May 31st, 2007 - by admin
Joshua Holland /AlterNe – 2007-05-31 22:25:41
Bush’s Petro-Cartel Almost Has Iraq’s Oil
Joshua Holland /AlterNet
(May 30, 2007) — Iraq is sitting on a mother lode of some of the lightest, sweetest, most profitable crude oil on earth, and the rules that will determine who will control it and on what terms are about to be set.
The Iraqi government faces a December deadline, imposed by the world’s wealthiest countries, to complete its final oil law. Industry analysts expect that the result will be a radical departure from the laws governing the country’s oil-rich neighbors, giving foreign multinationals a much higher rate of return than with other major oil producers and locking in their control over what George Bush called Iraq’s “patrimony” for decades, regardless of what kind of policies future elected governments might want to pursue.
Iraq’s energy reserves are an incredibly rich prize. According to the U.S. Department of Energy, “Iraq contains 112 billion barrels of proven oil reserves, the second largest in the world (behind Saudi Arabia), along with roughly 220 billion barrels of probable and possible resources. Iraq’s true potential may be far greater than this, however, as the country is relatively unexplored due to years of war and sanctions.” For perspective, the Saudis have 260 billion barrels of proven reserves.
Iraqi oil is close to the surface and easy to extract, making it all the more profitable. James Paul, executive director of the Global Policy Forum, points out that oil companies “can produce a barrel of Iraqi oil for less than $1.50 and possibly as little as $1, including all exploration, oil field development and production costs.” Contrast that with other areas where oil is considered cheap to produce at $5 per barrel or the North Sea, where production costs are $12 to $16 per barrel.
And Iraq’s oil sector is largely undeveloped. Former Iraqi Oil Minister Issam Chalabi (no relation to the neocons’ favorite exile, Ahmed Chalabi) told the Associated Press that “Iraq has more oil fields that have been discovered, but not developed, than any other country in the world.” British-based analyst Mohammad Al-Gallani told the Canadian Press that of 526 prospective drilling sites, just 125 have been opened.
But the real gem — what one oil consultant called the “Holy Grail” of the industry — lies in Iraq’s vast western desert. It’s one of the last “virgin” fields on the planet, and it has the potential to catapult Iraq to No. 1 in the world in oil reserves. Sparsely populated, the western fields are less prone to sabotage than the country’s current centers of production in the north, near Kirkuk, and in the south near Basra. The Nation’s Aram Roston predicts Iraq’s western desert will yield “untold riches.”
Iraq also may have large natural gas deposits that so far remain virtually unexplored.
But even “untold riches” don’t tell the whole story. Depending on how Iraq’s petroleum law shakes out, the country’s enormous reserves could break the back of OPEC, a wet dream in Western capitals for three decades. James Paul predicted that “even before Iraq had reached its full production potential of 8 million barrels or more per day, the companies would gain huge leverage over the international oil system.
OPEC would be weakened by the withdrawal of one of its key producers from the OPEC quota system.” Depending on how things shape up in the next few months, Western oil companies could end up controlling the country’s output levels, or the government, heavily influenced by the United States, could even pull out of the cartel entirely.
Both independent analysts and officials within Iraq’s Oil Ministry anticipate that when all is said and done, the big winners in Iraq will be the Big Four — the American firms Exxon Mobile and Chevron, the British BP Amoco and Royal Dutch Shell — that dominate the world oil market. Ibrahim Mohammed, an industry consultant with close contacts in the Iraqi Oil Ministry, told the Associated Press that there’s a universal belief among ministry staff that the major U.S. companies will win the lion’s share of contracts. “The feeling is that the new government is going to be influenced by the United States,” he said.
During the 12-year sanction period, the Big Four were forced to sit on the sidelines while the government of Saddam Hussein cut deals with the Chinese, French, Russians and others (despite the sanctions, the United States ultimately received 37 percent of Iraq’s oil during that period, according to the independent committee that investigated the oil-for-food program, but almost all of it arrived through foreign firms).
In a 1999 speech, Dick Cheney, then CEO of the oil services company Halliburton, told a London audience that the Middle East was where the West would find the additional 50 million barrels of oil per day that he predicted it would need by 2010, but, he lamented, “while even though companies are anxious for greater access there, progress continues to be slow.”
Chafing at the idea that the Chinese and Russians might end up with what is arguably the world’s greatest energy prize, industry leaders lobbied hard for regime change throughout the 1990s. With the election of George W. Bush and Dick Cheney in 2000 — the first time in U.S. history that two veterans of the oil industry had ever occupied the nation’s top two jobs — they would finally get the “greater access” to the region’s oil wealth, which they had long lusted after.
If the US invasion of Iraq had occurred during the colonial era a hundred years earlier, the oil giants, backed by U.S. forces, would have simply seized Iraq’s oil fields. Much has changed since then in terms of international custom and law (when then-Deputy Secretary of Defense Paul Wolfowitz did in fact suggest seizing Iraq’s Southern oil fields in 2002, Colin Powell dismissed the idea as “lunacy”).
Understanding how Big Oil came to this point, poised to take effective control of the bulk of the country’s reserves while they remain, technically, in the hands of the Iraqi government — a government with all the trappings of sovereignty — is to grasp the sometimes intricate dance that is modern neocolonialism. The Iraq oil grab is a classic case study.
It’s clear that the U.S.-led invasion had little to do with national security or the events of Sept. 11. Former Treasury Secretary Paul O’Neill revealed that just 11 days after Bush’s inauguration in early 2001, regime change in Iraq was “Topic A” among the administration’s national security staff, and former Terrorism Tsar Richard Clarke told 60 Minutes that the day after the attacks in New York and Washington occurred, “[Secretary of Defense Donald] Rumsfeld was saying that we needed to bomb Iraq.” He added: “We all said … no, no. Al-Qaeda is in Afghanistan.”
On March 7, 2003, two weeks before the United States attacked Iraq, the United Nations’ chief weapons inspector, Hans Blix, told the U.N. Security Council that Saddam Hussein’s cooperation with the inspections protocol had improved to the point where it was “active or even proactive,” and that the inspectors would be able to certify that Iraq was free of prohibited weapons within a few months’ time.
That same day, IAEA head Mohammed ElBaradei reported that there was no evidence of a current nuclear program in Iraq and flatly refuted the administration’s claim that the infamous aluminum tubes cited by Colin Powell in making his case for war before the Security Council were part of a reconstituted nuclear program.
But serious planning for the war had begun in February of 2002, as Bob Woodward revealed in his book, “Plan of Attack.” Planning for the future of Iraq’s oil wealth had been under way for longer still.
In February of 2001, just weeks after Bush was sworn in, the same energy executives that had been lobbying for Saddam’s ouster gathered at the White House to participate in Dick Cheney’s now infamous Energy Task Force. Although Cheney would go all the way to the Supreme Court to keep what happened at those meetings a secret, we do know a few things, thanks to documents obtained by the conservative legal group JudicialWatch. As Mark Levine wrote in The Nation:
… a map of Iraq and an accompanying list of “Iraq oil foreign suitors” were the center of discussion. The map erased all features of the country save the location of its main oil deposits, divided into nine exploration blocks. The accompanying list of suitors revealed that dozens of companies from 30 countries — but not the United States — were either in discussions over or in direct negotiations for rights to some of the best remaining oil fields on earth.
Levine wrote, “It’s not hard to surmise how the participants in these meetings felt about this situation.”
According to the New Yorker, at the same time, a top-secret National Security Council memo directed NSC staff to “cooperate fully with the Energy Task Force as it considered melding two seemingly unrelated areas of policy.” The administration’s national security team was to join “the review of operational policies towards rogue states such as Iraq and actions regarding the capture of new and existing oil and gas fields.”
At the State Department, planning was also underway. Under the auspices of the “Future of Iraq Project,” an “Oil and Energy Working Group” was established. The full membership of the group — described by the Financial Times as “Iraqi oil experts, international consultants” and State Department staffers — remains classified, but among them, according to Antonia Juhasz’s “The Bush Agenda,” was Ibrahim Bahr al-Uloum, who would serve in Iyad Allawi’s cabinet during the period of the Iraqi Governing Council, and later as Iraq’s oil minister in 2005. The group concluded that Iraq’s oil “should be opened to international oil companies as quickly as possible after the war.”
But the execs from Big Oil didn’t just want access to Iraq’s oil; they wanted access on terms that would be inconceivable unless negotiated at the barrel of a gun. Specifically, they wanted an Iraqi government that would enter into production service agreements (PSAs) for the extraction of Iraq’s oil.
PSAs, developed in the 1960s, are a tool of today’s kinder, gentler neocolonialism; they allow countries to retain technical ownership over energy reserves but, in actuality, lock in multinationals’ control and extremely high profit margins — up to 13 times oil companies’ minimum target, according to an analysis by the British-based oil watchdog Platform (PDF).
As Greg Muttit, an analyst with the group, notes:
Such contracts are often used in countries with small or difficult oil fields, or where high-risk exploration is required. They are not generally used in countries like Iraq, where there are large fields which are already known and which are cheap to extract. For example, they are not used in Iran, Kuwait or Saudi Arabia, all of which maintain state control of oil.
In fact, Muttit adds, of the seven leading oil-producing countries, only Russia has entered into PSAs, and those were signed during its own economic “shock therapy” in the early 1990s. A number of Iraq’s oil-rich neighbors have constitutions that specifically prohibit foreign control over their energy reserves.
PSAs often have long terms — up to 40 years — and contain “stabilization clauses” that protect them from future legislative changes. As Muttit points out, future governments “could be constrained in their ability to pass new laws or policies.” That means, for example, that if a future elected Iraqi government “wanted to pass a human rights law, or wanted to introduce a minimum wage [and it] affected the company’s profits, either the law would not apply to the company’s operations or the government would have to compensate the company for any reduction in profits.” It’s Sovereignty Lite.
The deals are so onerous that they govern only 12 percent of the world’s oil reserves, according to the International Energy Agency. Nonetheless, PSAs would become the Future of Iraq Project’s recommendation for the fledgling Iraqi government. According to the Financial Times, “many in the group” fought for the contract structure; a Kurdish delegate told the FT, “everybody keeps coming back to PSAs.”
Of course, the plans for Iraq’s legal framework for oil have to be viewed in the context of the overall transformation of the Iraqi economy. Clearly, the idea was to pursue a radical corporatist agenda during the period of the Coalition Provisional Authority when the U.S. occupation forces were a de facto dictatorship.
And that’s just what happened; under L. Paul Bremer, the CPA head, corporate taxes were slashed, a flat tax on income was established, rules allowing multinationals to pull all of their profits from the country and a series of other provisions were enacted. These were then integrated into the Iraqi Constitution and remain in effect today.
Among the provisions in the Constitution, unlike those of most oil producers, is a requirement that the government “develop oil and gas wealth … relying on the most modern techniques of market principles and encouraging investment.” The provision mandates that foreign companies would receive a major stake in Iraq’s oil for the first time in the 30 years since the sector was nationalized in 1975.
Herbert Docena, a researcher with the NGO Focus on the Global South, wrote that an early draft of the constitution negotiated by Iraqis envisioned a “Scandinavian-style welfare system in the Arabian desert, with Iraq’s vast oil wealth to be spent upholding every Iraqi’s right to education, healthcare, housing and other social services.” “Social justice,” the draft declared, “is the basis of building society.”
What happened between that earlier draft and the constitution that Iraqis would eventually ratify? According to Docena:
While [U.S. Ambassador to Iraq Zalmay] Khalilzad and his team of U.S. and British diplomats were all over the scene, some members of Iraq’s constitutional committee were reduced to bystanders. One Shiite member grumbled, “We haven’t played much of a role in drafting the constitution. We feel that we have been neglected.” A Sunni negotiator concluded: “This constitution was cooked up in an American kitchen not an Iraqi one.”
With a constitution cooked up in D.C., the stage was set for foreign multinationals to assume effective control of as much as 87 percent of Iraq’s oil, according to projections by the Oil Ministry.
If PSAs become the law of the land — and there are other contractual arrangements that would allow private companies to invest in the sector without giving them the same degree of control or such usurious profits — the war-torn country stands to lose up to 194 billion vitally important dollars in revenue on just the first 12 fields developed, according to a conservative estimate by Platform (the estimate assumes oil at $40 per barrel; at this writing it stands at more than $59). That’s more than six times the country’s annual budget.
To complete the ripoff, the occupying coalition would have to crush Iraqi resistance, make sure it had friendly people in the right places in Iraq’s emerging elite and lock the new Iraqi government onto a path that would lead to the Big Four’s desired outcome.
Bush’s Petro-Cartel Almost Has Iraq’s Oil :Part Two
Joshua Holland / AlterNet
(May 31, 2007) — With 140,000 U.S. troops on the ground, the largest U.S. embassy in the world sequestered in Baghdad’s fortified “Green Zone” and an economy designed by a consulting firm in McLean, Va., post-invasion Iraq was well on its way to becoming a bonanza for foreign investors.
But Big Oil had its sights set on a specific arrangement — the lucrative production sharing agreements that lock in multinationals’ control for long terms and are virtually unheard of in countries as rich in easily accessible oil as Iraq.
The occupation authorities would have to steer an ostensibly sovereign government to the outcome they desired, and they’d have to overcome any resistance that they encountered from the fiercely independent and understandably wary Iraqis along the way. Finally, they’d have to make sure that the Anglo-American firms were well-positioned to win the lion’s share of the choicest contracts.
Dealing with the most likely points of opposition began almost immediately. While the Oil Ministry, famously, was one of the few structures the invading forces protected from looters in the first days of the war, the bureaucracy’s human assets weren’t so lucky. With a stroke of the pen, Coalition Provisional Authority boss L. Paul Bremer fired hundreds of ministry personnel, ostensibly as part of the program of “de-Baathification.”
But, as Antonia Juhasz, author of “The Bush Agenda,” told me, “it wasn’t an indication that they were a party to Saddam Hussein’s crimes … they were fired because they could have stood in the way of the economic transformation.” Some fraction were certainly hard-core Baathists, but they were all veterans of the country’s oil sector; they knew the industry, they knew what the norms in neighboring countries were and they had no loyalty to the occupation forces. Some had to go.
That was true at the top as well. Serving as oil minister in the Iraqi Interim Government was Thamir Ghadbhan, a British-trained technocrat who at one time had been chief of planning under Saddam Hussein and was widely respected for his political independence and his opposition to the previous regime (Saddam had ended up imprisoning him at Abu Ghraib).
But despite working closely with American advisors, Ghadbhan was replaced with Ibrahim Bahr al-Uloum, a close associate of Ahmed Chalabi, the exile favored by some war planners to run the country as a kindler and gentler — but no doubt just as corrupt — version of Saddam Hussein.
According to Greg Muttit, an analyst with the British oil watchdog Platform, Uloum at first seemed to be a malleable figure. He told the Financial Times that he personally favored PSAs and giving priority to U.S. oil companies “and European companies, probably.”
But Uloum would later publicly protest the elimination of fuel subsidies, a key provision of the country’s economic restructuring, saying, “This decision will not serve the benefit of the government and the people. This decision brings an extra burden on the shoulders of citizens.” He was, as the Associated Press reported, given “a forced vacation.”
It was, in the end, a permanent vacation; Chalabi, who was deputy prime minister at the time, took over the job himself (as “acting” minister for 30 days, but his term would last a year). Chalabi had no previous experience in the oil biz, but was a reliable, pro-Western figure with little in the way of nationalist zeal to get in the way of being a good lap dog. As leader of the Iraqi National Congress, he had said he favored the creation of a U.S.-led consortium to develop Iraq’s oil fields. “American companies will have a big shot at Iraqi oil,” Chalabi told the Washington Post in 2002.
According to Alexander Cockburn, Chalabi also orchestrated the ouster of Mohammed Jibouri, executive director of the state’s oil marketing agency, who had offended the Swiss giant Glencore by telling its executives that they couldn’t trade Iraqi oil after their extensive dealings with Saddam Hussein.
An emerging, although still fragile, civil society was another source of potential trouble. Iraqi trade unions were a thorn in the side of the CPA — shutting down the port of Khor az-Zubayr in protest of a rip-off deal with the Danish shipping giant Maersk, halting oil production in the south to demand the rehire of laid-off Iraqi workers and kicking Halliburton subsidiary Kellogg, Brown and Root out of their refineries.
Perhaps it’s not a coincidence, then, that the only significant law that Paul Bremer left on the books from the Hussein era was a prohibition against organizing public-sector workers. Raed Jarrar, an Iraqi analyst with the NGO Global Exchange, told me, “They’re having a lot of legal problems.”
Of course, none of that guaranteed that the Iraqis would stay on the preferred path, especially after the election of an ostensibly sovereign government.
And that’s where the most common — almost ubiquitous — tool of neocolonialism, debt, came into play. In this case, massive, crushing debt run up by a dictator who treated himself and his cronies to palaces and other luxuries, spent lavishly on weapons for Iraq’s war with Iran — fought in part on behalf of the United States — and owed Kuwait billions of dollars in reparations for the 1990 invasion.
To put Iraq’s foreign debt in perspective, if the country’s economy were the size of the United States’, then its obligations in 2004, proportionally, would have equaled around $55 trillion, according to IMF figures (and that doesn’t include reparations from the first Gulf War).
Clearly, that amount of debt was unsustainable, and the Bush administration launched a full-court press to get creditor nations to forgive at least part of the new government’s debt burden. Former Secretary of State James Baker, long the Bush family’s “fixer,” was dispatched on a tour of the world’s capitals to cut deals on behalf of the Iraqis.
The administration raised eyebrows in the NGO community when it adopted the language of debt-relief activists to frame their pitch. Bush, and Baker, called it “odious” debt, debt that financed the whims of a brutal dictator and used against the interests of the Iraqi population. Under international law, “odious” debt, in theory at least, doesn’t need to be forgiven; it’s written off as a dictator’s illicit gains. As one might expect, wealthy creditor nations have long resisted the concept.
Debt-relief activists Basav Sen and Hope Chu wrote that the move “seemed inexplicable at first.” But it soon became clear that Iraq’s debt-relief program was, in fact, a way of locking in Iraq’s economic transformation.
