( – promoted by buhdydharma )
Have you ever wondered why…
… it has been the practice of the major media to avoid mentioning oil in connection with military activity in Iraq; something also common in the Congress, all following the lead of the Bush administration.
Shouldn’t we all be shocked then? Shouldn’t we be shocked to learn, after the US – British led invasion of Iraq to save the world from the dangers of Saddam’s non-existant WMDs, struck Iraq with a shock and awe which was to have become the centerpiece for a GWOT, that as Reuters reported on Tuesday:
Iraq opened its giant oilfields to foreign firms on Monday, putting British and U.S. companies in pole position five years after U.S.-led troops invaded the country to oust Saddam Hussein.
On June 30th it was revealed that a group of American advisers, led by a small State Department team, have been playing an integral part in drawing up technical service contracts between the Iraqi government and five major Western oil companies, two American, two British and one French – Exxon, Total, Shell, Chevron and BP, to develop some of the largest oil fields in Iraq.
The advisers – who, along with the diplomatic official, spoke on condition of anonymity – say that their involvement was only to help an understaffed Iraqi ministry with technical and legal details of the contracts and that they in no way helped choose which companies got the deals.
Technical service contracts are used by the other petroleum-rich countries in the Persian Gulf Region. In return for providing services such as consultation, training, and providing equipment for oil field development for an agreed upon period of time, they are paid a set fee for their services.
Readers might recall that the hydrocarbon law which had been set as a “benchmark” for determining progress in Iraq permitted, unlike other countries in the region, production sharing agreements which would allow foreign oil companies ownership of Iraq’s oil through PSAs (production sharing agreements) in return for their services. Such an oil law has not been approved by the Iraqi Parliament. However, Iraq is already splitting revenue by compromise between factions.
… the oil law has been stalled in Parliament by internal Iraqi disputes over the extent foreign oil companies should be allowed into the national oil sector and how much control over the oil strategy will be given to local governments. Three companion laws — revenue sharing, reconstituting the national oil company and reorganizing the Oil Ministry — are further behind in the legislative process.
It needs to be pointed out that the no-bid contracts that have been the object of most of the recent criticisms are relatively short-term, interim consulting contracts. However they provide a foot-in-the-door and these same companies will be on track for the next round of oil field development contracts. These are for work in oil fields which have been referred by the Iraq Oil Ministry as being the backbone of Iraq’s oil production.
These contracts, the next round, are estimated to be worth approximately $500 million each and would provide technology, training and equipment for six key oil fields in Iraq. The bidders, those noted above, were chosen out of a field of 120 companies. The bids are due to be reviewed in April of next year and contracts awarded based on how much the companies propose increasing production, how many jobs it will create for Iraqis and how much training the companies can provide for local staff.
Now, however, there has been a slight hitch in the negotiations for the smaller scale, interim technical services consulting contracts. The oil companies would prefer to have a share of Iraq’s oil rather than to receive payment in dollars. And with a falling dollar and rising oil prices, who wouldn’t.
Iraq said on Monday (29 June) that it had failed to sign technical support deals with global oil majors hoping to cash in on boosting the war-torn country’s extensive but under-exploited oilfields.
Iraq is still negotiating with Shell, BP, ExxonMobil, Chevron and Total, and a consortium of other smaller oil companies, to develop six oil blocks and two gas fields, Oil Minister Hussein al-Shahristani told a press briefing.
“We did not finalize any agreement with them because they refused to offer consultancy based on fees as they wanted a share of the oil,” he said.
“The TSAs (technical support agreements) are only simple consultancy contracts to help us raise the production during the interim period” before the ministry enters into long-term contracts to develop the oil and gas fields.
The widely expected arrangement was to pave the way for global energy giants to return to Iraq 36 years after Saddam Hussein threw them out, and was seen as a first step to access the earth’s third largest proven crude reserves.
Some US lawmakers are worried. They’re worried about perceptions.
Senators Schumer, Kerry and McCaskill in a short press conference Tuesday … warned against possible perceptions that the war was fought to benefit international oil companies …
Are they worried the truth might be revealed? Do they actually believe that the people of the Middle East or elsewhere have been fooled and really believe Iraq was invaded for altruistic reasons or for revenge against the 9/11 attack?
The semi-independent Kurdistan Region has already signed contracts with a number of oil companies including Hunt Oil Corp. which has connections with the Bush Administration. The Kurdistan contracts include production sharing agreements which allow for foreign oil companies’ ownership of Iraqi oil.
The Iraqi Oil Ministry has stated that the oil deals entered into by the Kurds are illegal and that the oil companies who have entered into them might well be barred from from participating in future contracting through the Ministry.
“We pretend it is not a centerpiece of our motivation, yet we keep confirming that it is,” Frederick D. Barton, senior adviser at the Center for Strategic and International Studies in Washington, said in a telephone interview. “And we undermine our own veracity by citing issues like sovereignty, when we have our hands right in the middle of it.” As quoted in NYT – 30 June 2008.
We’ve spent nearly a half a trillion dollars invading and occupying Iraq. Who can count the loss of lives and the toll in blood, in misery and destruction. But, as always when it comes to war, the well-connected stand to profit handsomely.