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  • Iraq to open oil up to foreign contractors

    Some other firms included but not mentioned in this article are BP, Maersk,Repsol, Statoil, BHP, Total, CNOOC, Sinopec, Lukoil and others for a total of 32.

    http://www.telegraph.co.uk/money/mai.../cniraq115.xml

    RSS| Britain's No.1 quality newspaper website | Make us your homepageWednesday 16 April 2008





    Iraq opens door to foreign contracts at major oil fields
    By Damien McElroy, Foreign Affairs Correspondent
    Last Updated: 2:23am BST 15/04/2008

    Foreign oil companies are poised to enter Iraq later this month after Baghdad signalled it was prepared to sign five oil field services agreements covering its biggest fields.
    More from energy and mining industries


    Iraq can reach a geologic potential of 10m barrels a day with substantial foreign investment. But output will depend on security improvements

    Five years since the US and Britain toppled Saddam Hussein's dictatorship, there have been few forays by oil's major players into Iraq, even though the country accounts for almost 10pc of world reserves.

    A violent insurgency forced most oil companies to keep executives responsible for Iraq outside the country. Most are based in the Gulf.

    Despite lack of foreign involvement in oil production, Iraq has returned to pre-war export levels of 2.5m barrels a day.

    The two-year service contracts that have been negotiated would see British, American and Australian oil companies supply equipment and expertise that would boost output by hundreds of thousands of barrels at each field.

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    "I expect the oil companies will get their first deals in Iraq before the end of the month," said a British official. "The Iraqi government has said it's ready to do the deal. For the big oil companies it's not so much security that's the stumbling block now, it's the legal framework. This is the development that starts the ball rolling."

    The five deals will cover Kirkuk, Missan, West Qurna, Zubair and Rumaila oil fields and have a face value of £1.5bn, though reimbursement will be satisfied in barrels.

    "In this politically sensitive and difficult situation, service contracts are a pragmatic step forward for Iraq," said Steve Peacock, head of exploration and production for BP in the Middle East.

    BP's contract, which is substantially negotiated, would involve the British firm providing project management, technical services and parts supplies to the North and South Rumaila fields.

    The measures are described as a stopgap until Iraq's parliament ratifies a long-delayed oil law to allow foreign firms an exploration and production role in Iraq for the first time since the industry was nationalised in the 1970s.

    While the security situation has prevented the large oil companies establishing a presence in Iraq, Mr Peacock said there had been extensive mapping of its resources. "We've studied the whole of the rest of the country, so we're waiting for what comes next after the service agreements.

    "We have an opinion on which bits we'd be more interested in. Whether it gets linked into the contract or not - it's a natural question that's on the table," added Mr Peacock. "These contracts are valid for a couple of years; how does that link with what comes next?"

    Royal Dutch Shell is set to emerge with interests in Kirkuk, Iraq's biggest field, discovered in 1927, and Missan, which it will serve in joint venture with the Australian miner BHP. The remaining contracts will go to Chevron, Exxon Mobil and Total.

    Oil experts estimate that Iraq can reach a geologic potential of 10m barrels a day with substantial foreign investment. But its achieved output is likely to rest on security improvements and nationalist resistance to foreign involvement.
    Greg

  • #2
    Re: Iraq to open oil up to foreign contractors

    Biscayne -

    This needs to be observed formally, for the record:

    How much endless yammering have we been reading over the past two or three years (some of it echoed or implied among iTulip contributors even!) that Iraq's petroleum reserves were "obviously" the captive sole resource of American big oil to be secured by "Mafioso American occupying forces?

    Hmm. Doesn't this news now confirm this oil bidding session is manifestly open to oil majors from all over the world?? Do we now notice any of the armies of proponents of the "USA as blatant Oil Vampire" attempting to eat their hats on this call? No. When it emerges that the Iraqi oil industry is apparently free to offer an open-bid process to oil companies worldwide , from the US, to the EU, to Russia, to China! - this must by definition be an open bid process no? - Where are all these shrill critics now? They are nowhere to be heard.

    This is the bunk about the "America has Iraqi oil all sewn up in a bag" which was attributed to "Cheney's evil schemes as former head of Halliburton" etc. etc. - propounded incessantly for the past four years, like the din of banging pots and pans. I am emphatically no fan of Dick Cheney, but that ideo-hysteria had me breaking out in hives.

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    • #3
      Re: Iraq to open oil up to foreign contractors

      They get a load of cash from them in "Advanced" payments....only to discover that the Locals will NOT honour ANY DEAL after America bales!
      Mike

      Comment


      • #4
        Re: Iraq to open oil up to foreign contractors

        Originally posted by Lukester View Post
        Biscayne -

        This needs to be observed formally, for the record:

        How much endless yammering have we been reading over the past two or three years (some of it echoed or implied among iTulip contributors even!) that Iraq's petroleum reserves were "obviously" the captive sole resource of American big oil to be secured by "Mafioso American occupying forces?