The largest chunk of debt, $120 billion, was owed to the Paris Club, a group of 19 industrialized nations. Baker negotiated a deal whereby the Paris Club would forgive 80 percent of Iraq’s debt, but the catch — and it was a big one — was that Iraq had to agree to an economic “reform” package administered by the International Monetary Fund, an institution dominated by the wealthiest countries and infamous across the developing world for its painful and unpopular Structural Adjustment Protocols.
The debt would be written off in stages; 30 percent would be cancelled outright, another 30 percent when an elected Iraqi government accepted an IMF structural reform agreement and a final 20 percent after the IMF had monitored its implementation for three years. This gave the IMF the role of watchdog over the country’s new economy, despite the fact that its share of the country’s debt burden was less than 1 percent of the total.
Among a number of provisions in the IMF agreement, along with privatizing state-run companies (which resulted in the layoffs of an estimated 145,000 Iraqis), slashing government pensions and phasing out the subsidies on food and fuel that many Iraqis depended on, was a commitment to develop Iraq’s oil in partnership with the private sector. Then-Finance Minister Adel Abdul Mehdi said, none too happily, that the deal would be “very promising to the American investors and to American enterprise, certainly to oil companies.”
The Iraqi National Assembly released a statement saying, “the Paris Club has no right to make decisions and impose IMF conditions on Iraq,” and called it “a new crime committed by the creditors who financed Saddam’s oppression.” And Zaid Al-Ali, an international lawyer who works with the NGO Jubilee Iraq, said it was “a perfect illustration of how the industrialized world has used debt as a tool to force developing nations to surrender sovereignty over their economies.”
The IMF agreement was announced in December of 2005, along with a new $685 million IMF loan that was to be used, in part, to increase Iraq’s oil output. The announcement came a month after Iraqis went to the polls to vote for their first government under the new Constitution in order, according to the Washington Post, to spare Iraqi “politicians from voters’ wrath.” That was a wise idea; immediately following the agreement, gas prices skyrocketed and Iraqis rioted.
The icing on the cake is that the deal James Baker negotiated with the Paris Club refers to Iraq as an “exceptional situation”; no precedent was set that would allow other highly indebted countries saddled with odious debt from their own past dictators to claim similar relief.
The deadline the Iraqi government must meet for the completion of its final oil law in December is a “benchmark” in the IMF agreement.
In an investigation for the Nation, Naomi Klein discovered that Baker had pursued his mission with an eye-popping conflict of interest. Klein discovered that a consortium that included the Carlyle Group, of which Baker is believed to have a $180 million stake, had contracted with Kuwait to make sure that the money it was owed by Iraq would be excluded from any debt-relief package. When Baker met with the Kuwaiti emir to beg forgiveness for Iraq’s odious debt, he had a direct interest in making sure he didn’t get it.
Another major creditor was Saudi Arabia. The Carlyle Group has extensive business dealings with the kingdom and Baker’s law firm, Baker Botts, was representing the monarchy in a suit brought by the families of the victims of 9/11.
The most recent IMF report (PDF) shows how successfully he failed: “While most Paris Club official creditors have now signed bilateral agreements, progress has been slow in resolving non-Paris Club official claims, especially those of Gulf countries,” it says.
It’s likely that Iraq, a country occupied for three years, devastated by 12 years of sanctions and with a per capita GDP of $3,400, will end up paying reparations to Kuwait, a country with a per capita GDP of over $19,000, for the five months Saddam occupied his neighbor in late 1990 and early 1991.
Iraq will still face a mountain of debt even if it meets all of the “benchmarks” required of it — the IMF expects the country’s debt service to equal five percent of its economic output in 2011 and warns that even a minor price shock in the oil market “would require significant borrowing from the international markets to close the financing gaps.”
“Sovereign” debt is transferable between governments; if a new strongman arises or Iraq becomes a loose federation, the debt will remain on the books and defaulting on it, while a possibility, has serious long-term consequences.
All of this is about bringing different forms of pressure onto Iraq’s nascent government, not controlling it, and it’s an important distinction. Before and since the “handover” to Iraq’s government, the Green Zone has been overrun with “advisers” from Big Oil. Aram Roston wrote, “It’s clear that there is not just the one Iraqi Oil Ministry, but a parallel ‘shadow’ ministry run by American advisers.” In business, that’s known as “positioning.”
Phillip Carroll, a former chief executive with Royal Dutch/Shell and a 15-member “board of advisors” were appointed to oversee Iraq’s oil industry during the transition period. According to the Guardian, the group “would represent Iraq at meetings of OPEC.” Carroll had been working with the Pentagon for months before the invasion — even while the administration was still insisting that it sought a peaceful resolution to the Iraq crisis — “developing contingency plans for Iraq’s oil sector in the event of war.”
According to the Houston Chronicle, “He assumed his work was completed, he said, until Defense Secretary Donald Rumsfeld called him shortly after the U.S.-led invasion began and offered him the oil adviser’s job.” Carroll, in addition to running Shell Oil in the United States, was a former CEO of the Fluor Corp., a well-connected oil services firm with extensive projects in Saudi Arabia and Kuwait, and at least $1.6 billion in contracts for Iraq’s reconstruction. He was joined by Gary Vogler, a former executive with ExxonMobile, in Iraq’s Office of Reconstruction and Humanitarian Assistance.
After spending six months in the post, Carroll was replaced by Robert E. McKee III, a former ConocoPhillips executive. According to the Houston Chronicle, “His selection as the Bush administration’s energy czar in Iraq” drew fire from congressional Democrats “because of his ties to the prime contractor in the Iraqi oil fields, Houston-based Halliburton Co. He’s the chairman of a venture partitioned by the … firm.”
The administration selected Chevron Vice President Norm Szydlowski to serve as a liaison between the Coalition Provisional Authority and the Iraqi Oil Ministry. Now the CEO of the appropriately named Colonial Pipeline Co., he continues to work with the Iraq Energy Roundtable, a project of the U.S. Trade and Development Agency, which recently sponsored a meeting to “bring together oil and gas sector leaders in the U.S. with key decision makers from the Iraq Ministry of Oil.”
Terry Adams and Bob Morgan of BP, and Mike Stinson of ConocoPhillips would also serve as advisors during the transition.
After the CPA handed over the reigns to Iraq’s interim government, the embassy’s “shadow” oil ministry continued to work closely with the Iraqis to shape future oil policy. Platform’s Greg Muttit wrote that “senior oil advisers — now based within the Iraq Reconstruction Management Office (IRMO) in the U.S. Embassy … included executives from ChevronTexaco and Unocal.”
After the handover, a senior U.S. official said: “We’re still here. We’ll be paying a lot of attention, and we’ll have a lot of influence. We’re going to have the world’s largest diplomatic mission with a significant amount of political weight.”
The majors have also engaged in good, old-fashioned lobbying. In 2004, Shell advertised for an Iraqi lobbyist with good contacts among Iraq’s emerging elites. The firm sought “a person of Iraqi extraction with strong family connections and an insight into the network of families of significance within Iraq.”
According to Platform, just weeks after the invasion, in a meeting with oil company execs and Australian Foreign Minister Alexander Downer in London, former British Foreign Secretary Sir Malcolm Rifkind promised to personally lobby Dick Cheney for contracts on behalf of several firms, including Shell.
Meanwhile, major oil firms were positioning themselves so that they’d have the best contacts in the new government. According to the Associated Press, “The world’s three biggest integrated oil companies” — BP, ExxonMobil and Royal Dutch/Shell — “struck cooperation or training deals with Iraq” in 2005.
“It’s a way to maintain contact and get the oil officials to know about them,” former Iraqi Oil Minister Issam Chalabi told the AP. And it seems to have worked; in May, Iraq’s current oil minister, Husayn al-Shahristani, said that one of his top priorities would be to finalize an oil law and sign contracts with “the largest companies.”
Washington has its hands all over the drafting of that law. Early on, in 2003, USAID commissioned BearingPoint, Inc. to submit recommendations for the development of Iraq’s oil sector. BearingPoint was the firm that designed the country’s economic transformation under a previous USAID contract, so it was no surprise that its report reinforced the preference for PSAs that “everybody [kept] kept coming back to” during meetings of the State Department’s “Future of Iraq Project.”
In February, just months after the Iraqis elected their first constitutional government, USAID sent a BearingPoint adviser to provide the Iraqi Oil Ministry “legal and regulatory advice in drafting the framework of petroleum and other energy-related legislation, including foreign investment.”
According to Muttit, the Iraqi Parliament had not yet seen a draft of the oil law as of July, but by that time it had already been reviewed and commented on by U.S. Energy Secretary Sam Bodman, who also “arranged for Dr. Al-Shahristani to meet with nine major oil companies — including Shell, BP, ExxonMobil, ChevronTexaco and ConocoPhillips — for them to comment on the draft.”
All of these points of pressure are only what we can see in the light of day. There is certainly much more occurring under the table. Raed Jarrar told me that he “was personally familiar with the kind of intimidation that can be brought by both the U.S. military and civilian” personnel, and that he would be shocked if “multiple millions of dollars in bribes” were not changing hands.
The IMF noted in its latest report (PDF) that “corruption related to the production and distribution of refined fuel products was rampant.” Last March, 450 Oil Ministry employees were fired for suspected corruption, and Mohammed al-Abudi, the Oil Ministry’s director general for rrilling, said that “administrative corruption” was pervasive. “The robberies and thefts are taking place on a daily basis on all levels,” he said, “committed by low-level government employees and by high officials in leadership positions of the Iraqi state.”
The same day that the U.N. legitimized the occupation, George Bush signed Executive Order 13303 providing full legal immunity to all oil companies doing business in Iraq in order to facilitate the country’s “orderly reconstruction.”
Yet, despite a five-year effort, Big Oil still sits on the sidelines, wary of the disorder and violence that’s plagued the country. Ironically, it appears that China may well receive the first deal in post-Saddam Iraq (although it’s one negotiated with Hussein’s government before the war).
The Kurdish autonomous zone has signed three PSAs — none with the majors — although there is some dispute about their validity (and, at this writing, there are reports that the Kurds are in negotiations with Royal Dutch/Shell and BP, among others).
At this point, the situation is very fluid. Last week, Iraqis were shocked when a controversial measure that might lead to the country’s effective breakup was passed by Parliament by one vote. The major Sunni parties and Muqtada al Sadr’s ministers boycotted the vote in outrage.
Muddying the waters further is a heated debate about whether a somewhat ambiguous provision in the Iraqi Constitution already gives provincial governments the right to hold on to oil revenues rather than send them to the central government. The results of all of these debates will have an enormous impact on Iraq’s chances to build an autonomous and potentially prosperous country down the road.
It’s possible that the administration and its partners badly overplayed their hand. Iraq’s new government stands on the verge of a complete meltdown, faced with a crisis of legitimacy based largely on the fact that it is seen as collaborating with American forces.
Overwhelming majorities of Iraqis of every sect believe the United States is an occupier, not a liberator, and is convinced that it intends to stay in Iraq permanently. “If you go in front of Parliament, Raed Jarrar told me, “and ask: ‘who is opposed to demanding a timetable for the Americans to withdrawal?’ nobody would dare raise their hand.” The passage of a sweetheart oil law could prove to be a tipping point. It’s also possible Iraq’s government won’t make it to December; at this writing, rumors of a “palace coup” are swirling around Baghdad, according to Iraqi lawmakers.
What is clear is that the future of Iraq ultimately hinges to a great degree on the outcome of a complex game of chess — only part of which is out in the open — that is playing out right now, and oil is at the center of it. It’s equally clear that there’s a yawning disconnect between Iraqis’ and Americans’ views of the situation. Erik Leaver, a senior analyst at the Institute for Policy Studies in Washington, told me that the disposition of Iraq’s oil wealth is “definitely causing problems on the ground,” but the entire topic is taboo in polite D.C. circles.
“Nobody in Washington wants to talk about it,” he said. “They don’t want to sound like freaks talking about blood for oil.” At the same time, a recent poll asked Iraqis what they believed was the main reason for the invasion and 76 percent gave “to control Iraqi oil” as their first choice.
Correction: an earlier version of this article identified BearingPoint, Inc. as a company spun off from Arthur Anderson Consulting. It is a spin-off from KPMG, LLC.
Joshua Holland is an AlterNet staff writer.
© 2007 Independent Media Institute. All rights reserved.
Posted in accordance with Title 17, US Code, for noncommercial, educational purpose.
May 31st, 2007 - by admin
Commentary by James Paul / Global Policy Forum – 2007-05-31 22:09:28
(July 14, 2006) — The governments of the Coalition that overthrew Saddam Hussein announced that they acted because of weapons of mass destruction, terrorist threats, and a desire to install democracy in Iraq. They insisted that their actions had nothing whatsoever to do with oil.
A confidential document has now come to light that helps us gain perspective on these official arguments. The document reveals that, in private, the Coalition governments were extremely interested in oil and that intense negotiations were going on, even while the initial fighting was still under way, to parcel out Iraq’s major oil fields. The main decisions were being taken in Washington. Key players — in the UK, Australia, France and elsewhere — saw Washington as the ultimate arbiter of Iraq’s oil resources.
The present document is a diplomatic cable which summarizes a private meeting, held in London in May 2003, just two months after the beginning of hostilities. It was a time when the participants were optimistic that the conflict would soon be over and that rapid progress would soon be made by the occupation authorities to consolidate their hold over the country.
The participants discuss a bid by BHP Billiton, Australia’s largest company, for Halfayah, one of Iraq’s largest undeveloped oil fields. The document, prepared by the Australian Department of Foreign Affairs, summarizes the meeting, held at Stoke Lodge, Australia’s diplomatic headquarters in the UK. The gathering brought together former UK Foreign Secretary Sir Malcolm Rifkind (serving in this case as a BHP lobbyist), Australian Foreign Affairs Minster Alexander Downer, Australia’s High Commissioner to the UK Michael L’Estrange (the equivalent of ambassador), and top managers from BHP Billiton (the world’s largest mining corporation).
Copies of these minutes (marked “Confidential”) were sent to the Australian Prime Minister, the Minister for Trade, and officials within the Australian Office of National Assessment – the intelligence services. The main subject of the meeting is described in the heading as “BHP Billiton Rights to Halfayah Oilfield Iraq.”
The document came to light through the work of an Australian Royal Commission, set up in November 2005. The Commission was charged with investigating possible illegal acts by Australian companies during the UN oil for food program. Headed by Terence Cole QC and generally known as the “Cole Inquiry,” the Commission has held extensive hearings and gathered a large cache of private documents which it has posted on its web site.
Since the time of the meeting, as Coalition forces have faced a powerful insurgency, the participants’ expectations of quick deals have proved illusory. Still, the document is extraordinarily valuable as a clue to what is happening at present. It provides indispensable and very precious evidence about how governments and companies have been thinking about the division of Iraqi oil in the post-war period. We see that oil companies and high political figures have been involved in intense secret negotiations, that participation in the Coalition was seen to be a key claim on future oil contracts, and that the United States government — not Iraqis — was seen to be the ultimate arbiter of Iraq’s oil resources.
The document is relatively short, but it is rich in implications and enticing in details. The text below provides comments on each numbered paragraph of the original text.
The opening sections cover matters that are relatively well-known. The company representatives point out that:
1. There are five “strategic” undeveloped oilfields in southern Iraq that are especially interesting to major oil companies because of their exceptionally large size. The Halfayah field, coveted by BHP Billiton, contains five billion barrels of recoverable oil, making it one of the world’s largest. Development of the field would cost, according to BHP, about $2 billion [at then current prices the oil would have been worth over $200 billion].
2. Iraq has extensive additional oil potential, with seventy percent of the country unexplored. Iraq also has extensive undeveloped gas deposits.
3. In the mid 1990s, there had been secret negotiations between a number of foreign companies and the government of Saddam Hussein. In 1996/97, BHP was ready to sign an agreement on Halfayah, while French, Russian and Italian companies were also ready with contracts for other key fields.
4. The contracts were not signed because of UN sanctions. BHP was also in conversations with the Iraqis about oil exploration in the Western desert.
Then the document begins to reveal unknown aspects of the matter:
5. In 2000, BHP had transferred any existing “rights” it had in the Halfayah field to a joint venture led by another company, Tigris Petroleum, incorporated in Gibraltar and headed by senior BHP executives who negotiated the original contract. [Those executives, though no longer active in BHP, had close ties to the company.] Tigris is described by BHP management at the meeting as “responsible for maintaining relationships with Iraq by working on oil for food related projects.”
[This is typical of the complex legal structure of oil deals and is probably not a major revelation. However, the ownership structure of Tigris and of the joint venture remains unknown, and we do know that Tigris was involved in kickbacks under the oil for food program. It is possible that some prominent Iraqis now have a financial interest in this mysterious company.]
6. BHP and Tigris had been “in discussions” with Shell, the Anglo-Dutch oil major, to bring Shell into the Halfayah development scheme. Shell was being offered a 40% share of the joint venture consortium, while BHP was to keep 40%. Shell was seen by BHP as bringing not only technical and financial benefit but also “political” support.
[Evidently Shell was seen to bring support from both the UK and the US governments. The choice of Shell as a partner is interesting, since Billiton, now part of BHP Billiton, was formerly a subsidiary of Shell, giving the two companies especially close working relations.]
7. BHP emphasizes that its previous oilfield studies at Halfayah, its plans for developing the field and its existing agreements with the Iraqis would allow a very fast startup for the project. BHP also emphasizes that the participation of Shell (said to be “another multinational from a Coalition country”) would lend to the political success of the venture.
8. Sir Malcolm urges BHP to “register” its interest with the “US administration,” noting that the United States “would seek to protect its commercial interest in Iraq” and reminding BHP that “existing consortia are being encouraged to take on US partners.” The claim “required lobbying — including from the Australian government — in Washington.”
Sir Malcolm said nothing about consulting with or persuading Iraqis about the BHP bid. But he did reveal that the French [who had led the opposition to the war in the Security Council] were already proposing to share the Iraqi fields they had formerly acquired through new negotiations with Chevron [the second largest US oil company].
9. Sir Malcolm had already been very active as a lobbyist. He had had conversations with the UK Foreign Office on May 19 about the BHP matter. BHP had also “briefed” the Australian Prime Minister’s office and other ministries. And there was a plan (presumably by Sir Malcolm) to lobby Downing Street (the office of the UK Prime Minister). The lobbying effort would also go to Washington “next week,” where “the consortium” would brief the Australian embassy and the State Department. Sir Malcolm would also meet with Vice President Cheney “when the opportunity arose.”
