News Release

Iraq Oil Law: Mission Accomplished?

AP is reporting: “The Iraqi Cabinet has approved a draft law to manage the country’s vast oil industry and distribute its wealth among the population. Parliament will take up the measure when it reconvenes early next month after a recess.

“With all major parties endorsing the bill, approval is likely, although some politicians predicted a vigorous debate on some of the details.

“Many Iraqis fear the measure will effectively hand the country’s major natural resources over to foreign oil companies. Supporters maintain that oil giants have the billions … needed to upgrade the country’s decrepit wells, pipelines and port.”

KAMIL MAHDI
Author of a piece published in the U.K.’s Guardian headlined “Iraqis Will Never Accept This Sellout to the Oil Corporations,” Mahdi is an Iraqi academic and senior lecturer in Middle East economics at the University of Exeter.

He said today: “While the country has no functioning judicial system and no effective enforcement of laws to protect human life, the cabinet and parliament are busy passing a law that gives into the interests of major foreign corporations. This is the reality of the occupation.”
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EWA JASIEWICZ
Jasiewicz is a researcher at PLATFORM (a British human rights and environmental group that monitors the oil industry). She spent nine months in Iraq and worked extensively with the Iraqi oil workers union and organized the group Naftana – UK Support Committee for the Iraqi Federation of Oil Unions. She said today: “The Hydrocarbon Law reflects the process of readying Iraq’s oil for privatization. Drafted in secret, shaped by foreign powers, untransparent, undemocratic and forced through under military occupation. It can be regarded as the economic goal of the war and occupation … it will be viewed by most Iraqis as not just illegitimate, but a war crime.”
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RAED JARRAR
Jarrar is Iraq Project director for Global Exchange. He recently translated a draft of the Iraqi oil law and is in close contact with Iraqi parliamentarians. A translated copy of the draft is at his web page.

Jarrar said: “Financially, the proposed law legalizes very unfair types of contracts that may freeze Iraq into very long-term contracts that can go up to 35 years and cause the loss of hundreds of billions of dollars from Iraqis. … The law also gives regional authorities final say in dealing with the oil, instead of giving this final say to a central federal government. So it opens the door for splitting Iraq into three regions or possibly even three states in the near future.”
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ANTONIA JUHASZ
Juhasz is a Tarbell Fellow at Oil Change International and a visiting scholar at the Institute for Policy Studies. She and Jarrar co-wrote the recent piece “Oil Grab in Iraq,” which notes: “The exploration and production contracts give firms exclusive control of fields for up to 35 years including contracts that guarantee profits for 25 years. A foreign company, if hired, is not required to partner with an Iraqi company or reinvest any of its money in the Iraqi economy. It’s not obligated to hire Iraqi workers, train Iraqi workers, or transfer technology. …

“The law establishes a new Iraqi Federal Oil and Gas Council with ultimate decision-making authority over the types of contracts that will be employed. This Council will include, among others, ‘executive managers from important related petroleum companies.’ Thus, it is possible that foreign oil company executives could sit on the Council. It would be unprecedented for a sovereign country to have, for instance, an executive of ExxonMobil on the board of its key oil and gas decision-making body.”

Juhasz is author of the book The Bush Agenda: Invading the World, One Economy at a Time.
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For more information, contact at the Institute for Public Accuracy:
Sam Husseini, (202) 347-0020, (202) 421-6858; or David Zupan, (541) 484-9167