        Hmm. Doesn't this news now confirm this oil bidding session is manifestly open to oil majors from all over the world?? Do we now notice any of the armies of proponents of the "USA as blatant Oil Vampire" attempting to eat their hats on this call? No. When it emerges that the Iraqi oil industry is apparently free to offer an open-bid process to oil companies worldwide , from the US, to the EU, to Russia, to China! - this must by definition be an open bid process no? - Where are all these shrill critics now? They are nowhere to be heard.

        This is the bunk about the "America has Iraqi oil all sewn up in a bag" which was attributed to "Cheney's evil schemes as former head of Halliburton" etc. etc. - propounded incessantly for the past four years, like the din of banging pots and pans. I am emphatically no fan of Dick Cheney, but that ideo-hysteria had me breaking out in hives.
        It's not about ownership of the oil: The US needs a fresh creditor. The idea was for Iraq to buy US debt. Who cares about the oil so long as they're financing american overconsumption.

        Comment


        • #5
          Re: Iraq to open oil up to foreign contractors

          Will American taxpayers be re-imbursed for all the costs they incurred up to this point, in attempting to bring enough "stability" to Iraq, so that the world's major oil companies can produce there?

          It appears from this news bulletin that American taxpayers are the big losers in this.

          Comment


          • #6
            Re: Iraq to open oil up to foreign contractors

            Originally posted by phirang View Post
            It's not about ownership of the oil: The US needs a fresh creditor. The idea was for Iraq to buy US debt. Who cares about the oil so long as they're financing american overconsumption.
            You gotta be kidding. "It's not about ownership of the oil"? To my view it's indeed ALL about ownership or access to the oil. Why the hell not? Look forward, or look sideways at all these countries scrambling for access to it. Huh? No-one interested in that 'ownership thingy'?

            Your interpretation is maybe a little 'too sophisticated to be right' in my view.

            Respectfully.

            Comment


            • #7
              Re: Iraq to open oil up to foreign contractors

              Originally posted by World Traveler View Post
              Will American taxpayers be re-imbursed .. It appears from this news bulletin that American taxpayers are the big losers in this.
              Yes of course - US taxpayers are indeed the big losers. No argument on that.

              Comment


              • #8
                Re: Iraq to open oil up to foreign contractors

                Originally posted by BiscayneSunrise View Post
                ... other firms not mentioned in this article are BP, Maersk,Repsol, Statoil, BHP, Total, CNOOC, Sinopec, Lukoil and others for a total of 32. ... Foreign oil companies poised to enter Iraq later this month after Baghdad signalled it was prepared to sign five oil field services agreements covering its biggest fields.
                Originally posted by FRED View Post
                The Bush administration could not care less about Muslins. Anyone can see the US interest in the middle east has been since the turn of the century will always be about oil.
                Maybe Fred might qualify this fashionable cyncism somewhat, given the Iraqi government is apparently opening the bidding on oil contracts to Lukoil, CNOOC, Sinopec and a total of 32 oil majors scattered worldwide? Eh - that sure seems a wacky way for the Bush administration to "secure it's oil interests" after all this toil and strife! [ And still not a peep from the feverish proponents of "vampirical American oil interests" who have been preaching themselves hoarse on this issue for the past four years? :rolleyes:

                Comment


                • #9
                  Re: Iraq to open oil up to foreign contractors

                  Originally posted by Lukester View Post
                  Maybe Fred might qualify this fashionable cyncism somewhat, given the Iraqi government is apparently opening the bidding on oil contracts to Lukoil, CNOOC, Sinopec and a total of 32 oil majors scattered worldwide? Eh - that sure seems a wacky way for the Bush administration to "secure it's oil interests" after all this toil and strife! [ And still not a peep from the feverish proponents of "vampirical American oil interests" who have been preaching themselves hoarse on this issue for the past four years? :rolleyes:
                  The idea about "vampirical American oil interests" is just as ridiculous as "bringing democracy to the Middle East". When I hear people propagating this nonsense, I usually ask them 2 questions:

                  Q1. What is the US doing in Europe? It has no oil whatsoever, and does not need us (US) to bring them any more democracy, than they already have.
                  Q2. What is Carter Doctrine?

                  As a rule, they can hardly answer Q1 and absolutely cannot answer Q2.

                  I seriously doubt, US will ever bail out of the Middle East, Iraq or no Iraq. If it does, I would recommend to be consistent and leave Europe too. In this case I want to give Europeans a good advice (similar to an old Soviet joke) about some planning for their future.

