by Patrick Cockburn
Nearly four decades after the four biggest Western oil companies were
expelled from Iraq by Saddam Hussein, they are negotiating their return. By
the end of the month, Royal Dutch Shell, BP, Exxon Mobil and Total will sign
agreements with the Baghdad government, Iraq's first with big Western oil
firms since the US-led invasion in 2003.
The deals are for repair and technical support in some of the country's
largest oilfields, the Oil Ministry in Baghdad said yesterday. The return of
"Big Oil" will add to the suspicions of those in the Middle East who claimed
that the overthrow of Saddam was secretly driven by the West's desire to
gain control of Iraq's oil. It will also be greeted with dismay by many
Iraqis who fear losing control of their vast oil reserves.
Iraq's reserves are believed to be second only to Saudi Arabia in the Middle
East, but their exploitation has long been hampered by UN sanctions, imposed
on Iraq after Saddam Hussein invaded Kuwait in 1990. . . .
For the four oil giants, the new agreements will bring them back to a
country where they have a long history. BP, Exxon Mobil, Total and Shell
were co-owners of a British, American and French consortium that kept Iraq's
oil reserves in foreign control for more than 40 years.
The Iraq Petroleum Company (once the Turkish Petroleum Company) was formed
in 1912 by oil companies eager to grab the resources in parts of the Ottoman
Empire.
The company was formalised in 1928 and each of the four shareholders had a
23.75 per cent share of all the oil produced. The final 5 per cent went to
Calouste Gulbenkian, an Armenian businessman.
In 1931, an agreement was signed with Iraq, giving the company complete
control over the oi fields of Mosul in return for annual royalties. After
Saddam's coup in 1958, nationalisation came in 1972.
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Lutz Kleveman, "The New Great Game,"
Guardian, October 20, 2003
Patrick Cockburn, "Revealed: Secret Plan
to Keep Iraq Under U.S. Control," Independent, June 5, 2008
Cynthia Tucker, "Big Oil's slick no-bid contracts will keep us mired in
Iraq," Atlanta Journal-Constitution, June 22, 2008
Tom Engelhardt, "Media Tell Us About Iraq
War-Oil Connection Five Years After the Fact," Tomdispatch.com,
June 25, 2008
Bill Moyers and Michael Winship, "It Was Oil,
All Along," truthout.org, June 28, 2008
Andrew E. Kramer, "U.S.
Advised Iraqi Ministry on Oil Deals," New York Times, June 30, 2008
[And not only have companies like BP and Texaco been offered these no-bid
contracts, but what's strange about it is that they're service contracts,
and these are not oil service companies. So what's significant about these
contracts is that they appear to be giving these oil companies the right of
first refusal on future, more significant contracts. So, one week after
these smaller service agreements were announced, the Iraqi Oil Ministry
announced that they also will be handing out longer-term management
agreements, which will give oil companies the ability to manage existing
fields in Iraq and hold onto 75 percent of the worth of those contracts and
leave only 25 percent for Iraqis, which is absolutely unheard of in the
region, where 51 percent for the country is the baseline for new
exploration, for new fields. These are existing fields. They're already
working. The technology is already there. And these foreign companies are
going to be taking 75 percent of the worth of those existing fields in Iraq.
So it's daylight robbery. It's armed robbery--"Naomi Klein Reexamines 'The Shock Doctrine'," democracynow.org,
July 15, 2008]
[President Bush says the Iraq war is not about oil but his actions belie
that claim. In the months before the March 2003 invasion, members of the
U.S. State Department "Oil and Energy Working Group" met to plan how to open
Iraq to international oil companies. The oil law now proposed by the Iraqi
Council of Ministers is a virtual photocopy of a plan first drafted by U.S.
oil industry executives and consultants in Houston long before Iraq was
"liberated."
Giving credence to Iraqis' fears, the oil law presented to the Iraqi
Parliament, if enacted, would put effective control of most of Iraq's vast
oil resources into the hands of foreign companies. Despite great pressure
from the U.S. for its adoption, the law remains stalled in the Iraqi
Parliament because a majority clearly oppose it. Prior to the first Gulf war
and the sanctions that followed, IraqÕs oil, nationalized since 1975,
provided the foundation for a relatively good standard of living, producing
a high level of literacy, the largest number of engineers per capita in the
Arab world and a health care system considered the best in the region.
The proposed oil law creates a Federal Oil and Gas Council on which would
sit representatives of Exxon-Mobil, Shell, BP, etc., whose tasks include
approving their own contracts. . . .
One Iraqi oil company manager previously employed by Shell told her, "I see
the future of Iraq as the United Arab Emirates... separate states."
The draft oil law provides for "production sharing agreements," or long-term
contracts whereby foreign companies would control production, development
and sale of the oil for up to 30 years, and reap as much as 70% of the
profits. --Nancy Wohlforth and Fred Mason, "The Draft Iraqi Oil Law: Making a Mockery of
Sovereignty," Jurist, September 9, 2008]
