Sunday, January 8, 2012

Western oil firms remain as US exits Iraq



The end of the US military occupation does not mean Iraqis have full control of their oil.

A GOOD PIECE

Dahr Jamail
Al-Jazeera

"...."Prior to the 2003 invasion and occupation of Iraq, US and other western oil companies were all but completely shut out of Iraq's oil market," oil industry analyst Antonia Juhasz told Al Jazeera. "But thanks to the invasion and occupation, the companies are now back inside Iraq and producing oil there for the first time since being forced out of the country in 1973."

Juhasz, author of the books The Tyranny of Oil and The Bush Agenda, said that while US and other western oil companies have not yet received all they had hoped the US-led invasion of Iraq would bring them, "They've certainly done quite well for themselves, landing production contracts for some of the world's largest remaining oil fields under some of the world's most lucrative terms."

Dr Abdulhay Yahya Zalloum, an international oil consultant and economist who has spent nearly 50 years in the oil business in the US, Europe, Asia and the Middle East, agrees that western oil companies have "obtained concessions in Iraq's major [oil] fields", despite "there being a lack of transparency and clarity of vision regarding the legal issues".

Dr Zalloum added that he believes western oil companies have successfully acquired the lions' share of Iraq's oil, "but they gave a little piece of the cake for China and some of the other countries and companies to keep them silent".....

Oil analyst Juhasz also agrees.

"The US and other western oil companies and their governments had been lobbying for passage of a new national law in Iraq, the Iraq Oil Law, which would move Iraq from a nationalised to a largely privatised oil market using Production Sharing Agreements (PSAs), a type of contract model used in just approximately 12 per cent of the world's oil market."

She explained that this agreement has been summarily rejected by most countries, including all of Iraq's neighbours, "because it provides far more benefits to the foreign corporation than to the domestic government"....

"The public is against privatisation, which is one reason why the law has not passed," added Juhasz. "The contracts are enacting a form of privatisation without public discourse and essentially at the butt of a gun - these contracts have all been awarded during a foreign military occupation with the largest contracts going to companies from the foreign occupiers' countries. It seems that democracy and equity are the two largest losers in this oil battle.".

Iraq's oil future

Under the current circumstances, the possibility of a withdrawal of western oil companies from Iraq appears remote, and the Obama administration continues to pressure Baghdad to pass the Iraq Oil Law.
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