Another revelation at this point shows that BHP and its partner, Shell, are worried that US administrators in Iraq were not “aware” of their bid for Halfayah! So BHP is counting on Phil Carroll, a former Shell executive hired by the US as an advisor to the Iraqi Oil Ministry, to “influence Pentagon planners on the ground in Iraq of the consortium’s claims.”
The document also reveals that Washington had “told the UK ‘not to behave like the English’ but rather tell the [US] administration if it has particular interests.” This suggests that the senior partner is warning its ally not to act secretly and privately but to be open about UK oil aspirations and dealings. At the very least, this suggests that there are tensions between Washington and London over the postwar disposition of Iraqi oil.
10. At this point, the minutes refer to the comments of Mr. Downer, the Australian Foreign Minister, who warns that “the question of oilfields would be a sensitive one in Iraq,” because it “played into sensitivities over the war.”
Downer also insists that the Australian government “has said sincerely that it had not joined the Coalition forces on the basis of oil” and he says that it is “the Iraqis themselves who should be awarding the contracts.” [Downers comments are ironic, given the context of the secret meeting in London that he is attending, but we can assume that the comments are stated grandiosely for the record, since he soon agrees to do his part in the scheme.]
11. Downer goes on to agree that he will lobby for the company’s Halfayah interest, both in Washington and with US proconsul Paul Bremer in Baghdad. He does not refer further to the Iraqi interest, though he does say of BHP’s bid that he “would have it raised” (presumably by others) “with the Oil Ministry in Baghdad.”
At this point, the discussion about Iraq ends. The players have agreed to their lobbying strategy and assignments. After brief reference to other matters, the meeting adjourns.
The document suggests that many other discussions of the same type were being held then (and have been held since) – particularly in London and Washington, involving Exxon, Chevron, Shell, BP and other players. In fact, we specifically learn about negotiations between “the French” (presumably the company Total) and the US company Chevron. It would be extraordinarily interesting to see reports of those other meetings and to learn about what was decided and when.
The Iraqi insurgency has seriously set back the timetable of these companies and changed the political equation. The eventual outcome is more in doubt than the players in this document originally imagined. But it’s likely that the Coalition companies still expect to take over Iraq’s huge oilfields.
And Washington doubtless has already decided which company will get what. When Sir Malcolm said that Washington “would seek to protect its commercial interests in Iraq” he was speaking in a subtle code. But given the hundreds of billions of dollars in oil company profits at stake, he certainly was not exaggerating.
May 31st, 2007 - by admin
Cindy Sheehan & Ponderosa Pine – 2007-05-31 21:52:46
“Good Bye, America”
Cindy Sheehan / DailyKos.com
(May 28, 2007) — I have endured a lot of smear and hatred since Casey was killed and especially since I became the so-called “Face” of the American anti-war movement. Especially since I renounced any tie I have remaining with the Democratic Party, I have been further trashed on such “liberal blogs” as the Democratic Underground. Being called an “attention whore” and being told “good riddance” are some of the more milder rebukes.
I have come to some heartbreaking conclusions this Memorial Day Morning. These are not spur-of-the-moment reflections, but things I have been meditating on for about a year now. The conclusions that I have slowly and very reluctantly come to are very heartbreaking to me.
The first conclusion is that I was the darling of the so-called left as long as I limited my protests to George Bush and the Republican Party. Of course, I was slandered and libeled by the right as a “tool” of the Democratic Party. This label was to marginalize me and my message. How could a woman have an original thought, or be working outside of our “two-party” system?
However, when I started to hold the Democratic Party to the same standards that I held the Republican Party, support for my cause started to erode and the “left” started labeling me with the same slurs that the right used. I guess no one paid attention to me when I said that the issue of peace and people dying for no reason is not a matter of “right or left”, but “right and wrong.”
I am deemed a radical because I believe that partisan politics should be left to the wayside when hundreds of thousands of people are dying for a war based on lies that are supported by Democrats and Republicans alike. It amazes me that people who are sharp on the issues and can zero in like a laser beam on lies, misrepresentations, and political expediency when it comes to one party refuse to recognize it in their own party. Blind party loyalty is dangerous whatever side it occurs on.
People of the world look on us Americans as jokes because we allow our political leaders so much murderous latitude and if we don’t find alternatives to this corrupt “two” party system our Representative Republic will die and be replaced with what we are rapidly descending into with nary a check or balance: a fascist corporate wasteland. I
am demonized because I don’t see party affiliation or nationality when I look at a person, I see that person’s heart. If someone looks, dresses, acts, talks and votes like a Republican, then why do they deserve support just because he/she calls him/herself a Democrat?
I have also reached the conclusion that if I am doing what I am doing because I am an “attention whore”, then I really need to be committed. I have invested everything I have into trying to bring peace with justice to a country that wants neither. If an individual wants both, then normally he/she is not willing to do more than walk in a protest march or sit behind his/her computer criticizing others.
I have spent every available cent I got from the money a “grateful” country gave me when they killed my son and every penny that I have received in speaking or book fees since then. I have sacrificed a 29-year marriage and have traveled for extended periods of time away from Casey’s brother and sisters and my health has suffered and my hospital bills from last summer (when I almost died) are in collection because I have used all my energy trying to stop this country from slaughtering innocent human beings. I have been called every despicable name that small minds can think of and have had my life threatened many times.
The most devastating conclusion that I reached this morning, however, was that Casey did indeed die for nothing. His precious lifeblood drained out in a country far away from his family who loves him, killed by his own country which is beholden to and run by a war machine that even controls what we think. I have tried ever since he died to make his sacrifice meaningful.
Casey died for a country which cares more about who will be the next American Idol than how many people will be killed in the next few months while Democrats and Republicans play politics with human lives. It is so painful to me to know that I bought into this system for so many years and Casey paid the price for that allegiance. I failed my boy and that hurts the most.
I have also tried to work within a peace movement that often puts personal egos above peace and human life. This group won’t work with that group; he won’t attend an event if she is going to be there; and why does Cindy Sheehan get all the attention anyway? It is hard to work for peace when the very movement that is named after it has so many divisions.
Our brave young men and women in Iraq have been abandoned there indefinitely by their cowardly leaders who move them around like pawns on a chessboard of destruction and the people of Iraq have been doomed to death and fates worse than death by people worried more about elections than people.
However, in five, ten, or fifteen years, our troops will come limping home in another abject defeat and ten or twenty years from then, our children’s children will be seeing their loved ones die for no reason, because their grandparents also bought into this corrupt system. George Bush will never be impeached because if the Democrats dig too deeply, they may unearth a few skeletons in their own graves and the system will perpetuate itself in perpetuity.
I am going to take whatever I have left and go home. I am going to go home and be a mother to my surviving children and try to regain some of what I have lost. I will try to maintain and nurture some very positive relationships that I have found in the journey that I was forced into when Casey died and try to repair some of the ones that have fallen apart since I began this single-minded crusade to try and change a paradigm that is now, I am afraid, carved in immovable, unbendable and rigidly mendacious marble.
Camp Casey has served its purpose. It’s for sale. Anyone want to buy five beautiful acres in Crawford, Texas? I will consider any reasonable offer. I hear George Bush will be moving out soon, too…which makes the property even more valuable.
This is my resignation letter as the “face” of the American anti-war movement. This is not my “Checkers” moment, because I will never give up trying to help people in the world who are harmed by the empire of the good old US of A, but I am finished working in, or outside of this system. This system forcefully resists being helped and eats up the people who try to help it. I am getting out before it totally consumes me or anymore people that I love and the rest of my resources.
Good-bye America …you are not the country that I love and I finally realized no matter how much I sacrifice, I can’t make you be that country unless you want it.
It’s up to you now.
Reflections from an Elder Peace Veteran
Keith Lampe, Ponderosa Pine (firstname.lastname@example.org)
(May 31, 2007) — Dear Cindy, Thank you very much for dropping out of such a constricted anti-war role. Now you can represent an inclusive definition of war and thus become dramatically more effective. I’m speaking, of course, about the war against nature within which the focus of the conventional US anti-war movement is only a slice.
You’re in a fine position now to form a coalition of movements in the US (and elsewhere: right on) opposed to this unparalleled war against nature. Thus for this first time since the US invasions in Southeast Asia you can provide us with an opposition to war which in fact is historically influential.
What I mean becomes clearer when I insert here something I’d sent to my lists on February 12, 2007:
Dear Friends and Colleagues,
I want to return to this important topic today to suggest that we add the word More to the name of the coalition: No More War Against Nature Coalition (NMWAN). Also I want to list the currently-isolated US movements for which this coalition is rational and beneficial:
(1) The Anti-War Movement. As I pointed out yesterday, their current behavior is futile. If they finally open themselves up to this inclusive concept of No More War Against Nature, we stand a chance of avoiding the impending home-planet die-back.
(2) The Environmental Movement. They’re so weak now that what do they have left to lose? They have by far the best biocentric information on the War Against Nature. Perhaps this way they can regain a determination to bring this war to an end.
(3) The Feminist Movement. The War Against Nature is a mega-macho energy which the US feminist movement has thus far avoided addressing. The time is now. The War Against Nature does not benefit feminists.
(4) The 9/11 Truth Movement. They have by far the best information on the central cause of the current wars against nature in Afghanistan and Iraq. Once folks understand how extensively the BOOsch Junta has lied about 9/11, they’ll be ready to understand that equally extensive lies are being told over and over again to instill the delusion that there are no energy modes capable of quickly replacing coal and oil.
(5) The New Energy Truth Movement. They have by far the best information on these marvelous new energy modes which don’t impact nature negatively and thus can end the war against nature swiftly.
(6) It would be helpful also to have some sort of elders’ group as part of this dynamic mix. For one thing, the elders can tell young people what local weather was like when they were young — so young people can understand just how serious have been the effects of the War Against Nature already. One great advantage of elders is that they have lots of free time.
When combined, these several formidable energies can have a tremendous impact on US society now. The enhanced confidence felt by all activists in this strong new community will greatly increase their effectiveness. Looking back, they will understand just how effective the Fourth Reich’s ongoing divide-and-conquer strategy had been. And this coalition can bring together so many different sorts of campus activists that perhaps a new student movement will be born. I’m eager for your comments on this.
As far as I know, Cindy, nobody is working on fusing these haplessly isolated movements. I sure hope you can be the one to do so. Otherwise, I see no possibility of effective resistance to the Demopublican War Party. And I say this from long experience with various movements.
Forty years ago I’d been — like you now — an anti-war spokesperson (mainly via Veterans and Reservists to End the War in Vietnam) whose face appeared frequently on TV. My life also was threatened. I sacrificed two marriages to my activism and also “have traveled for extended periods of time away from” my children.
I left the anti-war movement in late ’68 in order to shift from an anthropocentric to a biocentric activism and start coping with what today is called Global Warming (though Climate Chaos or some such is a much better label). A few months later Michael McClure, Gary Snyder and I founded the US environmental movement.
I was co-founder of All-Species Projects in ’78 — and in ’91 during the bombing of Baghdad I founded the US Pro-Democracy Movement, pointing out that the US needed one at least as much as Burma did. So I have to be surprised that anyone is surprised that the recent timid Democratic congressional anti-war initiative has collapsed so ignominiously. Let’s remember that this same Democratic Party during its ’68 convention in Chicago mainly remained silent while the local police committed mayhem against unarmed anti-war demonstrators.
(See Toronto Star Columnist David Lewis Stein’s LIVING THE REVOLUTION: The Yippies in Chicago, Bobbs-Merrill, ’69.) Since then, it has never been able to attain a significant degree of integrity.
I wish you the very best at whatever activities you now select.
With highest regards.
Keith Lampe, Ro-Non-So-Te,
May 30th, 2007 - by admin
Nick Turse / Tomgram – 2007-05-30 23:53:15
The Air War in Iraq Uncovered
Tom Englehadt / Tomgram
In a recent inside-the-fold round-up of the previous day’s mayhem in Iraq, David S. Cloud, writing for my hometown paper, devoted 729 words to an account of American casualties from IEDs (“Six American soldiers and their interpreter were killed by a roadside bomb in western Baghdad…”), Iraqi Army, police, insurgent, and civilian casualties, and various bombers — all of whom were on the ground: suicide bombers, car bombers, truck bombers.
Nine words in the report were devoted to the American air war: “American troops killed eight suspected insurgents on Sunday, the military said — six in an airstrike near Garma, in Anbar Province, and two southwest of Baghdad.”
We have no further information on that air strike in Garma; no idea what kind of aircraft struck, or with what weaponry, or how those in the air were so certain that those dead on the ground were “suspected insurgents,” or who exactly suspected them of being insurgents. The equivalent Washington Post round-up did not even mention that the operation involved an air strike.
This has been fairly typical of the last few years of minimalist to nonexistent mainstream media coverage of the air war in Iraq, based almost singularly on similarly minimalist military press handouts or statements. We do, however, know something about an air strike, also “in the Garma area,” last December in which the US military announced that it had “destroyed a foreign fighter safe house in a Sunni insurgent stronghold west of Baghdad, killing five insurgents, two women and a child.”
Local residents later claimed to an Iraqi journalist that the strike had actually “killed nine members of the same family — three women, three girls and three boys — and wounding a man.” Air power, for all its “precision,” remains a remarkably indiscriminate form of warfare, though headlines like this one from the BBC, are seldom seen here: “US attack ‘kills Iraqi children.'”
We also know from a recent report that the ill-covered operations of the US Air Force in Iraq and Afghanistan have nonetheless significantly degraded American equipment, in the air as on the ground.
According to the Air Combat Command’s Gen. Ronald Keys, US planes and helicopters are wearing down (and out) from conducting so many missions “in harsh environments.” For instance, the general tells us that the A-10 — a plane used regularly because “its cannon is particularly effective in strafing” — is increasingly likely to have “cracked wings.”
Keep in mind that, however poorly covered these last years, air power has long been the American way of war. After all, it was no mistake that the Iraq war began with a pure show of air power meant to “shock and awe” not just Iraqis but the world.
And yet, in recent years in Iraq, the only “bombers” we hear about are of the suicide car or truck variety. This is strange indeed, because nothing should have stopped American journalists from visiting our air bases in the region, from spending time with pilots, or from simply looking up at the evidently crowded skies over their hotels.
The only good mainstream report on American air power in Iraq in this period has been Seymour Hersh’s New Yorker piece, “Up in the Air,” in December 2005 — significantly enough, by a journalist who had never set foot in Iraq. He reminded us then of something forgotten for several decades — that President Richard Nixon’s “Vietnamization” plan to withdraw all American “ground troops” (but not tens of thousands of US advisors) from South Vietnam also involved a massive ratcheting upward of the American air war.
Hersh reported that, in late 2005, George W. Bush’s Iraqification formula (“Our strategy is straightforward: As Iraqis stand up, Americans will stand down…”) was but a Vietnamization plan in sheep’s clothing.
As he wrote at the time: “A key element of the drawdown plans, not mentioned in the President’s public statements, is that the departing American troops will be replaced by American airpower. Quick, deadly strikes by US warplanes are seen as a way to improve dramatically the combat capability of even the weakest Iraqi combat units.”
In recent months, as the revived Taliban has surged in Afghanistan and US as well as NATO troops have proven in short supply, this is just what has happened. Air power has increasingly been called upon; civilian casualties have been spiking; and Afghans have been growing ever more upset and oppositional. Iraq will undoubtedly be next. There is, as Nick Turse indicates below, already evidence that the use of air power is “surging” in that country.
Here, then, is a post-surge formula to keep in mind: “Withdrawal” equals an increase in air power (as long as the commitment to withdraw isn’t a total one). This is no less true of the “withdrawal” plans of the major Democratic presidential candidates and the Democratic congressional mainstream as it is of any administration planning for future draw-downs.
All of these plans are largely confined to withdrawing or redeploying American “combat brigades,” which add up to only something like half of all American forces in Iraq. None of this will necessarily lessen the American war there.
As Patrick Clawson, the deputy director of the Washington Institute for Near East Policy, told Hersh, it may only “change the mix of the forces doing the fighting.” A partial withdrawal is actually likely, at least for a time, to increase the destructive brutality of the war on the American side.
Since 2004, Tomdispatch has, from a distance, been following as carefully as possible what can be known about the American air war in Iraq (and Afghanistan). Tomdispatch regular Nick Turse has been heroically on the job of late.
The piece that follows is, I believe, the best assessment of the air war that can, at present, be found in our media world. When you read this piece about what we do — and mainly don’t — know on the subject, you need to imagine that somewhere down the line, as “withdrawal” begins, there is likely to be worse to come, possibly far worse, in terms of destruction from the air. (This piece appears in abbreviated form in the latest issue of the Nation Magazine.) Tom
The Shape of a Shadowy Air War
Nick Turse / TomDispatch
Did the US military use cluster bombs in Iraq in 2006 and then lie about it? Does the US military keep the numbers of rockets and cannon rounds fired from its planes and helicopters secret because more Iraqi civilians have died due to their use than any other type of weaponry?
These are just two of the many unanswered questions related to the largely uncovered air war the US military has been waging in Iraq.
What we do know is this: Since the major combat phase of the war ended in April 2003, the US military has dropped at least 59,787 pounds of air-delivered cluster bombs in Iraq — the very type of weapon that Marc Garlasco, the senior military analyst at Human Rights Watch (HRW) calls, “the single greatest risk civilians face with regard to a current weapon that is in use.”
We also know that, according to expert opinion, rockets and cannon fire from US aircraft may account for most US and coalition-attributed Iraqi civilian deaths and that the Pentagon has restocked hundreds of millions of dollars worth of these weapons in recent years.
Unfortunately, thanks to an utter lack of coverage by the mainstream media, what we don’t know about the air war in Iraq so far outweighs what we do know that anything but the most minimal picture of the nature of destruction from the air in that country simply can’t be painted. Instead, think of the story of US air power in Iraq as a series of tiny splashes of lurid color on a largely blank canvas.
Even among the least covered aspects of the air war in Iraq, the question of cluster-bomb (CBU) use remains especially shadowy. This is hardly surprising. After all, at a time when many nations are moving toward banning the use of cluster munitions — at a February 2007 conference in Oslo, Norway, 46 of 48 governments represented supported a declaration for a new international treaty and ban on the weapons by 2008 — the US stands with China, Israel, Pakistan, and Russia in opposing new limits of any kind.