                  Optimists among them should learn Chinese, pessimists should learn Russian and realists should learn AK47.
                  Last edited by medved; April 16, 2008, 06:20 PM. Reason: typo
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                  • #10
                    Re: Iraq to open oil up to foreign contractors

                    The answer is no, American taxpayers will not be reimbursed for the war in Iraq, just as they were not reimbursed for the Cold War or the two previous world wars.
                    Greg

                    Comment


                    • #11
                      Re: Iraq to open oil up to foreign contractors

                      That's funny phirang. Did you just dream that one up or what? It's interesting to note that as people's various theories regarding US conspiracies get popped they then come up with some other equally outrageous theory to discredit the US. A constant series of putdowns that never get proven true.

                      Seriously, phirang, if the idea was for Iraq to buy US debt all along why didn't you share that theory with us before now?
                      Greg

                      Comment


                      • #12
                        Re: Iraq to open oil up to foreign contractors

                        Medved, Now that AK 47 remark really was funny!

                        Excellent point about the Carter Doctrine. I would say that George Bush is a modern day Woodrow Wilson. He wants the US to be the catalyst for nascent democracies, willing to commit troops, money and political capital, even to the point of the ruination of his reputation.

                        To Fred's point, the US is mostly interested in the Gulf region because of oil. But if it was ONLY about oil, then the US would be supporting whatever dictator happened to be in charge of the spigots and leave it at that.

                        No, there is something larger going on here and despite whatever Obama and Hillary may say otherwise, the US will remain a political and diplomatic presence in the Gulf , even well after the oil runs out.
                        Greg

                        Comment


                        • #13
                          Re: Iraq to open oil up to foreign contractors

                          Originally posted by BiscayneSunrise View Post
                          That's funny phirang. Did you just dream that one up or what? It's interesting to note that as people's various theories regarding US conspiracies get popped they then come up with some other equally outrageous theory to discredit the US. A constant series of putdowns that never get proven true.

                          Seriously, phirang, if the idea was for Iraq to buy US debt all along why didn't you share that theory with us before now?
                          Then discard my thesis: leaves more money for me.

                          Comment


                          • #14
                            Re: Iraq to open oil up to foreign contractors

                            Originally posted by Lukester View Post
                            Biscayne -

                            This needs to be observed formally, for the record:

                            How much endless yammering have we been reading over the past two or three years (some of it echoed or implied among iTulip contributors even!) that Iraq's petroleum reserves were "obviously" the captive sole resource of American big oil to be secured by "Mafioso American occupying forces?

                            Hmm. Doesn't this news now confirm this oil bidding session is manifestly open to oil majors from all over the world?? Do we now notice any of the armies of proponents of the "USA as blatant Oil Vampire" attempting to eat their hats on this call? No. When it emerges that the Iraqi oil industry is apparently free to offer an open-bid process to oil companies worldwide , from the US, to the EU, to Russia, to China! - this must by definition be an open bid process no? - Where are all these shrill critics now? They are nowhere to be heard.

                            This is the bunk about the "America has Iraqi oil all sewn up in a bag" which was attributed to "Cheney's evil schemes as former head of Halliburton" etc. etc. - propounded incessantly for the past four years, like the din of banging pots and pans. I am emphatically no fan of Dick Cheney, but that ideo-hysteria had me breaking out in hives.
                            You're right in your opinion of the Kossack opinion, but you must admit that the oil fields at the very least was a very good side benefit of the invasion for the U.S. and Brits. Heck, my dad's been over to Iraq for two tours and he still has no idea what the f*** this was all for. Like medved said, the sole reason wasn't "bringing democracy to the Middle East".

                            Comment


                            • #15
                              Re: Iraq to open oil up to foreign contractors

                              Originally posted by BiscayneSunrise View Post
                              Medved, Now that AK 47 remark really was funny!

                              Excellent point about the Carter Doctrine. I would say that George Bush is a modern day Woodrow Wilson. He wants the US to be the catalyst for nascent democracies, willing to commit troops, money and political capital, even to the point of the ruination of his reputation.
                              Not quite. He wants a stable Iraq accessible to western oil interests ala Saudi Arabia, whatever political structure it takes. I don't remember US ever objecting to a stable monarchy.

                              To Fred's point, the US is mostly interested in the Gulf region because of oil. But if it was ONLY about oil, then the US would be supporting whatever dictator happened to be in charge of the spigots and leave it at that.
                              Again, provided this dictator is stable and US-friendly, not just any dictator (e.g. Saddam or Hugo Chavez).

                              No, there is something larger going on here and despite whatever Obama and Hillary may say otherwise, the US will remain a political and diplomatic presence in the Gulf , even well after the oil runs out.
                              Bull's eye!

                              Last time I checked, Carter Doctrine considers military action a valid option, and it was not formulated by republicans.
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