Iraq's parliament debates ammended oil law

[Cyberkhan]

Iraq, 06 July 2007 (AME Info FZ LLC)

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An amended draft oil law has been submitted to Iraq's parliament where the real haggling will now begin over the country's most pressing economic and political issue.
Kurdistan is said to have been pledged 17 per cent of all oil revenues. However, the bill's key components have not been revealed. Continued opposition from both Sunni and Shiite political groups, as well as by those employed in the oil sector, could yet derail the bill.
Foreign fears
Iraq's Federation of Oil Unions, a group representing 26,000 workers in the sector, fears that foreign oil companies will gain too much access and even gain
control of the country's mineral resources.
Meanwhile, Kurdistan's regional authority has entered into a number of quasi-sovereign contracts with foreign oil companies to exploit discoveries in northern Iraq. These, it has declared, will be honoured in spite of an earlier declaration by Iraq's Oil Minister Hussein Al Shahristani that contracts signed before the new oil law is promulgated will be void.
It is a potentially explosive issue concerning control of revenues and also the fate of the northern oilfields and the region's main city, Kirkuk, home to Arabs, Turks as well as the majority Kurdish population.
Initial proposals envisaged a state-owned Iraq National Oil Company to manage new projects while an oil and gas council, possibly including non-Iraqi advisors, would regulate the industry.
The original outline stated that a newly constituted state oil company would have control of all the country's oilfields. Appendices to the first draft also granted INOC authority over 90 per cent of Iraq's crude reserves including those in Kurdistan.
The Oil Ministry admits different views on the role of the state-owned oil company, its relation with the ministry, as well as on existing and potential oilfields. The main amendment concerns the way in which revenues will be shared among Iraq's 18 regions.
Production sharing agreements
Government spokesman Ali Al Dabbagh says that the proposed legislation addresses the controversial question of production sharing agreements on a 'case-by-case basis'.
Such agreements involve large scale capital investment being underwritten by companies in specific projects which recoup costs when production starts and they subsequently divide revenues with the government. The essentially long-term nature of such deals allows an investing company to book the field's entire reservoir into its reserve portfolio.
Once a new law is passed, Oil Minister Hussein Al Shahristani says that 15 onshore oil and gas concessions will be auctioned with further licensing rounds following at six month intervals. But major international oil companies will want to assess data very closely with some estimates now questioning the true extent of the country's oil potential. Rebuilding Iraq's oil industry could take decades.
Iraq's oil production has plummeted from a peak of 3.7 million barrels per day to 1.8 million bpd in spite of a $1.7bn rehabilitation programme overseen by the US Army Corps of Engineers.
However, the true production figure is difficult to assess because of illicit trafficking and a lack of metering of oil passing through pipelines and into tankers. Up to 300,000 bpd is unaccounted for.

[taro patch]

"The essentially long-term nature of such deals allows an investing company to book the field's entire reservoir into its reserve portfolio."

I like the sound of this. It goes to show that oil reserves can be booked as assets, as in backing one's currency.

[dinar shore]

"The essentially long-term nature of such deals allows an investing company to book the field's entire reservoir into its reserve portfolio."

I like the sound of this. It goes to show that oil reserves can be booked as assets, as in backing one's currency.

Yeah, me too, assuming these greedy imbeciles could learn to compromise.

[Kim]

It doesn't sound to me like they are any closer to passing the HCL.

[Wolverine]

It doesn't sound to me like they are any closer to passing the HCL.

imo ~ this is a BRILLIANT OBSERVATION !!!

[hammerhead]

Always uniting...NEVER united!!! Anyone that spent the latter seventies and early eighties in the Middle East will remember our assessment of life over there!!!

[twodogs]

Looks like there is some political maneuvering going on with all the changes in parliamentary blocks. The United Iraqi Alliance, the largest block in Parliament has enough votes to pass the thing but they are trying to get all parties involved ........with something this important.

(Voice of Iraq) - 06-07-2007
Coalition : We can achieve the majority to pass the law with oil

Coalition : We can achieve the majority to pass the law with the absence of oil and compatibility Sadrien PNA-said the member of the House from the United Iraqi Alliance bloc. princess Albldaoui the reasons behind the postponement of the law of oil due to the importance and necessity of the participation of all parliamentary blocs in the discussion.


"."We can achieve a quorum so absences have achieved that in the first time, and compatibility Sadrion was not present
She Albldaoui to change or amend the oil must be under the dome of the House and not through media statements.
.Albldaoui unlikely to affect the absence of some of the political blocs on the House hearings on the possibility of passing the oil. .She noted that the coalition is capable of achieving a quorum sufficient to pass the law through Rallying House, as has happened in previous cases, as saying.