Little wonder. The US military has a staggering arsenal of these weapons. According to a recent Human Rights Watch report, the Army holds 88% of the Pentagon’s CBU inventory — at least 638.3 million of the cluster bomblets that are stored inside each cluster munition; the Air Force and Navy, according to Department of Defense figures, have 22.2 million and 14.7 million of the bomblets, respectively. And even these numbers are considered undercounts by experts.
A cluster bomb bursts above the ground, releasing hundreds of smaller, deadly submunitions or “bomblets” that increase the weapon’s kill radius causing, as Garlasco puts it, “indiscriminate effects.” It’s a weapon, he notes, that “cannot distinguish between a civilian and a soldier when employed because of its wide coverage area. If you’re dropping the weapon and you blow your target up you’re also hitting everything within a football field. So to use it in proximity to civilians is inviting a violation of the laws of armed conflict.”
Worse yet, US cluster munitions have a high failure rate. A sizeable number of dud bomblets fall to the ground and become de facto landmines which, Garlasco points out, are “already banned by most nations on this planet.” Garlasco adds: “I don’t see how any use of the current US cluster bomb arsenal in proximity to civilian objects can be defended in any way as being legal or legitimate.”
In an email message earlier this year, a US Central Command Air Forces (CENTAF) spokesman told this reporter that “there were no instances” of CBU usage in Iraq in 2006. But military documents suggest this might not be the case.
Last year, Titus Peachey of the Mennonite Central Committee — an organization that has studied the use of cluster munitions for more than 30 years — filed a Freedom of Information Act request concerning the US military’s use of cluster bombs in Iraq since “major combat operations” officially ended in that country.
In their response, the Air Force confirmed that 63 CBU-87 cluster bombs were dropped in Iraq between May 1, 2003 and August 1, 2006. A CENTAF spokesman contacted for confirmation that none of these were dropped on or after January 1, 2006, offered no response. His superior officer, Lt. Col. Johnn Kennedy, the Deputy Director of CENTAF Public Affairs, similarly ignored this reporter’s requests for clarification.
These 12,726 BLU-97 bomblets — each CBU-87 contains 202 BLU-97s or “Combined Effects Bombs” (CEBs) which have anti-personnel, anti-tank, and incendiary capabilities or “kill mechanisms” — dropped since May 2003 are, according to statistics provided by Human Rights Watch, in addition to almost two million cluster submunitions used by coalition forces in Iraq in March and April 2003.
Asked about CBU usage by the Air Force in Iraq in 2006, Ali al-Fadhily, an independent Iraqi journalist, commented: “The use of cluster bombs is a sure thing, but it was very difficult to prove because there were no international experts to document it.” In the past, however, international experts have actually had a chance to examine some locations where a fraction of the bomblets that coalition forces used have landed.
On a 2004 research trip to Iraq, for instance, Titus Peachey visited numerous sites which had experienced such strikes. At a farm in northern Iraq, he was shown not only impact craters from exploded bomblets on a farmer’s property but also unexploded bomblets, by a team from the Mines Advisory Group, a humanitarian organization devoted to landmine and bomb clearance.
While “the de-miners expressed frustration that the farmer had planted his field before it had been cleared,” Peachey explained that this was a common, if dangerous, practice in such situations. The US used similar ordnance in Laos during the Vietnam War, he pointed out, noting:
“The villagers of Laos waited more than 20 years for clearance work to get started in their fields and villages. During that time they had no choice but to till soil that was filled with bombs. Otherwise they could not eat. In Iraq, the several visits that we made confirmed this very same dynamic. People could not afford to wait until clearance teams made their farms safe for cultivation. They had to take great risks in order to survive.”
Evidence of these risks can be found in US military documents. Case in point: a June 2005 internal memorandum from the US Army’s 42d Infantry Division which describes how a 15-year old Iraqi boy, working as a shepherd, “was leading the sheep through north Tikrit, near an ammo storage site, when he picked up a UXO [unexploded ordnance] from a cluster bomb.
The UXO detonated and he was killed.” Asked to pay $3,000 in compensation for the boy’s life, the Army granted that his death was “a horrible loss for the claimant,” his mother, but concluded that there was “insufficient evidence to indicate that US. Forces caused the death.”
Iraqi documents also chronicle the effects of air-delivered cluster munitions. Take a September 2006 report by the Conservation Center of Environment & Reserves, an Iraqi non-governmental organization (NGO), examining alleged violations of the laws of war by US forces during the April 2004 siege of Fallujah.
According to its partial list of civilian deaths, at least 53 people were killed by air-launched cluster bombs in the city that April. An analysis of data collected by another Iraqi NGO, the Iraqi Health and Social Care Organization, showed that, between March and June 2006, of 193 war-injured casualties analyzed, 148 (77%) were the result of cluster munitions of unspecified type.
Air War, Iraq: 2006
While cluster bombs remain a point of contention, Air Force officials do acknowledge that US military and coalition aircraft dropped at least 111,000 pounds of other types of bombs on targets in Iraq in 2006. This figure — 177 bombs in all — does not include guided missiles or unguided rockets fired, or cannon rounds expended; nor, according to a CENTAF spokesman, does it take into account the munitions used by some Marine Corps and other coalition fixed-wing aircraft or any Army or Marine Corps helicopter gunships; nor does it include munitions used by the armed helicopters of the many private security contractors flying their own missions in Iraq.
In statistics provided to me, CENTAF reported a total of 10,519 “close air support missions” in Iraq in 2006, during which its aircraft dropped those 177 bombs and fired 52 “Hellfire/Maverick missiles.” The Guided Bomb Unit-12, a laser-guided bomb with a 500-pound general purpose warhead — 95 of which were reportedly dropped in 2006 — was the most frequently used bomb in Iraq last year, according to CENTAF.
In addition, 67 satellite-guided, 500-pound GBU-38s and 15 2,000-pound GBU-31/32 munitions were also dropped on Iraqi targets in 2006, according to official US figures. There is no independent way, however, to confirm the accuracy of this official count.
Rockets, like the 2.75-inch Hydra-70 rocket which can be outfitted with various warheads and fired from either fixed-wing aircraft or most military helicopters, are conspicuously absent from the totals — so as not to “skew the tally and present an inaccurate picture of the air campaign,” said a CENTAF spokesman mysteriously. If released, these figures might, however, prove impressive indeed.
According to a 2005 press release issued by Sen. Patrick Leahy (D-VT), who helped secure a five-year, $900 million Hydra contract from the Army for General Dynamics, “the widely used Hydra-70 rocket… has seen extensive use in Afghanistan and Iraq… [and] has become the world’s most widely used helicopter-launched weapon system.” By this April, $502 million in orders for the Hydra-70 had been placed by the Army since the contract was awarded.
The number of cannon rounds — essentially large caliber “bullets”– fired by CENTAF aircraft is also a closely guarded secret. The official reason given is that “special forces often use aircraft such as the AC-130” gunships, which fire cannon rounds, and “their missions and operations are classified, so therefore these figures are not released.”
However, an idea of the number of cannon rounds expended by CENTAF aircraft can be gleaned from a description of a single operation on January 28, 2007 when US F-16s and A-10 Thunderbolts not only “dropped more than 3.5 tons of precision munitions,” but also fired “1,200 rounds of 20mm and 1,100 rounds of 30mm cannon fire” in a five square mile area near the southern city of Najaf.
A sense of usage levels can also be gathered from a consideration of contracts awarded in recent years. Take the 20mm PGU-28 ammunition used by helicopters like the AH-1 Cobra and fixed-wing aircraft like the F-16. In 2001, the Department of Defense noted that it held approximately eight million PGU-28/B rounds in its inventory.
In May 2003, the Army took steps to increase that arsenal by modifying an existing contract with General Dynamics to add 980,064 rounds of 20mm ammunition to 1.3 million rounds already delivered since December 2001.
In February 2004, General Dynamics was awarded an almost $11 million add-on to an already existing contract for an extra 427,000 cannon rounds for the AH-1 Cobra helicopter. In September 2006, General Dynamics was awarded a similar nearly $14 million add-on for yet more 20mm ammunition; and, in April 2007, $22 million for more of the same.
That same month, the US Army Sustainment Command issued a “sources sought notice,” looking for more arms manufacturers willing to produce six million or more rounds of such ordnance with promises of an “estimated 400% option over 5 years.”
Yet, repeated inquiries about cannon rounds fired in Iraq prompted a CENTAF spokesman to emphatically state in an email: “WE DO NOT REPORT CANNON ROUNDS.”
Lt. Col. Johnn Kennedy followed up, noting, “Glad to see you appreciate the tremendous efforts [my subordinate] has already expended on you. Trust me, it’s probably much more significant than the relentless pursuit of the number of cannon rounds.”
But the number of cannon rounds and rockets fired by US aircraft is hardly an insignificant matter. According to Les Roberts, co-author of two surveys of mortality in Iraq published in the British medical journal, The Lancet, “Rocket and cannon fire could account for most coalition-attributed civilian deaths.” He adds, “I find it disturbing that they will not release this [figure], but even more disturbing that they have not released such information to Congressmen who have requested it.”
In 2004, Roberts himself witnessed the destruction caused by cannon fire in Baghdad’s vast Shiite slum, Sadr City. He recalls again and again passing through 100-200 meter-wide areas of neighborhoods that had been raked by cannon rounds. “It wasn’t one house that was beat up,” he recalled. “It would be five, six, seven buildings in a row.” Unlike bomb- and artillery-ravaged Ramadi and Fallujah, Roberts noted:
“There weren’t whole buildings knocked down. There were just big swaths of many, many houses where every window was broken, where there were thousands of pockmarks from cannon fire; not little dents, but huge chunks the size of your fist out of the walls, and lamp-posts bent over because they lost their integrity from being hit so many times.”
This portrait of devastation is echoed in the words of journalist Ali al-Fadhily, who told me that he had witnessed helicopter gunships in action, noting: “The destruction they caused was always immense and casualties so many. They simply destroy the target with every living soul inside. The smell of death comes with those machines.”
While the destructive capacity of helicopter gunships has been well-documented and we have indications of the levels of ammunition available to the military, the actual scale of use is hard to pin down.
Flight hours are, however, another indication. According to James Glantz of the New York Times, Army helicopters logged 240,000 flight hours in Iraq in 2005, 334,000 in 2006, and projections for 2007 suggest that the figure will reach 400,000. (And these numbers don’t even include Marine Corps squadrons, heliborne missions by private security contractors, or those of the nascent Iraqi Air Force.)
Top Secret Information
While military press information officers continue to stonewall on the number of cannon rounds fired by helicopters (“We cannot comment on your inquiry due to operational security”), earlier this year Col. Robert A. Fitzgerald, the Marine Corps’ head of aviation plans and policy, was quoted in National Defense Magazine on the subject.
He claimed that, in 2006, “Marine rotary-wing aircraft flew more than 60,000 combat flight hours, and fixed-wing platforms completed 31,000. They dropped 80 tons of bombs and fired 80 missiles, 3,532 rockets and more than 2 million rounds of smaller ammunition.” (When asked if Col. Fitzgerald’s admission endangered “operational security,” a military spokesman responded, “I cannot comment on the policies or release authority of a Marine colonel.”)
While Col. Fitzgerald’s statistics presumably also include operations in Afghanistan (where we know US air power has been called upon ever more heavily), they do remind us that the minimalist figures regularly given out by CENTAF hardly offer an accurate picture of the air war in Iraq.
When combined with the military’s evasive non-answers, they are also a reminder of what a dearth of information is actually available on even seemingly innocuous matters relating to the air war in Iraq.
For example, from January through April, I posed questions to a Coalition Press Information Center media contact — one “SSG Wiley.” After being rebuffed on the topic of munitions expenditure, I asked, in January, about the total number of “rotary-wing sorties” flown in 2006. The aptly-named Wiley responded that s/he “sent it out to the relevant directorates and [was] awaiting a response…. I will contact you as soon as I get something.” That turned out, despite follow-up, to be never.
Following a March 30th query regarding “the relevant directorates,” s/he entreated me, by email, to drop my request for information. Facing the reportorial void, I asked if Wiley would at least provide his/her full name and title for attribution in this article. S/he has yet to respond.
The New Iraqi Air Force
Another little-talked about aspect of the air war is the modest emergence of a new Iraqi Air Force (IAF). Until the first Gulf War, the Iraqi military had a large air contingent, including hundreds of modern Russian and French combat aircraft.
Today, apparently owing to US reluctance to put powerful modern weaponry of any sort in Iraqi hands, the reconstituted IAF is a distinctly less impressive force. Instead of advanced fighters and bombers, they fly SAMA CH-2000 two-seat, single-engine prop airplanes, SB7L-360 Seeker reconnaissance aircraft, a handful of C-130 Hercules turbo-prop cargo planes, and Bell 206 Ranger, UH-1HP “Huey” and Russian Mi-17 helicopters based out of military installations in Baghdad, Basra, Kirkuk, and Taji.
Recently returning from a fact-finding mission in Iraq, undertaken in his capacity as an adjunct professor at the United States Military Academy at West Point, retired US Army Gen. Barry McCaffrey called for sending more aircraft, including 150 helicopters, to the Iraqi security forces.
In fact, the IAF recently did take delivery of newly refurbished helicopters at Taji Air Base, is scheduled to receive new aircraft at Kirkuk, and has contracted to add 28 new Mi-17 helicopters in the near future.
The IAF may even be conducting full-scale air strikes of its own sometime soon. As of April 1, 2007, five Iraqi Bell 206 Ranger pilots from its 12th Squadron had already logged more than 188 combat hours. In a recent Air Force Times article, Capt. Shane Werley, the chief American advisor to the IAF’s 2d Squadron, asserted that pilots he was working with would, at an unspecified date, “be taking missions from the [Army’s] 1st Cavalry [Division at Taji]…. The bottom line is we’re getting these guys back in the fight.”
The Scale of the Carnage
Just a few dogged reporters assigned to the air-power beat might, at least, have offered some sense of the human fall-out of this largely one-sided air war. Since this has not been the case, we must rely on the best available evidence. One valuable source is the national cross-sectional cluster sample survey of mortality in Iraq since the 2003 invasion, published last year in The Lancet which used well-established survey methods that have been proven accurate in conflict zones from Kosovo to the Congo. (Interviewers actually inspected death certificates in an overwhelming majority of the Iraqi households surveyed.)
Carried out by epidemiologists at Johns Hopkins University’s Bloomberg School of Public Health and Iraqi physicians organized through Mustansiriya University in Baghdad, it estimated 655,000 “excess Iraqi deaths as a consequence of the war.”
The study also found that, from March 2003 through June 2006, 13% of violent deaths in Iraq were caused by coalition air strikes. If the 655,000 figure, including over 601,000 violent deaths, is accurate, this would equal approximately 78,133 Iraqis killed by bombs, missiles, rockets, or cannon rounds up to last June.
There are also indications that the air war has taken an especially grievous toll on Iraqi children. Figures provided by The Lancet study’s authors suggest that 50% of all violent deaths of Iraqi children under 15 years of age in that same period were due to coalition air strikes.
These findings are echoed by Conservation Center of Environment & Reserves’ statistics, indicating that no fewer of 25 of the 59 Iraqis on their partial list of those killed by air strikes during the April 2004 siege of Fallujah were children.
The Iraq Body Count Project (IBC), a group of researchers based in the United Kingdom who maintain a public database of Iraqi civilian deaths resulting from the war, carefully restricts itself to media-documented reports of civilian fatalities. While its figures are consequently much lower than The Lancet’s — currently, its tally range stands at: 64,133-70,243 — an analysis of its media-limited data offers a glimpse of the human costs of the air war.
Statistics provided by the Iraq Body Count Project show that from 2003-2006, coalition air strikes, according to media sources alone (which, as we know, have covered the air war poorly), killed 3,615-4,083 people and left another 11,956-12,962 wounded.
Last year, media reports listed between 169-200 Iraqis killed and 111-112 injured in 28 separate coalition air strikes, according to the IBC project. These numbers also appear to be on the rise. John Sloboda, the project’s spokesperson and co-founder notes by email that, during 2006, the “vast majority” of lethal air strikes took place during the latter half of the year.
Asked about the assertion that the second half of 2006 was deadlier for Iraqis, due to US air strikes, and the possible reasons for this, Lt. Col. Kennedy waxed eloquent: “War, by its very nature, has ebbs and flows, and we constantly review the application of airpower to best support the forces on the ground in theater. We view this as simply part of our contract to the warfighters. As we do not discuss operational aspects of missions, I’ll decline further comment.”
But recently, Air Force Chief of Staff T. Michael Moseley did admit that he had “anecdotal evidence” suggesting “airpower is the most lethal of the components in wrapping up bad guys.” He continued, “As far as numbers of people killed, as far as wrapping up bad guys and as far as delivering a kinetic effect, the air component — which also includes Marine and Navy air, by the way — is the most lethal of the components.”
According to IBC’s figures, during the first three months of 2007, US air attacks had already killed more than half as many civilians as had died in all air strikes last year — some 95-107 deaths; and publicly available CENTAF statistics indeed do show a surge in close air-support missions in 2007.
For example, between March 24 and March 30, 2006, CENTAF reported 366 close air support missions. In 2007, the number for the same dates skyrocketed to 437 — an almost 20% jump.
The Secret of Why the Air War Is So Secret
Unfortunately, media reports on the air war are so sparse, with reporting confined largely to reprinting US military handouts and announcements of air strikes, that much of the air war in Iraq remains unknown — although the very fact of an occupying power regularly conducting air strikes in and near population centers should have raised a question or two.
Echoing Ali al-Fadhily’s comments about the dearth of international observers in Iraq, Garlasco of Human Rights Watch notes, “Because of the lack of security we’ve had no one on the ground for three years now, and so we have no way of knowing what’s going on there.” He adds, “It’s a huge hole in all the human rights organizations’ reporting.”
But human rights organizations and other NGOs are just part of the story. Since the Bush administration’s invasion, the American air war has been given remarkably short shrift in the media.
Back in December 2004, Tom Engelhardt, writing at Tomdispatch, called attention to this glaring absence. Seymour Hersh’s seminal piece on air power, “Up in the Air,” published in the New Yorker in late 2005, briefly ushered in some mainstream attention to the subject. And articles by Dahr Jamail, an independent journalist who covered the American occupation of Iraq, before and after the Hersh piece, are among the smattering of pieces that have offered glimpses of the air campaign and its impact.
