Final Version Of the HCL (Submitted to Parliament on February 15th 2007)

[darock0116]

Final version of Iraqi Hydrocarbon Law (http://www.iraqrevenuewatch.org/documents/oil_law_english_20070306.pdf) submitted to Parliament on February 15th, 2007, found at the Kurdistan Regional Government's website (http://www.krg.org/articles/article_detail.asp?LangNr=12<https://217.160.23.241/exchweb/bin/redir.asp?URL=http://www.krg.org/artices/article_detail.aspLangNr=12%26LNNr=28%26RNNr=70%26 ArticleNr=16644>&LNNr=28&RNNr=70&ArticleNr=16644).

http://www.iraqrevenuewatch.org/documents/oil_law_english_20070306.pdf

[darock0116]

OPEN LETTER -

Mr. President of House of Representatives,
Messrs. Members of House of Representatives.
Greetings,
A few days ago, the Cabinet approved a draft law on oil and gas and forwarded it to your Honorable Council for discussion aiming for its approval and legislation.
In this regard, we, Iraqi oil experts living outside and inside Iraq, would like to emphasize the need for a law that regulates the activity of the oil sector and ensure optimal investment of the oil wealth for the country. However, having examined the detailed draft law and discussed in a seminar devoted to this purpose in Amman on Feb.17th 2007, it was noted that there were many gaps and ambiguities that should be noteworthy and dealt with by your honorable Council aiming to precision of the law in a way that will lead to the success of application transparency and efficiency, so as to achieve the supreme national interest.
And in a time when we were wishing to acquaint the public and civil society organizations on the drafted law, in addition to oil cadres specialized in this field to study and enrich it before it is referred to your Honorable Council to discuss its legislation, we reiterate our view that there is a rush in its issuance in the light of current complex circumstances in which our dear country going through.
The symposium, which was held in Amman, yielded with a set of recommendations that can be summarized as follows:
(1) There is a noted rush in the passage of the law at the present time, and preferred to wait until the completion of the amendments to the Constitution under Article (142), and to be able to give more time to study and discuss it in a technical and professional manner. The absence of the Iraqi specialized vocations which had the honor of the takeoff in building the Iraqi oil industry known globally has been noticed, as well as the absence of the views of civil society organizations and trade unions in the discussion and enriching the draft law during the period of preparation.
(2) Corroboration of the orientation which was presented by the draft law regarding the need to restructure the Ministry of Oil and the re-establishment of Iraq National Oil Company, with consideration clarity of responsibilities and induplication.
and the independent consultants Agency should be avoided, to ensure the efficient functioning and transparency and professionalism especially with regard to the assertion by taking into account all the components of the Iraqi people because of its consolidation of the principle of quotas, as well as the way of selecting the members of the consultants Agency and their services' period.
4) The need to reconsider the exception of transformation and service sector of this law as preferred to merge it at the present time or to work on the legislation of a special law in parallel interest in issuing the current law of oil and gas.
(5) Review of the powers granted to the regional body in order to balance them with the federal powers and develop controls to ensure compliance with federal plan and the unity of resolution to block foreign companies competing to penetrate the national unity and shall be looked into this in the light of the forthcoming amendments to the Constitution.
(6) We detect that the motive for the issuance of such law was based on raising production capacity to solicit foreign investments, and in this aspect, we recommend to plan to raise the energy gradually starting with rehabilitation of existing production fields using national effort (Iraq National Oil Company), followed by the development of giant fields already discovered - undeveloped or that in partial production and scheduling their priorities as per their capacity and development costs, regardless of their geographical location through service and operational contracts with companies of efficiency and technical capability, as needed, and to avoid entering into long-term contracts with foreign companies at the present time.
(7) Continue to actively prospecting through national efforts, given the high rates of success and self-financing or through soft loans, especially for patches with high probabilities of success, and the limiting of contract licenses in their prospecting and development and production of areas that has low-lying prospects of success.
(8) Avoid long-term commitments with international companies in the contracts for prospecting and development and production prior providing secure and appropriate environment to ensure the execution of companies operations. And in all cases we recommend offering contracts with foreign companies to be viewed by your Honorable Council for ratification.
(9) As for the areas of finance, and in the light of the gradual ascent of the production rates for the whole of Iraq, it is proposed that the financing is essentially from the oil resources, and of foreign sources postponed pay by oil. As for the transformation and services sector could provide the required funds to enter into a partnership (Joint Venture) with local and foreign parties as a need.
At the end of our letter, we would like to reiterate our readiness to contribute to the maturing of this important law and the relevant laws and we are confident that your Honorable Council will deal with it in a patriotic sense entrusted you to give priority to the national interest over the political and factional considerations at this historic difficult juncture our country going through, and to slowdown in the issuance of the law until enriching it with the necessary required adjustments.
With deep appreciation

and respect


(3) Notes of clear imbalance in the composition of the Federal Council of the oil and gas

http://www.iraqrevenuewatch.org/documents/symposium_oil_experts.pdf

[Terri]

Darock ... I read yesterday that parilament meet but did not discuss the HCL, I just read that they meet today, yet they still did not dicsuss the HCL -- am I the only one that finds that strange. All the deadlines, the attention of the entire world, up-coming meetings, supposed high emphasis placed on the passing of this law - yet, for the last TWO sessions they haven't discussed it... I just simply do not believe it...either it's already passed, or they media simply are not reporting the truth/entire story...any feed back:

[darock0116]

