Iraq Oil Report

The U.S. State Department said oil companies who sign deals in Iraq with the Kurdistan Regional Government are taking a risk, and this is what they tell companies who contact them.

When queried about the Hunt Oil deal signed with the KRG earlier this month, a state department spokesman said he was “not sure how much contact” Hunt had with the U.S. government prior to the signing, but that it hurts efforts at reconciliation and a national oil law.

Read the story from today’s press briefing HERE.

The KRG, relatively autonomous for 15 years, with its own security force, secure borders and economic development, it sets itself apart from the rest of Iraq.

But Baghdad insists any oil sector development must wait until a federal law is in place to govern not only the extent of foreign investment, but the role to be shared between the federal/regional/provincial governments.

The KRG, impatient and ready to continue to move forward, has been signing deals with private oil companies, which Oil Minister Shahristani has called illegal. He rephrased that, however, and said all of the deals the KRG signed prior to February, when a federal oil law was originally agreed upon, would be OK as long as they are retuned, if necessary, to comply with the federal law.

But Shahristani said the Hunt Oil deal was “illegal” no matter what, sparking a back-and-forth with the KRG that looks to remain ugly and not go away any time soon.

Simon Webb reports for Reuters the KRG said such moves by Shahristani are counterproductive.

“The Hunt contract was signed…according to the enacted regional law based on the federal constitution. There is no question about the legality of that or any other deal,” KRG government spokesman Khaled Salih said in a statement sent to Reuters by e-mail.

More Iraq Oil

The long awaited shipment of oil from Kirkuk has made it to Jordan. It’s the first of many more tankers to trek the dangerous road to the Jordanian border at market price minus $22 per barrel.

Any takers on Kirkuk crude? Head to Ceyhan. A tender for 5 million barrels was announced.

Iraq’s oil unions have issued a vaguely worded – or vaguely interpreted – statement saying rogue writers are working on behalf of their enemies to discredit them. The unions, while supported both by the masses and many politicos, have wielded their power and threats to shut down the oil sector if their workers’ rights demands aren’t met. Oh, and they also say the current draft of the oil law is a no-go if certain contracts giving too much rights to foreign/private oil companies are allowed.
The unions are accused of being partisans, a factually inaccurate claim which the leadership in Baghdad uses to delegitimize the unions.

Society, Security and Politics

Rep. Alcee Hastings has sponsored a bill giving special immigration status to Iraqi refugees. The U.S. has let in less than 1,500 displaced Iraqis since the war began while Syria and Jordan have combined to give shelter to more than 2 million.

Security in Diyala province is tense as former Sunni insurgents who pledged to join the federal Iraqi security forces have been refused.

The Biden Bill Flap

Sen. Joseph Biden’s decentralize Iraq bill has caused a stark reaction from Iraqi political leaders. The amendment to the 2008 defense funds bill was widely passed. It calls for U.S. support of weak-center federalism in Iraq, splitting the country by (not-so-fine) Shiite, Sunni and Kurdish lines.

The Kurdistan Regional Government was the first to opine:

The people of Kurdistan, who have struggled for decades to achieve democracy and freedom, see in federalism the promise of stability and freedom from dictatorial regimes. We welcome this significant resolution in support of federalism, which guarantees the survival of Iraq on the basis of voluntary union.

But Sunnis widely reject anything but a strong Baghdad-run Iraq. IraqSlogger posts the full version of Vice President Tariq al-Hashimi’s “national contract” for Iraq, which the leader of the Sunni Iraqi Islamic Party got Shiite Grand Ayatollah Ali al-Sistani to sign onto.

Al Sharqiya TV reports the Fadhilla, Sadr Movement, Tawafuq and National Dialogue Front political blocs have all rejected Biden’s bill.

And yesterday the Biden plan was condemned by Prime Minister Nouri al-Maliki, a Shiite.

Friday afternoon, Iraq’s Ambassador to the United States Samir Sumaida’ie issued the following statement:

The Iraqi people share more than their identity born of the legacy of their ancestors and the long history of their land; they share marriages and families, homes and neighborhoods, schools and hospitals. These unions, in addition to their Iraqi identity, bind them together. Despite the strains imposed by terrorists and extremists, their collective will is to stay united. That will is clearly expressed by the Iraqi constitution which stipulates a united, free, democratic and federal Iraq.

The non-binding resolution passed by the Senate on Wednesday, September 26th implicitly calling for the partitioning of Iraq into three separate entities along ethnic and sectarian lines, will not help to preserve Iraq; rather, it could lead to the break up of Iraq.

It is not a solution; it could complicate rather than simplify a difficult situation. The Iraqi people will not accept sectarian partitioning. Al Qaeda and other extremists must not be given such a victory, when together the multi-national forces, Iraqi Security Forces and the Iraqi people at large, have been making steady gains against them, and beginning to resolve their political differences.

Sectarian violence is a passing problem in Iraq as it was in other countries. It does not follow that the only solution for it is separation. A federal structure not withstanding, pushing for sectarian separation in Iraq at this juncture would encourage the spread of instability, violence and terrorism throughout the entire region. This would not only be detrimental to the interests of its peoples, but also to the interests of the United States.

The shape of a future Iraq will be determined solely by Iraqis themselves. Only they will decide on the finalization and interpretation of their constitution. The contributions made by the United States Congress and the American people are invaluable, and their sacrifices greatly appreciated. However, Congress must not be seen to undermine the will of the very people it helped to empower.

This resolution will not hasten the day American troops come home, which is a goal shared by Iraqis and Americans. If actively pursued, partitioning will do just the opposite.