To date, however, the mainstream media has not, to use the words of Lt. Col. Kennedy, engaged in a “relentless pursuit of the number of cannon rounds” fired — or any other aspect of the air war or its consequences for Iraqis.
Les Roberts especially laments just “how profoundly the press has failed us” when it comes to coverage of the war. “In the first couple of years of the war,” he says, “our survey data suggest that there were more deaths from bombs dropped by our planes than there were deaths from roadside explosives and car bombs [detonated by insurgents].”
The only group on the ground systematically collecting violent death data at the time, the NGO Coordinating Committee for Iraq, he notes, found the same thing. “If you had been reading the US papers and watching the US television news at the time,” Roberts adds, “you would have gotten the impression that anti-coalition bombs were more numerous. That was not just wrong, it probably was wrong by a factor of ten!”
With the military unwilling to tell the truth – or say anything at all, in most cases– and unable to provide the stability necessary for NGOs to operate, it falls to the mainstream media, even at this late stage of the conflict, to begin ferreting out substantive information on the air war. It seems, however, that until reporters begin bypassing official US military pronouncements and locating Iraqi sources, we will remain largely in the dark with little knowledge of what can only be described as the secret US air war in Iraq.
Nick Turse is the associate editor and research director of Tomdispatch.com. He has written for the Los Angeles Times, the San Francisco Chronicle, the Nation, the Village Voice, and regularly for Tomdispatch. A shorter version of this piece appears in this week’s Nation Magazine.
Copyright 2007 Nick Turse
Posted in accordance with Title 17, US Code, for noncommericial, educational purposes.
May 30th, 2007 - by admin
Ahmed Janabi / Al-Jazeera & Tina Susman / Los Angeles Times – 2007-05-30 23:34:47
Row over Iraq Oil Law Ahmed Janabi / Al-Jazeera
Kirkuk’s fate will be determined through a referendum this year. A draft law being considered by the Iraqi parliament would enable US companies to take control of Iraq’s oil industry, oil experts in the country say.
The proposed bill, approved by the Iraqi government in February after months of wrangling, opens the country’s oil sector to foreign investors 35 years after it was nationalised.
“The law is designed for the benefit of US oil companies,” Ramzy Salman, an Iraqi economist who worked for the Iraqi oil ministry for 30 years, said. “If approved, it would take things back to where they were before the nationalisation of Iraq’s oil in 1972.” But he said the situation would be reversed when Iraqis regained their “true sovereignty”.
Salman said: “If there is something that should be worked on, it is the [Iraqi] constitution. “The constitution contains serious gaps in terms of who is in charge of the oil and its revenues … [despite the] oil in Iraq being under every Iraqi river, desert, marsh and farm.”
The new law, if approved, would authorise production share agreements (PSAs), which offer huge profits for foreign oil companies.
PSAs are normally ideal for poorer countries exploring virgin lands or wanting to extract oil from fields where the resource is well below the surface and are designed to protect investors from the risks involved in such exploration projects.
But Iraqi oil experts say investors face virtually no risk, as the country’s oil is the cheapest to extract worldwide, and is of such a high quality that it sells at a premium on world markets.
Issam al-Chalabi, Iraq’s former oil minister, said PSAs were completely inappropriate for Iraq.
He said: “An oil barrel in most of Iraq’s oilfields costs between 50 cents and one dollar to extract. Iraq’s fields are also proven, and investing in them is risk-free.
“These kinds of agreements are normally given when there is a risk, as the case in Sudan, Yemen and several other countries, where companies invest money with great risk that they would not find oil, or they find difficult to extract oil.”
Al-Chalabi said PSAs were a highly profitable formula for oil companies and in many cases they were granted for “political reasons. Under no circumstances would Iraq relinquish its authority, its responsibility and its control over Iraq’s natural resources”
“In the 1990s, the government of Saddam Hussein gave PSAs to Russian and Chinese oil companies, but it was more of a political decision than economic,” al-Chalabi said.
“The US and its allies lobbied in the 1990s against Iraq in order to tighten UN sanctions, while Iraq was betting on Russia and China to help remove or at least ease the sanctions.” He said the contracted Russian and Chinese oil companies were mostly government-owned.
The 12.5 percent profit protected by the new law is also disputed by many as being too low. Al-Chalabi said the percentage was excessive given current oil prices.
“Iraq’s PSA with the Chinese and Russians gave a profit percentage less than 10 per cent when the oil barrel price was around $25, but now the barrel is over $60 which means the percentage of 12.5 per cent is too high,” he said.
Break-up of Iraq
The draft law would give Iraq’s provinces a free hand in giving exploration and production contracts, which some fear will lead to a decline in the authority of the central government over the country’s main resource.
Observers say that if the new law is approved, it will also encourage separatists in the oil-rich provinces to split off. Eventually the break-up of Iraq would be impossible to prevent.
Iraq’s constitution allows governorates to form a semi-independent regions, which enjoy full rights in controlling natural resources.
Dhafir al-Ani, an Iraqi member of parliament, said: “The proposed oil law is the best possible in the current situation. “However, if there are some gaps in it, then the reason is the constitution, which contains several controversial issues and needs to reconsidered.”
Iraqi officials insisted in a forum held in Dubai last month that the bill due to be submitted to parliament will keep the country’s oil wealth in Iraqi hands and benefit all of its warring communities.
“Under no circumstances would Iraq relinquish its authority, its responsibility and its control over Iraq’s natural resources,” Hussein Shahristani, the country’s oil minister, told reporters in the United Arab Emirates.
Muhammad Bahr al-Ullom, who laid the early foundations of the current draft oil law when he served as Iraq’s first post-war oil minsiter in 2004, has told reporters that he is in favour of the new law. He said it would not put Iraq’s oil at the hands of foreign oil companies and it would not devide Iraq.
Al Jazeera.net contacted Bahr al-Uloom in Iraq and agreed with him to call a few hours later for a telephone interview. However, there was no answer to a telephone call at the appointed time or when subsequent attempts to reach him were made.
Kurds and the New Law
Ashti Hawrami, oil minister for the Iraqi Kurdish region, said at the Dubai conference that the Kurds would reject any ammendments to the suggested law and that they would go ahead with deals they have already made, whether the law was approved or not.
Al-Ani agreed with Salman that the proposed law was a “political” deal to strengthen US allies in Iraq. He said: “We are a democratically elected legistlative body, if we would blindly approve anything presented to us, then why are we there? I prefer we go home. We have increasing signs that the law is a political deal.”
Iraq’s Kurdish semi-autonomous region has already given PSAs to foreign oil companies, and is in favour of the proposed oil law. The region may well gain control of the oil-rich governorate of Kirkuk through a referendum due to be held later this year.
If the new law is approved and the Kirkuk referendum came in favour of the Kurds, the Kurdish region would enjoy huge economic power.
Iraqis Resist US Pressure to Enact Oil Law
Tina Susman / Los Angeles Times
(May 13, 2007) — Foreign investment and Shiite control are the primary concerns. A White House deadline for passage is in doubt.
It has not even reached parliament, but the oil law that U.S. officials call vital to ending Iraq’s civil war is in serious trouble among Iraqi lawmakers, many of whom see it as a sloppy document rushed forward to satisfy Washington’s clock. Opposition ranges from vehement to measured, but two things are clear:
The May deadline that the White House had been banking on is in doubt. And even if the law is passed, it fails to resolve key issues, including how to divide Iraq’s oil revenue among its Shiite, Kurdish and Sunni regions, and how much foreign investment to allow. Those questions would be put off for future debates.
The problems of the oil bill bode poorly for the other so-called benchmarks that the Bush administration has been pressuring Prime Minister Nouri Maliki’s government to meet. Those include provincial elections, reversing a prohibition against former Baath Party members holding government and military positions and revision of Iraq’s constitution. Republican leaders in Washington have warned administration officials that if the Iraqi government fails to meet those benchmarks by the end of the summer, remaining congressional support for Bush’s Iraq policies could crumble.
Their impatience was underscored Wednesday by Vice President Dick Cheney during a visit here. “I did make it clear that we believe it’s very important to move on the issues before us in a timely fashion, and that any undue delay would be difficult to explain,” Cheney told reporters.
But Iraqi lawmakers show little sign of bending to accommodate Bush on an issue as crucial as oil. “We have two clocks — the Baghdad clock and the Washington clock — and this is a perfect example,” said Mahmoud Othman, a lawmaker from the semiautonomous Kurdish region of northern Iraq. “This has always been the case. Washington has been pushing the Iraqis to do things to fit their agenda.”
Iraq is believed to have some of the world’s largest oil reserves, about 115 billion barrels. The country’s 2007 budget is based on predictions that oil proceeds will reach $31 billion, 93% of the government’s revenue. But war and political instability have kept production down.
Just before the US-led invasion in March 2003, production was 2.6 million barrels per day. US officials predicted a rapid rise to 3 million barrels. Instead, Iraq often has struggled to push the daily total to 2 million barrels because of obsolete equipment and security problems.
The oil law is supposed to change this by opening the industry to foreign investors who could modernize equipment and increase production. U.S. officials hope that spreading oil profit fairly across the country would cause instability to ebb. Iraq’s cabinet, the Council of Ministers, approved a draft oil measure in February.
From there, it was to go to parliament. U.S. officials predicted passage would be quick, but it has stalled. The objections are as vast and technical as the measure itself and reflect the wider problems facing Iraq: regional distrust of the Shiite-led central government; wariness of foreign interest; and anger toward the United States, which many Iraqis believe invaded Iraq solely to get its hands on the oil.
The Kurdish regional government voiced its opposition to the measure last month after seeing lists drawn up by the Iraqi central government that categorized the oil fields according to levels of development and geographical boundaries. Those factors would determine who would manage the fields and the contracts involving them — regional authorities or the state-run Iraq National Oil Co., which has yet to be established.
Kurdish authorities say the lists gave 93% of fields to the national oil company, including some they say are at least partially in Kurdish territory. Their dissatisfaction has been made blazingly clear on the Kurdistan regional government website, which has posted the lists along with comments in red letters beside the sections they oppose. “WRONG!” and “TOO BIG!” are common remarks. Kurdish officials have said that unless the lists are redrawn, they will not support the bill. Kurdish parties control about one-fifth of the parliament.
Other points of contention, which have drawn in Sunnis as well as Shiites, involve the mechanism for distributing oil profit and the degree of foreign participation in a committee that would set policy on contracts and other industry issues. None of those is clarified in the proposed legislation. “Quite a lot of it is not good, to be honest,” said a Western energy expert in Baghdad who spoke on the condition of anonymity to avoid angering Iraqi officials.
“A lot of the difficult questions were fudged, like revenue sharing and who controls the oil fields. These obviously are vitally important, but they wanted a benchmark passed, so it was pushed,” he said, referring to US officials.
The question of how to divvy the money is especially troublesome because of Sunni Arab and Kurdish distrust of the Shiite-led government. Under the proposed law, the central government would control a bank account used for distributing oil proceeds. “There were ideas that checks from the single oil account should have three signatures: one should be Sunni; one should be Shiite; one should be Kurd,” said Zalmay Khalilzad, the former U.S. ambassador to Iraq who left the post in March.
Passing the measure “requires a very hands-on effort by the international community, by the United States,” Khalilzad said. “This is the paradox of this situation. We have a greater sense of urgency because of our situation than they do.” The Western energy expert said Iraqi politicians estimate that a decision will take a few months or perhaps until the end of the year. “They say, ‘Hang on, this is an important law, we’re not just going to pass it,’ ” he said.
Next to how to divide the money, the most contentious issue appears to be the role of foreign investment. The measure envisions profit-sharing agreements, which reward foreign contractors for doing business in risky environments. Even those who support the proposal as a framework have reservations about the details.
“All in all, we need the new law. The existing ones are very old,” said Haider Abadi, a member of Maliki’s Islamic Dawa Party, a Shiite group. “Having said this, though, it does not mean that at this stage we are for a full opening of the doors to foreign investment in the oil sector.”
Salim Abdullah Jabouri, a spokesman for the Sunni bloc, also expressed concern about having foreign companies profiting from Iraqi oil. “We think that the timing of this law is not suitable,” he said. Some of the fiercest opposition has come from oil workers, who threatened to go on strike this week to protest the legislation.
Imad Abdul Hussain, a leader of the Federation of Oil Unions, said workers want oil production to remain in government hands. “Oil is Iraq’s sovereignty. It is the only wealth in Iraq. It unifies Iraqis. When we give it to a foreign investor, this means the sovereignty is taken away,” he said. Energy experts, though, say Iraq has no hope of increasing production without foreign expertise and money.
Beyond all the political issues looms Iraq’s most basic problem: security. The country may need help from outside investors, but “without security and a stable regime, none of this will mean much, because they won’t come in,” said Gal Luft, an energy expert at the Institute for the Analysis of Global Security, a Washington think tank that studies energy-related security issues. There were at least 15 attacks on Iraqi oil facilities in the first three months of the year, according to the institute.
They included slayings of oil industry workers and bombings of wells and the pipeline that carries oil from Baiji, in northern Iraq, to Turkey. The number of attacks is lower than during the same period last year, but Luft said that is because saboteurs’ favorite target, the pipeline, has been hit so many times that it rarely functions. “They normally do not attack pipelines that are not in operation,” Luft said.
Posted in accordance with Title 17, US Code, for noncommerical, educational purposes.
May 30th, 2007 - by admin
Katerine Zoeff / The New York Times & Kasia Anderson / Truthdig – 2007-05-30 23:23:25
Desperate Iraqi Refugees Turn to Sex Trade in Syria
Katerine Zoeff / The New York Times
“Sometimes you see whole families living this way, the girls pimped by the mother or aunt,” she said. “But prostitution isn’t the only problem. Our schools are overcrowded, and the prices of services, food and transportation have all risen. We don’t have the proper infrastructure to deal with this. We don’t have shelters or health centers that these women can go to. And because of the situation in Iraq, Syria is careful not to deport these women.”
MARABA, Syria (May 29, 2007) — Back home in Iraq, Umm Hiba’s daughter was a devout schoolgirl, modest in her dress and serious about her studies. Hiba, who is now 16, wore the hijab, or Islamic head scarf, and rose early each day to say the dawn prayer before classes.
But that was before militias began threatening their Baghdad neighborhood and Umm Hiba and her daughter fled to Syria last spring. There were no jobs, and Umm Hiba’s elderly father developed complications related to his diabetes.
Desperate, Umm Hiba followed the advice of an Iraqi acquaintance and took her daughter to work at a nightclub along a highway known for prostitution. “We Iraqis used to be a proud people,” she said over the frantic blare of the club’s speakers. She pointed out her daughter, dancing among about two dozen other girls on the stage, wearing a pink silk dress with spaghetti straps, her frail shoulders bathed in colored light.
As Umm Hiba watched, a middle-aged man climbed onto the platform and began to dance jerkily, arms flailing, among the girls.
“During the war we lost everything,” she said. “We even lost our honor.” She insisted on being identified by only part of her name — Umm Hiba means mother of Hiba.
For anyone living in Damascus these days, the fact that some Iraqi refugees are selling sex or working in sex clubs is difficult to ignore.
Even in central Damascus, men freely talk of being approached by pimps trawling for customers outside juice shops and shawarma sandwich stalls, and of women walking up to passing men, an act unthinkable in Arab culture, and asking in Iraqi-accented Arabic if the men would like to “have a cup of tea.”
By day the road that leads from Damascus to the historic convent at Saidnaya is often choked with Christian and Muslim pilgrims hoping for one of the miracles attributed to a portrait of the Virgin Mary at the convent. But as any Damascene taxi driver can tell you, the Maraba section of this fabled pilgrim road is fast becoming better known for its brisk trade in Iraqi prostitutes.
Many of these women and girls, including some barely in their teens, are recent refugees. Some are tricked or forced into prostitution, but most say they have no other means of supporting their families. As a group they represent one of the most visible symptoms of an Iraqi refugee crisis that has exploded in Syria in recent months.
According to the United Nations high commissioner for refugees, about 1.2 million Iraqi refugees now live in Syria; the Syrian government puts the figure even higher.
Given the deteriorating economic situation of those refugees, a United Nations report found last year, many girls and women in “severe need” turn to prostitution, in secret or even with the knowledge or involvement of family members. In many cases, the report added, “the head of the family brings clients to the house.”
Aid workers say thousands of Iraqi women work as prostitutes in Syria, and point out that as violence in Iraq has increased, the refugee population has come to include more female-headed households and unaccompanied women.
“So many of the Iraqi women arriving now are living on their own with their children because the men in their families were killed or kidnapped,” said Sister Marie-Claude Naddaf, a Syrian nun at the Good Shepherd convent in Damascus, which helps Iraqi refugees.
She said the convent had surveyed Iraqi refugees living in Masaken Barzeh, on the outskirts of Damascus, and found 119 female-headed households in one small neighborhood. Some of the women, seeking work outside the home for the first time and living in a country with high unemployment, find that their only marketable asset is their bodies.
“I met three sisters-in-law recently who were living together and all prostituting themselves,” Sister Marie-Claude said. “They would go out on alternate nights — each woman took her turn — and then divide the money to feed all the children.”
For more than three years after the American-led invasion of Iraq in 2003, Iraqi prostitution in Syria, like any prostitution, was a forbidden topic for Syria’s government. Like drug abuse, the sex trade tends to be referred to in the local news media as acts against public decency. But Dietrun Günther, an official at the United Nations refugee agency’s Damascus office, said the government was finally breaking its silence.
“We’re especially concerned that there are young girls involved, and that they’re being forced, even smuggled into Syria in some cases,” Ms. Günther said. “We’ve had special talks with the Syrian government about prostitution.” She called the officials’ new openness “a great step.”
Mouna Asaad, a Syrian women’s rights lawyer, said the government had been blindsided by the scale of the arriving Iraqi refugee population. Syria does not require visas for citizens of Arab countries, and its government had pledged to assist needy Iraqis. But this country of 19 million was ill equipped to cope with the sudden arrival of hundreds of thousands of them, Ms. Asaad said.
