Corporate Watch and Iraq Occupation Focus

This article can be found at: http://www.arabmediawatch.com/amw/Articles/Analysis/tabid/75/newsid395/3779/Review-of-teach-in-organised-by-Hands-off-Iraqi-Oil-Coalition/Default.aspx