Darock ... I read yesterday that parilament meet but did not discuss the HCL, I just read that they meet today, yet they still did not dicsuss the HCL -- am I the only one that finds that strange. All the deadlines, the attention of the entire world, up-coming meetings, supposed high emphasis placed on the passing of this law - yet, for the last TWO sessions they haven't discussed it... I just simply do not believe it...either it's already passed, or they media simply are not reporting the truth/entire story...any feed back:


Terri, I am glad you brought that up, my friend. IMO I think the HCL has been approved by parliament. They mention nothing about the HCL in parliament meetings, but we see articles about how the HCL is off to parliament next week and today their saying it might take till May 31 to be completed all SMOKE AND MIRRORS!!!!!:D

[darock0116]

Comments on Iraq’s Petroleum Laws

by Dr Fadhil J. Chalabi

The primary objective of a Petroleum Law for Iraq is to create favourable conditions for speeding up investments in the development of the country’s rich oil reserves, and for increasing as rapidly as possible the oil revenues necessary to salvage the country from its present economic ruin and poverty.
Oil policy should not be considered separately from economic issues but rather in relation to the country’s economic and social needs. It should also take into account the long-term trends in world energy and the future of oil in the world energy mix. Oil is Iraq’s only hope and it is crucial, therefore, that this asset be used rationally without the preconceived ideological and non-economic notions of the past, and be replaced by a pragmatic approach that focuses on a cost-benefit approach and emphasises a strict time-frame. In this respect, certain basic facts should steer policymakers towards achieving these objectives.
1) The former regime with its irrational, bellicose policies, and its furtive and self-defeating tactics vis-à-vis the UN inspectors, which unnecessarily prolonged sanctions for over 12 years, caused Iraq to lose a huge amount of oil exports. These losses can be measured by comparing Iraq’s actual production between 1980 and 2003 with its previous production of 14.5% of OPEC’s total production, had that production continued without the intervention of wars and UN sanctions. The difference between the two magnitudes represents losses of oil exports amounting to 18.6 billion barrels of oil (or 1.9mbpd), a colossal amount of almost twice the reserves of an OPEC member such as Algeria. Based on the average monthly price, the value of those oil export losses amount to a financial loss of $435 billion since 1980, or $44 million a day. These production losses have been to the advantage of OPEC countries, especially Saudi Arabia which in the absence of Iraqi oil has benefitted in being able to increase its quota system from 5.4mbpd to 8.4mbpd.
2



Given the dependence of Iraq’s economy on oil, such ruinous losses have broken the economic backbone of the country. In 1980 Iraq’s per capita income was almost equal to that of Greece, but since Iraq’s impoverishment this income is equivalent to a poor central African country, such as Burundi. This means that an oil policy for Iraq should aim to compensate for the enormous losses that have reduced Iraq to this level of poverty, i.e. a policy that would secure as well as speed up oil production and exports. Furthermore, Iraq needs a huge inflow of capital to rebuild the infrastructure with which to embark on projects and create jobs in a country where the number of unemployed now reaches as much as 50% of the labour force, and 70% of the country’s youth.
Iraq’s resource-base is so vast that, according to a CGES/Petrolog study, Iraq could produce at a high rate of 6-8mbpd until the end of the century before production shows signs of depletion. This means that speeding up production to that magnitude would have no effect on the life-span of oil reserves in Iraq.


2) The rate of growth of world demand for oil is on the decline, except in China and India which both constitute the only engines of oil-demand growth left. Demand has weakened with the huge improvements in the conservation of energy and increasing energy efficiency. This has been particularly obvious in the case of Western Europe and Japan, where the share of oil in total primary energy has been in sharp decline. In the US and even in China it has become of paramount importance to rationalize energy consumption in order to reducing the amount of oil necessary for achieving economic growth. This trend first began as a result of the 1970s price shocks. In the case of Western Europe the combined share of natural gas and nuclear power in total primary energy increased from 11% to 37.6%, obviously at the expense of oil’s share of total primary energy – with the Gulf’s oil exports suffering much more than Africa’s.
3

http://www.iraqrevenuewatch.org/documents/chalabi_20070306.pdf

[eatrocks]

Terri, I am glad you brought that up, my friend. IMO I think the HCL has been approved by parliament. They mention nothing about the HCL in parliament meetings, but we see articles about how the HCL is off to parliament next week and today their saying it might take till May 31 to be completed all SMOKE AND MIRRORS!!!!!:D


yea, how many articles came out with august, july dates for HCL ratification???

i think the Dubai meet cleared up issues, i think it will pass this week after articles of negativety

[Baja]

yea, how many articles came out with august, july dates for HCL ratification???

i think the Dubai meet cleared up issues, i think it will pass this week after articles of negativety

Tell ya' what...IF this thing IS indeed already done and we're hearing all this "Unconstitutional" crap coming out...The Kurds aren't signing off on it and the like...

This is called BS and REVERSE SPECULATION...They're flat out purposely lying to make it sound like it isn't done...

IF this is the case...BIG RV coming next week...

[rykpa]

It does seem very odd that there is no fanfare to go with this.

I would think that Mr. Bush would have his Press Secretary stand in for Tony Snow, lauding the progress of Iraq. I would expect this especially in the face of the treasonous behavior of Harry Reid and his ilk (Libidiots).

[nile]

as i said earlier today. they are leaving it abit close for comfort. lol

i said it was done about a month and a half ago. i then put it out of my mind tha it was done then. maybe it was...