“Sometimes you see whole families living this way, the girls pimped by the mother or aunt,” she said. “But prostitution isn’t the only problem. Our schools are overcrowded, and the prices of services, food and transportation have all risen. We don’t have the proper infrastructure to deal with this. We don’t have shelters or health centers that these women can go to. And because of the situation in Iraq, Syria is careful not to deport these women.”
Most of the semi-organized prostitution takes place on the outskirts of the capital, in nightclubs known as casinos — a local euphemism, because no gambling occurs.
At Al Rawabi, an expensive nightclub in Al Hami, there is even a floor show with an Iraqi theme. One recent evening, waiters brought out trays of snacks: French fries and grilled chicken hearts wrapped in foil folded into diamond shapes. A 10-piece band warmed up, and an M.C. gave the traditionally overwrought introduction in Arabic: “I give you the honey of all stages, the stealer of all hearts, the most golden throat, the glamorous artist: Maria!”
Maria, a buxom young woman, climbed onto the stage and began an anguished-sounding ballad. “After Iraq I have no homeland,” she sang. “I’m ready to go crawling on my knees back to Iraq.” Four other women, all wearing variations on leopard print, gyrated on stage, swinging their hair in wild circles. The stage lights had been fitted with colored gel filters that lent the women’s skin a greenish cast.
Al Rawabi’s customers watched Maria calmly, leaning back in their chairs and drinking Johnnie Walker Black. The large room smelled strongly of sweat mingled with the apple tobacco from scores of water pipes. When Maria finished singing, no one clapped.
She picked up the microphone again and began what she called a salute to Iraq, naming many of the Iraqi women in the club and, indicating one of the women in leopard print who had danced with her, “most especially my best friend, Sahar.”
After the dancers filed offstage and scattered around the room to talk to customers, Sahar told a visitor she was from the Dora district of Baghdad but had left “because of the troubles.” Now, she said she would leave the club with him for $200.
Aid workers say $50 to $70 is considered a good night’s wage for an Iraqi prostitute working in Damascus. And some of the Iraqi dancers in the crowded casinos of Damascus suburbs earn much less.
In Maraba, Umm Hiba would not say how much money her daughter took home at the end of a night. Noticing her reluctance, the club’s manager, who introduced himself as Hassan, broke in proudly.
“We make sure that each girl has a minimum of 500 lira at the end of each night, no matter how bad business is,” he said, mentioning a sum of about $10. “We are sympathetic to the situation of the Iraqi people. And we try to give some extra help to the girls whose families are in special difficulties.”
Umm Hiba shook her head. “It’s true that the managers here are good, that they’re helping us and not stealing the girls’ money,” she said. “But I’m so angry. Do you think we’re happy that these men from the gulf are seeing our daughters’ naked bodies?”
Most so-called casinos do not appear to directly broker arrangements between prostitutes and their customers. Zafer, a waiter at the club where Hiba works, said that the club earned money through sales of food and alcohol and that the dancers were encouraged to sit with male customers and order drinks to increase revenues.
Zafer, who spoke on condition that only his first name be used, refused to discuss specific women and girls at the club, but said that most of them did sell sexual favors. “They have an hourly rate,” he said. “And they have regular customers.”
Inexpensive Iraqi prostitutes have helped to make Syria a popular destination for sex tourists from wealthier countries in the Middle East. In the club’s parking lot, nearly half of the cars had Saudi license plates.
From Damascus it is only about six hours by car, passing through Jordan, to the Saudi border. Syria, where it is relatively easy to buy alcohol and dance with women, is popular as a low-cost weekend destination for groups of Saudi men.
And though some women of other nationalities, including Russians and Moroccans, still work as prostitutes in Damascus, Abeer, a 23-year-old from Baghdad working at the same club as Hiba, explained that the arriving Iraqis had pushed many of them out of business.
“From what I’ve seen, 70 percent to 80 percent of the girls working this business in Damascus today are Iraqis,” she said. “The rents here in Syria are too expensive for their families. If they go back to Iraq they’ll be slaughtered, and this is the only work available.”
Posted in accordance with Title 17, US Code, for noncommercail, educational pursposes.
Iraqi Women the Worse for War
Kasia Anderson / Truthdig
(May 28, 2007) — Remember those photos of Iraqi women triumphantly raising freshly inked fingers for Western cameras after voting in their new “democracy”? They were presented to the world by the US government as an indication of a policy that would liberate Iraqi women and men. Well, it didn’t quite work out that way, according to Iraqi women’s rights activist Yanar Mohammed, who argues that the situation for women in her country has significantly worsened since the American invasion in 2003.
Despite his immense failings and unforgivable atrocities, Saddam Hussein ran an essentially secular government that gave women more educational, professional and social freedoms than does the current regime. This is a source of chagrin to people like Mohammed who detested the dictatorship but fear that the future will only bring new restrictions and greater oppression for Iraq’s women under the guise of “democracy.”
On April 14, Yanar Mohammed was honored by the Feminist Majority Foundation, an organization that warned the world about what the Taliban was doing to women and girls in Afghanistan long before the US decided to take military action. As one of four special guests at the foundation’s Global Women’s Rights Awards, she was able to speak out about the many battles that she and other members of her activist group, the Organization of Women’s Freedom in Iraq, are fighting on behalf of women in their country, risking their lives on a daily basis for their cause.
Mohammed tells Kasia Anderson about her mission and explains how the current state of affairs for Iraqi women differs from the picture painted by many Western media outlets.
Kasia Anderson: Can you tell us in your own words about your work [with the Organization of Women’s Freedom in Iraq], how you started and what issues are most important to your cause right now?
Yanar Mohammed: After this war started on Iraq I immediately decided to go back to set up an organization and to be the voice for free women there, and since the beginning, in my organization, we decided to do demonstrations, to do campaigns, to make petitions, and to see whatever is needed. And it started with speaking out against the human trafficking of women, and we were the first to demonstrate. It was a few months after the [March 2003] beginning of the war — in August 2003 — we started that.
But later on, our work was mainly on sheltering women from honor killings, and also on seeking out the reports of women’s trafficking, and later on in the last two years we found out — especially after the breakout of the scandal at the Abu Ghraib prison, we found out that it is very important to have a presence in all the women’s prisons and see what’s happening there. So, we managed to become regular visitors to the central prison — it’s called Khadamiyah, a women’s prison, and we interviewed all the women in there, and we found out terrible things happening before they reached the prison.
Six of them, actually, spoke out about being assaulted, about being raped, some of them serially raped by the staff of the police station before they reached the prison. So, we decided: This is a program that we will have to pursue immediately. And the surprise here is that most of this work we do with very minimal funding — mostly depending on volunteer work.
Anderson: How did the onset of the Iraq war change things for Iraqi women, specifically? I would imagine that there would be an increase in particular forms of oppression and violence once things became more volatile and uncertain. …
Mohammed: Well, although people on this part of the world think that Iraqi women are liberated, actually, we have lost all of the achievements or all the status that we used to have. It is no longer safe to leave your house and get groceries. We’re not speaking here about a young woman trying to reach the university, because that is beginning to get too difficult. We’re not speaking here about women who are trying to go back and forth to work and even those of my friends who do that already because they have to — many of the police at work are being killed for sectarian reasons.
So, you have to witness all sorts of atrocities just going back and forth to work, and if there is this new [policy] of Sunni and Shiite, checking all the IDs of people, you leave the house and you do not guarantee that you come back safe.
Anderson: And I know that the markets are one particular target for bombers — repeated targets for bombers — when people are just trying to shop and go about their business.
Mohammed: Well, all the districts of Baghdad have witnessed bombing, and it’s like the bombings move from one neighborhood to the other every month, so … I moved my residence from one place to another, but I found out they’re all unsafe.
Anderson: What is your hope now for your organization — to move into new areas of social and political concern? Or are you going to keep building up what you’re working on now?
Mohammed: Actually, we always try to be ahead of the atrocities happening. It started with sheltering; then, it extended to the matter of the trafficking of women. The third thing is that we went into the prisons and we are watching for women’s self-esteem to be respected in there. And finally we found out that if you do not put women’s rights in context, you have done nothing.
So, we have started a youth initiative where we are inviting youth from the Sunni and the Shiite areas and making poetry events where we tell them: “The subject matter of the event is about women, is about love, is about hope,” and we are witnessing very good results — that the youth do not want to be recruited for a civil war, do not want to kill each other, but there are very few alternatives for them out there, and the few democrat, seculars and outspoken women aren’t really supported.
This is the reason that I visit L.A. and speak to our friends at the Feminist Majority Foundation and Ms. Magazine, trying to seek support so we can survive as a project and as a voice, because, surprisingly, this war on Iraq brought all the support for the fundamentalists, for the extremists, who are new in the country, who are not the original people of the country, and they made them strong against us — the women and the freedom-loving people of Iraq.
Anderson: Besides the mistaken notion that women in Iraq are enjoying more freedom now than before the beginning of the current war, which tends to be a party line over here, what other misconceptions about what’s going on in actuality in Iraq do you feel you could disabuse us of on this end?
Mohammed: Well, the myth of democracy has killed already half a million Iraqis, and if it were giving us real democracy, where people are represented according to their political affiliations or their economic understanding or their social justice affiliations, that would have been understood.
But the way Iraqis are represented is according to their religion and their ethnicities. It is as if the U.S. administration is trying to tell the whole world that Iraqis are not entitled to political understanding or political activity.
The political formula that was forwarded to us is a total insult for a part of the world where the politics are very much thriving and all kinds of politics — with the dawn of the war, thousands of political parties have registered. And they all wanted to be competing, or let’s say running into democracy, but who was empowered, who was supported? It’s mostly the religious and mostly the ethnic groups, and the women’s groups?
The U.S. administration wasn’t really interested to speak to, let’s say, free women’s groups. They preferred to bring decorative factors to the parliament, where they look like women, but they all voted for a constitution that is against women. And the constitution at this moment has imposed Shariah law upon us, when in the times before the war we had more of a secular constitution that respected women’s rights. So, it’s one more thing lost for this war.
Anderson: Can you respond to the claims made by U.S. politicians talking about how well the reconstruction efforts in Iraq are going?
Mohammed: Well, you know, the billions of dollars that we hear should have reached Iraq and been spent for the reconstruction — well, we don’t see any reconstruction. Whatever they have tried to construct, like the electricity generators and water supply and all of that — they have been blown away by the resistance over and over again, so they stopped doing those.
Anderson: Those are particular targets for the resistance?
Mohammed: Yes, yes, because they do not like to see the country run in the American way. So, the answer here is that it cannot be solved by money. There is a political issue to be solved, and later on the reconstruction follows.
We’re not saying that money should not be spent on the reconstruction, but the political issues have really stopped, and there is absolutely no communication, and all of the solutions are reaching a dead end. So, all talk of reconstruction is nonsense at this point. We have not seen any buildings reconstructed in Iraq. I wonder what they’re talking about.
Anderson: And the utilities are, at this point, shot?
Mohammed: Nothing! We get electricity one hour in the morning and one hour at night, and in the last two days there was no electricity. We did not see any new buildings built, unless they are inside the Green Zone, where we cannot see them.
Anderson: And there was a wall being constructed in April. …
Mohammed: Not one wall — there are 10 layers of concrete walls that we have to be searched over and over until we reach the Green Zone. So, maybe there is some reconstruction in there, but I’ve been there and I haven’t seen really much. So where are these billions going? I have no answer, but I think they are going somewhere else.
© 2007 Independent Media Institute. All rights reserved.
Posted in accordance with Title 17, US Code, for noncommercial, educational purposes.
May 30th, 2007 - by admin
Breitbart.com & Adam Yehiye Gadahn – 2007-05-30 23:09:23
Qaeda Warns of Attacks ‘Worse than 9/11’
(May 30, 2007) — An American member of Al-Qaeda warned in an Internet video that US President George W. Bush should withdraw all his troops from Muslim land or face attacks worse than September 11.
Adam Gadahn, a convert to Islam who has been indicted for treason by a US jury, issued a list of demands and warned they were not up for negotiation.
“Your failure to heed our demands means that you and your people… will experience things that will make you forget all about the horrors of September 11, Afghanistan and Iraq, and Virginia Tech,” he said in the video posted on Tuesday.
“You’re losing on all fronts and losing big time,” said Gadahn, who is the English-language spokesman for Osama bin Laden’s terror network.
The tape entitled “Legitimate Demands” was produced by As-Sahab, a media outfit that specialises in Al-Qaeda online material.
Gadahn — sporting a headress, glasses and long beard — said Bush had “embroiled his nation in a series of unwinable and bloody conflicts in the Islamic world.”
He also called on the United States to cease support for the “bastard state of Israel” and the “56-plus apostate regimes of the Muslim world” and to free all Muslims from its prisons.
“We don’t negotiate with war criminals and baby killers like you. No, these are legitimate demands which must be met,” he said.
Born in 1978, Gadahn — also known Azzam al-Amriki and Azzam the American — is a native of southern California and has appeared in several videotapes for Al-Qaeda since 2004.
His conversion to Islam came after he began attending the Islamic Centre of Orange County in California, where he is believed to have come under the influence of two foreign-born Islamic radicals.
Gadahn’s reference to Virginia Tech was to the shooting of 32 people at the university by Korean-born gunman Cho Seung-hui who then turned the gun on himself.
Copyright AFP 2005,
Posted in accordance with Title 17, for noncommercial, educational purposes.
• Also see: “Azzam the American” in the January 22, 2007 issue of The New Yorker.
A Message from the Mujahid Brother Adam Yehiye Gadahn (Azzam) /
Courtesy of Free Republic
A complete transcript of the 7 minute, 57 second-long videotape.
• The video can be watched or downloaded here.
(May 29, 2007) — This is not a call for negotiations. We don’t negotiate with baby killers and war criminals like you. No, these are legitimate demands which must be met
All praise is due to Allah creator of the heavens and the earth and prayers and peace be upon the messenger of Allah, and his companions, family, and followers until the day of judgement.
Bush. You thought you would be remembered by history as the President who waged a series of successful Crusades against the Muslims. Instead, you will go down in history not only as the president who embroiled his nation in a series of unwinnable and bloody conflicts in the Islamic world but as the President who sent the United States off on its death march towards breakdown and disintegration.
Oh, I’m sure there will be some partisans who believed your lies and some fanatics who shared your murderous Crusader ideology who will remember you fondly and mourn for you when this world is at long last rid of you, just as there were those who heaped praise on your fellow bloodthirsty nation destroying crusaders Milosovich and Yeltsin when they passed on to Allah’s anger but such minority sentiments can do nothing to cover up the ugliness of your crimes, the truth about your Empire of Evil, and the colossal failure of your Global Crusade.
You may or may not be aware of it but today, nearly four years after you hastily declared victory in Iraq, and more than five and a half years after you fell into the Afghanistan trap, things aren’t going too well for your Crusader Coalition. In fact, things are going really bad.
From Kanduz to Diyala, you and your mercenary hirelings and loyal but stupid allies are easy prey for our martyrdom-seekers. In East Africa, where many of the wars opening battles were fought years ago, the blood of your Ethiopian proxies is making the sand run red from Mogadishu to Ogadeen, and from the Levant, Egypt, and the Sudan to the Islamic Magrhib and Nigeria new fronts are being opened and old fronts are being reinvigorated and you and your are feeling the heat.
And, as confirmed by a new poll of Muslims in four major regional countries conducted by the Center for International Security Studies at the University of Maryland, Muslims continue to support and defend the goals, efforts, and sacrifices of their brothers and sisters, the Mujahideen and continue to demonstrate broad awareness of the evil nature of America and the threat posed by it.
This despite your worst efforts to distort out image in the eyes of Muslims and camoflauge your true intentions
In other words, you’re losing on all fronts and losing big time.
Bush, the die has been cast and the blood has been spilled and there is no way to undo what you have done.
There are, however, some steps you can take to curtail your losses and prevent the number of American casualties at home and abroad from rising even higher.
The Champions of Islam, defending their faith and brethren against your evil doing have repeatedly made clear these steps but because I know you live in a cocoon of your own making, and prefer to remain ignorant of what goes on in the world, I shall summarize them here. I strongly suggest you heed and implement them for your own good and the good of your people.
One, pull every last one of soldiers, spies, security advisors, trainers, attaches, and so on out of every Muslim land from Afghanistan to Zanzibar. Should so much as one single American soldier or spy remain on Islamic soil, it shall be considered sufficient justification for us to continue our defensive jihad against your nation and people.
Two, stop all support and aid – military, political, economic, or otherwise – to the fifty-six plus apostate regimes of the Muslim world and abandon them to their well-deserved fate at the hands of the soldiers of Islam. Should you fail to comply in full we will deem it sufficient justification to continue to fight and kill Americans.
Three, end all support, moral, military, economic, political, or otherwise to the bastard state of Israel and ban your citizens, Zionist Jews, Zionist Christians, and the rest from traveling to the occupied Palestine or settling there. Even one penny of aid will be considered sufficient justification to continue the fight .
Four, cease all interference in the religion, society, politics, and governments of the Muslim world and leave us alone to establish the Islamic Shura State which will unite the Muslims of earth in truth and justice. A single word of American protest shall be silenced by a thousand Islamic bombs.
Five, put an end to all forms of interference in the educational curricula and information media in the Islamic world and impose a blanket ban on all broadcasts to our region, especially those designed to alter or destroy the faith, minds, morals, and values of our people.
And six, free all Muslim captives from your prisons, detention facilities, and concentration camps regardless of whether they have been recipients of what you call a fair trial or not. Your refusal to release them will mean the continuation of our just struggle against your tyranny until the last kidnapped Muslim has been liberated.
This is not a call for negotiations. We don’t negotiate with baby killers and war criminals like you. No, these are legitimate demands which must be met. And your failure to heed our demands and the demands of reason means that you and your people will – Allah willing- experience things which will make you forget all about the horrors of September 11th, Afghanistan, Iraq, and Virginia Tech.
And let us be clear. A pull-out from Iraq alone in the absence of compliance with the remainder of our legitimate demands will get you nowhere and will not save you from our strikes.
SO stop wasting your time, and trying to save face with these futile, farsical maneuvers on Capitol Hill and start making some serious moves.
It’s your choice, Bush, cutting your losses and saving some face by getting out now with what you’ve still got, or continuing to coun t your dead and pursue a bloody fight to the very end. Your end, not ours.
By the grace of Allah, and with his help and power, we’ve struck back hard these past several years and with Allah’s permission we shall continue to strike back hard.
This year, next year, the year after that, and so on, until the last Crusader goes home whether waving a white flag or lying in a flag covered casket.
And our final prayer is that all Praise is due to Allah, who gives victory to the believers.
Some Comments Posted in Response
Two, stop all support and aid — military, political, economic, or otherwise — to the fifty-six plus apostate regimes of the Muslim world and abandon them to their well-deserved fate at the hands of the soldiers of Islam. Should you fail to comply in full we will deem it sufficient justification to continue to fight and kill Americans. Who are the 56+ “apostate regimes”? And maybe they should be nicer to us.
• So I’ll guess he’ll be voting democrat in ‘08?
• Read his six demands, made on behalf of Al-Qaeda. Do you still believe that anything America could do would stop terrorism except hunting and killing these lunatics?
• The 56+ apostate regimes are every single Muslim regime on the planet. None of them are legitimate in the eyes of true Islamists. Some of them considered the Taliban and the guys in Somalia okay, but that’s about it.
I liked the six demands. They will continue attacking us until each and every one is completely implemented. It does do a good job of pointing out what we would have to do to appease them.
One, pull every last one of soldiers, spies, security advisors, trainers, attaches, and so on out of every Muslim land from Afghanistan to Zanzibar. Should so much as one single American soldier or spy remain on Islamic soil, it shall be considered sufficient justification for us to continue our defensive jihad against your nation and people.
Islamic soil is considered by Islamists to include any land that ever was Muslim. This would include the Balkans to Vienna, Ukraine, Russia, Spain, Sicily and parts of southern Italy and France. Not to mention all of India.
• (I didn’t claw my way to the top of the food chain to be a vegetarian.)
• Yes, it is. Frankly, just pointing out 9/11 would suffice, but tagging VT onto the list is quite odd.
• I keep 2 magnums in my desk. One’s a gun and I keep it loaded.Other’s a bottle and it keeps me loaded.
• Not only that, complying with this demand would mean that we sever all diplomatic ties with Muslim nations or nations located on what Al-Qaeda considers Muslim soil and that we ban all American citizens from traveling to Israel or any Muslim country. As you know, any American — no matter how removed from geopolitics — is considered a spy by Muslims.
• He’s the first American to be indicted for treason since 1952. Fred ThompsonZell Miller ’08 – Give the Dems and Terrorists Hell !!!!!!!!!!
• Islamic soil is considered by Islamists to include any land that ever was Muslim. This would include the Balkans to Vienna, Ukraine, Russia, Spain, Sicily and parts of southern Italy and France. Not to mention all of India.
• Hmmm… so I guess this is war then. Wish the “apostate regimes” would start taking care of themselves, but a fifteen-minute sense of history probably makes seeing the approaching danger a little difficult.
15 posted on 05/30/2007 7:22:39 AM PDT by AnnaZ (I keep 2 magnums in my desk.One’s a gun and I keep it loaded.Other’s a bottle and it keeps me loaded)
• Are his parents liberal? If so, they must be proud.
• Do you still believe that anything America could do would stop terrorism except hunting and killing these lunatics? It’s becoming abundantly clear that it’s a fight to the finish. (Our next generation will be reading the Spanish version of the Koran.)
• “experience things which will make you forget all about the horrors of September 11th, Afghanistan, Iraq, and Virginia Tech.”
Virginia Tech? Are they taking credit for that now.
* Anyone sensing a pattern? Little attacks that go under the radar while CAIR, the ACLU, and the left opposes any attempts to link these acts together. The Islamic websites call this the “infidel harvest”.
• Read carefully this rant can be condensed to a few words: We Muslims are dangerous and irrational. We’re no different than a coon with rabies. You must do whatever it takes kill us.
• I don’t want you to misunderstand…. I’m with you… these scum need to be exterminated as quickly as possible. But, we need to find some balance between destroying the scum while reducing the US presence in the middle east and avoiding killing civilians whose families might not otherwise have been sympathetic enough to become jihadists themselves…
AQ and their imitators have decentralized and, if US intelligence is to be believed, expanded. In my opinion, the invasion of Iraq was a collosal mistake…as Scheurer wrote, it validated everything OBL had been telling the Muslim world for 10 years. Lawrence Wright who won a Pulitizer for The Looming Tower (a great read on AQ if you’ve not read it), believes that OBL badly miscalculated on 9/11…and after the invasion of Afghanistan, the world had repudiated AQ and 80% of its leadership had been killed or captured…then the invasion of Iraq reignited a nearly dead AQ jihadist movement. Now Wright believes the US needs to stay in Iraq but he also believes that AQ is happy now whether the US stays or goes…there are no good options left
I understand that the invasion of Iraq is water under the bridge and there is no point in rehashing whether or not it was the right thing to do except that I see Ron Paul routinely slammed on here for a position that I think has been vindicated by the events of the last 4 years.
Background on the Gadahns
Posted on 05/30/2007 7:30:03 AM PDT by MediaMole
WINCHESTER — It was 1988 and Michael Rowe had just moved to this dusty, one-stoplight town in rural Riverside County. Rowe bought a place southeast of here, so far out in the country that it’s reachable only by driving one-lane dirt roads.
While out walking his property one day, he met his neighbor, who lived about a mile away, and they shook hands across a barbed-wire fence.
The neighbor was tall and thin, with long hair and a beard. He said his name was Seth Gadahn and that he and his family raised goats. Rowe told Gadahn that he had moved here from Tustin because Orange County, with all its sprawling strip malls and furious freeways, was getting too crowded.
Gadahn said he, too, was originally from Orange County.
“He said, ‘I left Orange County so I wouldn’t have to deal with people, and you’re all moving out here now,’ ” Rowe recalled. “When I moved in, he thought he was being invaded.”
Sixteen years later, the fiercely private Gadahn faced an invasion of another kind. In May 2004, reporters and FBI agents found his Riverside County farm and peppered Gadahn, 57, with questions about his son, Adam Yahiye Gadahn, who they said was affiliated with al-Qaida.
Suddenly Seth Gadahn was pulled into a social spotlight he had run from 25 years before. Born Phil Pearlman, the son of a prominent Orange County doctor, Seth Gadahn turned his back on his father’s nice homes, middle-class lifestyle and traditional career.
Then, just as he had rebelled against his father, Seth Gadahn’s son rebelled against him. Adam Yahiye Gadahn became Azzam the American.
A product of the 1960s, Seth Gadahn was a peace-loving hippie who ultimately found Christianity. Completely counter to that, his son talks constantly of war and, in a Sept. 2 video, outlines the “errors” of Christianity and Judaism, the faiths of his father and grandfather.
Seth Gadahn shares many characteristics with his son – a love of obscure music, a name change to signify a fresh start, and disdain for conventional society.
But now, Adam Yahiye Gadahn, the son of a man who believed in “live and let live,” rants of death and destruction to all those who don’t convert to the violent vision of Islam created by Osama bin Laden.
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May 29th, 2007 - by admin
Hon. Dennis J. Kucknich / US House of Representatives – 2007-05-29 23:00:58
I would like to believe that this war has not been about oil. I would like to believe that there was some kind of a righteous cause connected to what we did; but I know better, and the proof is in this Hydrocarbon Act.
• Watch Dennis Kucinich on C-Span
On May 23, Congressman Dennis J. Kucinich (D-IL) Kucinich invoked a rarely used House rule of “personal privilege” to gain one hour of time in Congress for the purpose of detailing the underreported efforts of the White House and members of Congress to privatize the oil of Iraq.
“Oil was the primary reason for the invasion of Iraq,” Kucinich declared. “Iraq may have as much as 300 billion barrels of oil untapped. With oil headed toward $70 a barrel, the oil wealth of Iraq could be worth as much as $21 trillion. Nearly 3,400 sons and daughters of America have been sacrificed. As many as 1,000,000 innocent Iraqi civilians have been killed in the course of the US occupation. The taxpayers of the United States will pay between one and two trillion dollars for this war, which is based on lies.”
Kucinich has consistently challenged the rationale and conduct of Bush’s war and has “challenged my own party about its commitment to peace.” Kucinich, who is also a presidential candidate has criticized his fellow Democratic candidates for not “walking the talk” when it comes to the Occupation of Iraq. “They say they are for peace, but they vote for legislation which will privatize the oil of Iraq, thus insuring that there will be no peace. Why? Because the privatization of Iraqi oil will be rightly seen as one of the greatest acts of thievery of one nation against another.”
This special edition of EAW reposts Rep. Kucinich’s entire hour-long speech in a four-part series.
The Truth about Oil and Iraq
From the Floor of the House / Congressional Record
WASHINGTON (May 23, 2007) — Mr. Speaker, there is an issue of critical importance facing this Congress, and that issue relates to whether or not this Congress should pass legislation to continue to fund the war in Iraq.
The legislation contains a particular provision that would lead to the privatization of Iraq’s oil, a provision that I’m quite concerned about, because I think that if we take that position, it will make it very difficult for us to ever be able to end the war.
So today I’m going to lay out the case as to why this provision that’s in the bill would advance privatization and as to what the options are for this Congress.
As many know, the administration has set forth several benchmarks for the Iraqi Government, including the passage of a Hydrocarbon Law by the Iraqi Parliament. The administration has emphasized only a small part of this law, what they call the “fair distribution” (that’s in quotes) of oil revenues.
I want this House to consider the fact that this Iraqi Hydrocarbon Law contains a mere three sentences that generally discusses the so-called fair distribution of oil. Except for three scant lines, the entire 33-page Hydrocarbon Law is about creating a complex legal structure to facilitate the privatization of Iraqi oil.
As such, it is imperative that Members of Congress read the Iraqi Parliament’s bill, because passage of any legislation that includes insisting that the Iraq Government push the passage of a hydrocarbon act puts this Congress on record to promote privatizing Iraq’s oil.
Now, I have maintained from the beginning that the war has been about oil. We must not be a party to any attempt to set the stage for multinational oil companies to take over Iraq’s oil resources.
There have been several benchmarks set by the administration for the Iraqi Government, including passage of a so-called Hydrocarbon Law by the Iraqi Parliament. Many inside the Beltway are contemplating linking funding for the war in Iraq to the completion of these benchmarks, including passage of the Hydrocarbon Law by the Parliament.
This administration has led Congress into thinking that this bill is about fair distribution of oil revenues. In fact, as I mentioned earlier, except for three scant lines, the entire 33-page Hydrocarbon Law creates a structure to facilitate the privatization of Iraq oil.
Now, the war in Iraq is a stain on American history. Let us not further besmirch our Nation by participating in an outrageous exploitation of a nation [that] is in shambles due to the US intervention.
Let me provide this House with an analysis of the underlying bill in the Iraqi Legislature, which this administration is trying to get Congress to pass to pressure the Iraqi Government to accept privatization. And this analysis that I’m offering at this moment is a version that passed the Iraqi Cabinet and was referred to the Iraqi Parliament.
The legislation contains only three sentences in regards to the fair distribution of oil, but does not resolve any of the issues facing this challenge. The legislation simply requires that future legislation be submitted for approval; thus, this legislation does not even meet the benchmark of the administration.
The legislation ensures that “chief executives of important related petroleum companies,” follow that now, “chief executives of important related petroleum companies” are represented on a Federal Oil and Gas Council, which approves oil and gas contracts. This is akin to foreign oil companies approving their own contracts.
This legislation ensures that the Iraqi National Oil Company, which is the oil company of the people of Iraq, has no exclusive rights for the exploration, development, production, transportation, and marketing. The Iraq National Oil Company must compete against foreign oil companies with rules that benefit the foreign oil companies. This is for their own oil.
The legislation gives the Iraqi National Oil Company some control of developed oil fields and rights to participate in undeveloped oil fields in the Annex I and II of the legislation, but these annexes have never been made public, so we don’t know for sure.
The legislation gives the Iraq National Oil Company temporary control of the oil pipelines and export terminals, but then it directs the Federal Oil and Gas Council, which is run by chief executives of oil companies, it directs them to turn these assets over to any entity with no further instructions. The opportunity for a foreign oil company to have control over the Iraqi oil pipeline and export terminals would give that company enormous control of the Iraqi oil market.
The legislation demands that contracts, and this is a quote, “must guarantee the best level of coordination” with the Oil Ministry, Iraqi National Oil Company, the regions and oil companies. The legislation mandates that undeveloped oil fields be developed quickly, and oil companies are given explicit authority to collaborate.
The legislation does not require contracts to be published for public review for up to 2 months after approval. The legislation provides for up to 35 years of exclusive control over oil fields for foreign oil companies. The legislation provides for a preference to Iraqis for jobs and services, but only if these benefits do not place extra costs or inconveniences on the foreign oil companies.
The legislation states that disputes between the State of Iraq and any foreign investors shall be submitted for arbitration to an international court and will not be decided upon by an Iraqi court.
The Secret Annexes
This legislation has four appendices whose contents remain secret. Annex I, which is secret, regards to present producing fields allocated to the Iraqi National Oil Company; Annex II, discovered or undeveloped fields allocated to the National Iraqi Oil Company; Annex III, discovered undeveloped fields outside the operations of the Iraqi National Oil Company; and Annex IV, exploration areas. These appendices will effectively make clear which old fields will be controlled by the Iraq National Oil Company and which are open to foreign control of oil companies.
And I might add that when you look at this, out of about 98 oil fields…, the foreign oil companies will have control of about 80, 81 of those oil fields, or over 80 percent of Iraqi oil under this agreement will be controlled by foreign oil interests. This is an analysis that I’m offering based on facts that are ascertainable.
Now, what are others saying about this draft Iraqi oil law and what it will do? Here’s a quote from the Christian Science Monitor of May 18, 2007, in an article entitled “How Will Iraq Share the Oil?” In the US, the demand that Iraq pass an oil law is a benchmark that is becoming a flash point. Here’s the quote.
“The actual law has nothing to do with sharing oil revenue,” says former Iraqi Oil Minister Issam Al Chalabi, in a phone interview from Amman, Jordan. The law aims to set a framework for investment by outside oil companies, including favorable production-sharing agreements that are typically used to reward companies for taking on risk, he says.
“We know the oil is there. Geological studies have been made for decades on these oil fields; so why would we let them [that is, the international oil companies] have a share of the oil?” he adds. “Iraqis will say this is solid proof that Americans have staged the war … because of this law.”
The next quote comes from the Dow Jones Newswires of March 4, 2007, the headline: “Iraq Oil Law Details Untouched Fields, Blocks — Document.” And the text says:
“Iraq’s draft Hydrocarbon Law, the centerpiece in the development of the country’s shaky oil industry, details dozens of untouched oil fields loaded with proven reserves and scores of exploration blocks that may prove a magnet to international oil companies, according to a document seen by Dow Jones Newswires.”
In an article from the Dow Jones Newswires again, on March 10, 2007, the headline: “Some Iraqi Politicians Urge Rejection of Draft Oil Law.” Here’s the text:
“The law, if passed, is expected to open the country’s billions of barrels of proven oil reserves, the world’s third largest, to foreign investors.”
From an article from the American Lawyer, April 25, 2007, “Our Man in Iraq.” Here is the text:
“Under the new law, the Iraq National Oil Company would have exclusive control of only about 17 of Iraq’s approximately 80 known oil fields.” [So that number, then, is 17 of Iraq’s approximately 80 known oil fields.] “The law would also allow the government to negotiate different kinds of exploration and production contracts with foreign oil companies, including production-sharing agreements, or PSAs.
Energy lawyers favor these because they allow oil companies to secure long-term deals and book oil reserves as assets on their company balance sheets. Under the proposed law, foreign companies would not have to invest their earnings in Iraq, hire Iraqi workers, or partner with Iraqi companies.”
Next, from the US Morning Star Online, January 28, 2007, headlined “Iraqi Officials Insist Oil Law Won’t Favor US”
“The proposal would provide for production-sharing agreements that would give international firms 70 percent of the oil revenues to recover their initial investments and subsequently allow 20 percent of the profits without any tax or restrictions on transferring the funds abroad.”
This from CommonDreams.org, April 18, 2007, entitled “Time to Do the Math in Iraq”:
“The most notable feature of the law is a revival of exploitive type of contact widely used prior to the rise of Arab nationalism in the 1960s, known as a production sharing agreement. Although the Oil Law uses an alternative term, ‘exploration and production contract,’ the effect is identical.
“The new arrangement would allow the bulk of Iraq’s reserves to be controlled by outside oil companies, privatizing what until now has been a nationalized resource under the auspices of the Iraq National Oil Company. It specifies the royalty that will be paid to Iraq: ‘12.5 percent of gross production, measured at the entry flange to the main pipeline.’
“And as if the rest of the law were not already explicit enough, article 35(A) reiterates: ‘Holders of exploration and production rights may transfer any net profits from petroleum operations to outside Iraq after paying taxes and fees owed.'”
This, from a publication called PLATFORM in 2005, entitled “Crude Designs: The Rip-Off of Iraq’s Oil Wealth,” by Greg Muttitt:
“At an oil price of $40 per barrel,” and keep in mind that the price of oil is about $65 a barrel right now, heading towards $70 a barrel, but at a “price of $40 a barrel, Iraq stands to lose between $74 billion and $194 billion over the lifetime of the proposed contracts.
“Under the likely terms of the contracts, oil company rates of returns from investing in Iraq would range from 42 to 162 percent, far in excess of the usual industry minimum target of around 12 percent return on investments.”
Continue to Part 2….
May 29th, 2007 - by admin
Hon. Dennis J. Kucknich / US House of Representatives – 2007-05-29 23:00:37
Now, I have stated many times on this floor that I believe that the war against Iraq was about oil. Now let me provide you with some quotes that may reflect on my thinking on this.
Mr. Dick Cheney, CEO of Halliburton, in a speech at the Institute of Petroleum in 1999, said:
“By 2010, we will need on the order of an additional 50 million barrels a day. So where is the oil going to come from? Governments and national oil companies are obviously controlling about 90 percent of the assets. Oil remains fundamentally a government business. While many regions of the world offer great oil opportunities, the Middle East, with two-thirds of the world’s oil and lowest cost, is still where the prize ultimately lies. Even though companies are anxious for greater access there, progress continues to be slow.”
In an article from Platform, November 2005, called “Crude Designs: The Rip-Off of Iraq’s Oil Wealth.” Chapter 4, “Planning Iraq’s Oil Future. Pre-invasion Planning.” And when you listen to this, it’s pretty astonishing to see how all these facts have been available for people to be able to gain, and perhaps only now, people are reflecting on the real meaning of this.
This is what Greg Muttitt writes:
“Prior to the 2003 invasion, the principal vehicle for planning the new postwar Iraq was the US State Department’s Future of Iraq project. This initiative, commencing as early as April 2002, involved meetings in Washington and London of 17 working groups, each composed of 10 to 20 Iraqi exiles and international experts selected by the State Department.
“The ‘Oil and Energy’ working group met four times between December 2002 and April 2003. Although full membership of the group has never been revealed, it is known that Ibrahim Bahr al-Uloum, the current Iraqi Oil Minister, was a member. The 15-strong oil working group concluded that Iraq ‘should be opened to international oil companies as quickly as possible after the war,’ and that, ‘the country should establish a conducive business environment to attract investment of oil and gas resources.’
“The subgroup went on to recommend production-sharing agreements as their favorite model for attracting foreign investment. Comments by the handpicked participants revealed that ‘many of the group favored production-sharing agreements with oil companies.’ Another representative commented, ‘Everybody keeps coming back to production-sharing agreements.’
“The reasons for this choice were explained in the formal policy recommendations of the working group, published in April 2003.”
And I quote from this article from Platform:
“Key attractions of production-sharing agreements to private oil companies are that, although the reserves are owned by the state, accounting procedures permit the companies to book the reserves in their accounts; but, other things being equal, the important feature from the perspective of private oil companies is that the government intake is defined in terms of the production-sharing agreement, and the oil companies are therefore protected under a production-sharing agreement from future adverse legislation,” which means it would be very tough to be able to have a government, once it gives up its oil wealth, to be able to get it back.
“The group also made it clear that in order to maximize investments, the specific terms of the production-sharing agreements should be favorable to foreign investors: ‘PSAs can induce many billions of dollars of direct foreign investment in Iraq, but only with the right terms, conditions, regulatory framework laws, oil industry structure, and perceived attitude toward foreign participation.’
“Recognizing the importance of this announcement, The Financial Times noted: ‘Production-sharing deals allow oil companies a favorable profit margin and, unlike royalty schemes, insulates them from losses incurred when the oil price drops. For years, big oil companies have been fighting for such agreements, without success, in countries such as Kuwait and Saudi Arabia.’
“The article concluded that: ‘The move could spell a windfall for big oil companies such as ExxonMobil, Royal Dutch/Shell, BP, and TotalFinaElf.'”
Now, this article goes on to talk about what has been done to try to shape the new Iraq with respect to oil.
“The US and the UK have worked hard to ensure that the future path for oil development chosen by the first elected Iraqi Government will closely match their interests. So far, it appears they have been highly successful. Production-sharing agreements, which were first proposed by the US State Department group, have emerged as the model of oil development favored by the post-invasion phases of Iraqi Government.
“Phase one: Coalition Provisional Authority and Iraqi Governing Council. During the first 14 months following the invasion, occupation forces had direct control of Iraq through the Coalition Provisional Authority. Stopping short of privatizing oil itself, this Coalition Provisional Authority began setting up a framework for a longer-term oil policy.
“The Coalition Provisional Authority appointed former senior executives from oil companies to begin this process. The first advisers were appointed in January 2003, before the invasion even started, and they were stationed in Kuwait, ready to move in. First, there were Phillip Carroll, formerly of Shell, and Gary Vogler of ExxonMobil, backed up by three employees of the US Department of Energy and one of the Australian Government.
“Carroll described his role as not only to address short-term fuel needs and the initial repair of production facilities, but also, ‘begin planning for the restructuring of the Ministry of Oil to improve its efficiency and effectiveness.’ Another point: ‘Begin thinking through Iraq’s strategy options for significantly increasing its production capacity.’
“In October 2003, Carroll and Vogler were replaced by Rob McKee of ConocoPhillips and Terry Adams of BP, and finally in 2004, by Mike Stinson of ConocoPhillips and Bob Morgan of BP. The £147,000 cost of two British advisers, Adams and Morgan, was met by the UK Government. Following the handover to the Iraq Interim Government in June 2004, Stinson became an adviser to the US Embassy in Baghdad.”
Again, from Platform, on the 13th of July, 2003:
“In the first move towards Iraqi self-government, the Coalition Provisional Authority’s Administrator Paul Bremer appointed the quasi-autonomous, but virtually powerless, Iraqi Governing Council. On the same day Mr. Bremer appointed Ibrahim Bahr al-Uloum, who had been a member of the US State Department oil working group, as Minister for Oil.”
Within months of his appointment, Bahr al-Uloum announced he was preparing plans for the privatization of Iraq’s oil sector, but that no decision would be taken until after the election scheduled for 2005. Speaking to the Financial Times, Bahr al-Uloum, a US-trained petroleum engineer, said the Iraqi oil sector needs privatization, but it is a cultural issue, noting the difficulty of persuading the Iraqi people of any such policy. He then proceeded to announce that he personally supported production-sharing agreements for upstream development, giving priority to US oil companies and European companies, probably.
The Role of the Coalition Provisional Authority
The second phase, the Iraq interim government. In June 2004, the Coalition Provisional Authority handed over Iraq’s sovereignty to an interim government headed by Prime Minister Allawi.
The position of Minister of Oil was handed to Thamir al-Ghadban, a UK-trained petroleum engineer and former senior adviser to Bahr al-Uloum. In an interview in Shell Oil Company’s in-house magazine, al-Ghadban announced that 2005 would be the “year of dialogue” with multinational oil companies.”
“About 3 months after taking power, Allawi issued a set of guidelines to the Supreme Council for Oil Policy from which the Council was to develop a full petroleum policy. Preempting both the Iraqi elections and drafting of a new constitution, Allawi’s guidelines specified that while Iraq’s currently producing fields should be developed by the Iraq National Oil Company, all other fields should be developed by private companies, through the contractual mechanism of production-sharing agreements.
“Iraq has about 80 known oil fields, only 17 of which are currently in production. Thus the Allawi guidelines would grant the other 63 to private oil companies.”
The third phase, the transitional government and writing the constitution: “The interim government was replaced in 2005 by the election of Iraq’s new National Assembly, which led to the formation of the new government with Ibrahim al-Ja’afari as Prime Minister. In a move which no doubt assisted policy continuity from the period of US control, Ibrihim Bahr al-Uloum was reappointed to the position of Minister for Oil.
“Meanwhile, Ahmad Chalabi, the Pentagon’s former favorite to run Iraq, was appointed chair of the Energy Council, which replaced the Supreme Council for Oil Policy as the key overseer of energy and oil policy. Back in 2002, Chalabi had famously promised that ‘US companies will have a big shot at Iraqi oil.’
“By June 2005, government sources reported that a Petroleum Law had been drafted, ready to be enacted after the December elections. According to sources, although some details are still being debated, the draft of the Law specifies that while Iraq’s currently producing fields should be developed by Iraqi National Oil Company, new fields should be developed by private companies.”
Now, this again comes from a Foreign Policy in Focus article [entitled] “When It Comes to Oil, the US Administration is Bypassing Democracy in Iraq.”
An article, “Oil Pressure,” by Greg Muttitt (August 28, 2006) goes on to say:
“Since the new Iraqi Government was formed in 2006, the US Government has dramatically scaled up its efforts to provide ‘advice.’ Last month, the administration and major oil companies reviewed and commented on the new law governing Iraq’s crucial oil sector before it had even been seen by the Iraqi Parliament.
“Violating the very notions of freedom and democracy” the administration invokes in nearly every speech, “the US Government has actively intervened in the restructuring of Iraq’s oil industry since at least 2002.
“In December 2002, the State Department established a working group on oil and energy as part of its ‘Future of Iraq’ project. The project brought together influential exiled Iraqis with US Government officials and international consultants. Later, some members of the group became part of the Iraqi Government. The result of the project’s work was a draft framework for Iraq’s oil policy.
“Despite Iraq being rich in oil and technical expertise, the group recommended a major role for foreign companies through long-term contracts, an approach that would set Iraq at odds with the rest of the Middle East where major oil producers keep their oil in the public sector.
“In March 2003, the wheels started to turn as the Coalition Provisional Authority appointed the former head of Shell USA as a senior oil adviser, in direct contact with the Iraq Ministry of Oil. He was joined by an executive from ExxonMobil, and after 6 months, the post was rotated to former managers of ConocoPhillips and BP.
“In December 2003, the framework was set out in more detail when USAID commissioned a report by the privatization specialists BearingPoint,” is the name of the company, entitled ‘Options for Developing a Sustainable Long-Term Iraqi Oil Industry.’ The report reinforced the ‘Future of Iraq’s’ report, recommending long-term contracts with foreign companies.
“Pointing to the success, as they call it, of this model, BearingPoint used Azerbaijan’s privatization model as an example. The report commented approvingly that Azerbaijan’s high corruption and lack of democracy had not impeded investment; the government had simply given away a higher share of revenues in order to attract companies. The implication was that Iraq, which has a nascent democracy and chronic corruption, might follow the same approach.
“After the handover to the interim government in June 2004, senior oil advisers, now based within the Iraq Reconstruction Management Office in the US Embassy worked closely with the Iraq Oil Ministry in shaping policy. Post holders included executives from ChevronTexaco and Unocal.
“In 2006, these efforts intensified….
Continue to Part 4….
May 29th, 2007 - by admin
Hon. Dennis J. Kucknich / US House of Representatives – 2007-05-29 22:59:58
“In February, the Iraq Reconstruction Management Office advisers accompanied eight senior officials from the Oil Ministry on a trip to the US, sponsored by the US Trade and Development Agency. On the trip, they met oil company representatives to discuss the future structure of the Iraq oil industry.
“The same month, at the request of the State Department, USAID provided an adviser to the Oil Ministry, again from BearingPoint,” the privatization specialist, “to work directly on a new oil law providing ‘legal and regulatory advice and drafting the framework of petroleum and other energy-related legislation, including foreign investment.'”
“The US campaign on the fledgling Iraqi Government has been successful. Following his appointment in May, new Oil Minister Husayn al-Shahristani announced that one of his top priorities would be writing of an oil law to allow Iraq to sign contracts with ‘the largest companies.'”
“This would be the first time in more than 30 years that foreign companies would receive a major stake in Iraq’s oil. Oil was brought into public ownership and control in Iraq in 1975.
“With the ink not yet on the paper, the US has maintained its pressure. On his visit to Baghdad in 2006, [the US Energy Secretary] insisted that the Iraqi government must ‘pass a hydrocarbon law under which foreign companies can invest.’ But the work to make this case had already been done: ‘We got every indication they were willing and also felt a necessity to open up this sector,’ he commented after a meeting with the Oil Minister and Iraqi officials.”
The Energy Secretary did not stop at reviewing the draft law himself in Baghdad. He also arranged for Dr. Al-Shahristani, the new Oil Minister, to meet with nine major oil companies, including Shell, BP, ExxonMobil, ChevronTexaco and ConocoPhillips, for them to comment on the draft as well, during the Minister’s trip to Washington, DC the following week.
“Given the pressures involved, perhaps the Minister felt he did not have much choice. His promise to pass the law through Parliament by the end of 2006 was set in Iraq’s agreement with the International Monetary Fund last December. According to that agreement, IMF officials would also review and comment on a draft in September.
“And still, the draft law had not been seen by the Iraqi Parliament. Meanwhile, an official from the Oil Ministry had stated that Iraqi civil society and the general public will not be consulted at all.
“These issues could hardly be more important for Iraq. Oil accounts for more than 90 percent of government revenue, is the main driver of Iraq’s economy. And decisions made in the coming months will not be reversible–once contracts are signed, they will have a major bearing on Iraq’s economy and politics for decades to come.”
There is much that has been written. An article in the Associated Press on March 13, 2007, about how Iraqi leaders fear ouster over oil money: “Continued White House support for Iraq depended on positive action and all the benchmarks, especially the oil law and sectarian reconciliation, by the close of this parliamentary session, June 30.”
In an article in the Los Angeles Times, May 13, 2007: “Iraqis resist US pressure to enact oil law. Foreign investment and Shiite control are primary concerns.” Here is a quote:
“I did make it clear that we believe it is very important to move on the issues before us in a timely fashion and any undue delay would be difficult to explain.”
That is a quote from Vice President Cheney, who recently visited Iraq to urge the passage of the Hydrocarbon Act, among other matters.
“The US Energy Secretary calls on Iraq to open up its oil sector to foreign investment.” This is an article from July 21, 2006, saying that US Energy Secretary Samuel Bodman has urged Iraq to establish a legal framework that would be instrumental in attracting foreign investment.
Other articles. From a Department of Energy press release, July 26, 2006: “Secretary Bodman hosts Iraqi Ministers of Oil and Electricity. Energy leaders sign memorandum of understanding to further promote electricity cooperation.”
From Agence France-Presse: “US wants new Iraq oil law so foreign firms can take part.” July 18, 2006. “The United States on Tuesday urged Iraq to adopt a new hydrocarbon law that would enable US and other foreign companies to invest in the war-torn country’s oil sector.”
.Bush’s Exit Strategy:
‘Privatize Your Oil or We’ll Withdraw our Troops’
We all know that the Iraq Study Group, in one of its major recommendations, Recommendation 63, said the United States should encourage investment in Iraq’s oil sector by the international community and international energy companies; that the United States should assist Iraqi leaders to reorganize the national oil industry as a commercial enterprise; that the United States should ensure the World Bank’s efforts to assure that best practices are used in contracting.
Mr. Speaker, the last 50 minutes that I have spent talking about the effort to try to privatize Iraq’s oil, if you go to one of the search engines, you can find perhaps 1 million different citations relating to this. So it is impossible to cover this kind of a subject, even in a period of an hour. But it needs to be said that this administration has pushed the Congress to put language in funding bills for Iraq that would set the stage for the privatization of Iraq’s oil.
I am going to quote from the first war supplemental, that “the President shall make and transmit to Congress a determination, No. 2, whether the Government of Iraq is making substantial progress in meeting its commitment to pursue reconciliation initiatives, including enactment of a hydrocarbon law.” Then under subsection (b), it says “if the President fails to make this determination, the Secretary of Defense shall commence the redeployment of our Armed Forces from Iraq.”
In other words, privatize your oil, or we are leaving you without having a security and peacekeeping force to replace the United States Army.
The Supplementals and the Hydrocarbon Act
In the second supplemental, the administration language promoted the President transmitting to Congress a report in classified and unclassified form, article 2, whether the Government of Iraq has enacted a broadly accepted Hydrocarbon Law that equitably shares revenues among all Iraqis.
Now again, they don’t talk about what the real purpose of the Hydrocarbon Act has been. It is not about sharing revenues equitably; it is about a complex restructuring of Iraq’s oil industry for the purpose of turning Iraq’s oil over to private oil companies.
Finally, in the third supplemental that is before this Congress this week, there is an article from the Senate side that relates to Iraq oil, and I quote: “The United States strategy in Iraq shall hereafter be conditioned on the Iraqi Government meeting certain benchmarks.” And one such benchmark, “enacting and implementing legislation to ensure the equitable distribution of hydrocarbon resources of the people of Iraq.” And it goes on to pay homage to the issues of equity and ethnicity.
Madam Speaker, it is clear that the people of Iraq are under enormous pressure to give up control of their oil.
When you consider that there was no cause to go to war against Iraq, that Iraq did not have weapons of mass destruction, that Iraq had nothing to do with 9/11, that Iraq had nothing to do with al Qaeda’s role in 9/11, that the administration kept changing the reason why we went into Iraq, and here we are, years later, we are still in Iraq, and enormous pressure is being put on the Iraqi Government to privatize their oil.
An Exit Strategy that would Benefit All Parties
I am here to say that there is another path that can be taken, and that path is part of H.R. 1234, a bill that I have written that would enable the war to end by Congress determining that no more money will go for this war, telling the administration that it must open up diplomatic relations with Syria and Iran, and moving in a direction where we put together an international peacekeeping and security force that would move in as our troops leave. And then we set the stage for real reconciliation that cannot come with the US serving as an occupying army.
We have a moral responsibility to the Iraqi people whose country we have ravaged with war to the tune of hundreds of billions of dollars of damage, whose people may have experienced the loss of perhaps as many as a million Iraqis during this conflict — innocent people, whose social bonds have been torn asunder.
We have a moral responsibility to work to bring about a program of reconciliation between the Sunnis, Shiites and the Kurds which can only come when we end the occupation.
We have a moral responsibility to bring about an honest reconstruction program, absent the US contractors who have been gouging the Iraqi people, and gouging the American taxpayers as well, but we have to make sure that the Iraqi people have control of their oil.
I would like to believe that this war has not been about oil. I would like to believe that there was some kind of a righteous cause connected to what we did; but I know better, and the proof is in this Hydrocarbon Act.
This Congress has an opportunity to finally take a stand and reject this Hydrocarbon Act. We can strip out this provision forcing Iraq to privatize its oil. We can strip that out of the legislation. Or we can simply defeat the legislation because that is in there, and then go back to the boards and tell the President, look, Mr. President, we are not going to give you any more money for this war, which is what I believe we should do.
Tell the President: “This war is over, Mr. President, and use the money that is in the pipeline to bring the troops home.”
Let’s go and reach out to the international community. With the end of the occupation and the closing of bases, we will have people who will start listening to us internationally, and we will have some credibility.
But the morality [that] this country rests on — our heart and soul of who we are as Americans — is not reflected by this obscene attempt to steal the oil resources of Iraq.
That is why I have chosen to take this time to come before the Congress, to lay these facts out for Members of Congress and for the American people so that you can see without question the relationship between war and this oil and the relationship between the pressure that is being put on the Iraq Government right now and privatization and the continuation of the war.
Let’s end this war. Let’s end the attempt to control Iraq’s oil. Let’s challenge the oil companies in this country as this House has done this morning. Let’s take a stand for truth and justice. Let’s take a stand for what is right.
Let us not be seduced by this idea that somehow we have the military might, and we can, therefore, grab other people’s resources. That is not what America is about.
America has a higher calling in the world. It is time we began a process of truth and reconciliation in our own country, in reaching out and creating the healing of America. But we must first begin with the truth, and the truth is what I have told this Congress today.
Madam Speaker, thank you.
Members of Congress, thank you.
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