Key members of Iraq’s Parliament, including the chairman of the Oil & Gas Committee, have issued a statement outlining concerns over the efforts of Iraq’s Oil Ministry and Shell to create a joint venture for natural gas, Ahmed Rasheed reports for Reuters.

Sticking points include the no bidding process, a potential virtual monopoly on Iraq’s southern gas and beyond, and the lack of involvement of Parliament and the local governments affected by the deal.

The Oil Ministry says all of the details will be negotiated in the coming year, and assures Parliament their concerns will be addressed. The committee has asked for a “public hearing” with the minister.

For background read UPI’s Ben Lando and Alaa Majeed:

Shell-Iraq gas company is a monopoly, secret agreement shows

Shell secures 25-year access to Iraq’s oil, gas

Gas deal no monopoly, Shell and Iraq say

There appears to be confusion over the results of Monday’s meeting between Iraq Oil Minister Hussain al-Shahristani and Kurdistan Regional Government Prime Minister Nechirvan Barzani and Natural Resources Minister Ashti Hawrami. Both sides said there was an agreement reached about exporting oil from the KRG’s Tawke and Taq Taq fields, which was confirmed to UPI’s Ben Lando by one of the operators of the fields.

But in an article by Sinan Salaheddin for The Associated Press has Hawrami predicting 100,000 barrels per day in KRG exports by next year, whereas the Baghdad Oil Ministry spokesperson Assem Jihad said “the export license has not yet been granted.”

Both are correct: Tawke and Taq Taq production has been hampered by politics, not technical capability, and could ramp up investment and then output in short order, and the 100,000 bpd target is realistic. That is, however, if the KRG and Iraq national government agree on key issues.

The KRG and Baghdad disagree over the KRG’s rights to independently sign exploration and development deals for oil and gas in its territory. The deals for Tawke and Taq Taq were signed prior to a February 2007 red line Shahristani has drawn; nearly all of the two dozen others were not.

Both sides have said in the past the technical aspect can be resolved and is not political. But two issues remain to be solved: 1. How this applies to the other KRG deals if they start producing oil and 2. Who controls – and monitors – how the oil flows from the fields to the export line, metering station and into Turkey, and exactly how and where the revenue is collected and distributed.

Two interesting snippets from a press release issued by the KRG:

When asked about a national oil law, Mr al-Shahristani said, “The Iraqi Council of Representatives has been unable to pass a national oil and gas law because of a lack of consensus among the political parties.” He later added, “The February 2007 draft law will be a good base for a hydrocarbon law in Iraq which will benefit Iraqis across the country.”

Mr Barzani and Mr al-Shahristani announced that both sides would prepare for the future joining of two oilfields, Tawke and Taqtaq in the Kurdistan Region, to the main northern export pipeline to the Turkish port of Ceyhan. They stated however that further talks would be needed before national export licenses would be assigned to the fields.

The Kurdish separatist group PKK has claimed responsibility for bombing the Turkish side of the oil pipeline linking Iraq’s northern oil fields to the Ceyhan, Turkey, export hub. It’s not the first time the PKK has targeted Turkey’s energy sector, but it is the first time the group has set ablaze Iraq’s oil, UPI’s Ben Lando reports.

Iraq’s government will now have to take more seriously Turkey’s complaints, but it’s up to Turkey to address the root cause of the PKK’s popularity and motivation. …

“It was extraordinarily effective,” said Gareth Jenkins, a PKK expert at The Jamestown Foundation who has lived in Turkey for nearly 20 years. “I don’t know why PKK hasn’t attacked energy infrastructure more.”

The latest attack came days before Iraqi Oil Minister Hussain al-Shahristani and leaders of the Kurdistan Regional Government of Iraq set aside protracted disputes over the draft Iraqi oil law and the oil deals the KRG has signed. During their meetings Monday in the KRG capital, Erbil, the two announced that oil from two of the KRG deals — with Norway’s DNO and the joint venture with Turkey’s Genel Enerji and Canada’s Addax Petroleum — would be allowed to be exported.

The oil will be piped into the Kirkuk-Ceyhan pipeline and sent to Turkey.

“Given that PKK is hitting Turkey out of bases on the Qandil Mountain in the KRG, hitting the Kirkuk-Ceyhan pipeline, if it starts carrying KRG oil, might prove self-defeating,” said Samuel Ciszuk, Middle East analyst for IHS Global Insight. …

According to an expert in threats and vulnerabilities to the energy sector worldwide who speaks to United Press International on condition of anonymity, there have been more than “164 PKK attacks, attempted attacks or suspected PKK attacks on energy infrastructure in Turkey since 1989.” …

SOFA UPDATE

Iraq’s Parliament is scheduling Thursday to vote on the U.S.-Iraq troop pact, as political factions fearing minority powers will be curbed or Iraq sovereignty at risk. Adam Ashton reports for McClatchy Newspapers a “companion measure” aimed at satisfying opponents to the Status Of Forces Agreement is being drafted as well, and could include a national referendum to make the pact legal.

The U.N. mandate, which has been extended before, expires at the end of this year. It provides international legal cover for the occupation, as well as guarantees Iraq’s oil money won’t be frozen by unpaid creditors of Saddam Hussein, a major worry of some politicians James Glanz and Steven Lee Myers report for The New York Times.

Iraq’s U.N. Ambassador Hamid al-Bayati assured UPI’s Ben Lando either a U.N. or U.S. based guarantee of the funds will be in place.

The SOFA is only the main framework document for U.S. forces in the country. Accompanying it is a “Strategic Framework” which details cooperation in economic and other sectors.

Iraq Oil Report follows up on its exclusive first publication of the full SOFA with the release of the The Strategic Framework for the Relationship of Friendship and Cooperation Between Iraq and the U.S.

Section V: cooperation in the fields of economy and energy

The building of a prosperous and diversified economy and growing in Iraq, and integrated into the global economic system, capable of providing basic services to the Iraqi people and welcomed the return of Iraqi citizens living outside the country at the present time will require unprecedented capital investment in reconstruction and development of Iraq’s natural resources and human characteristics, And the integration of Iraq into the global economy and its institutions. To this end, the parties agree to cooperate in order:

7. Facilitate the flow of direct investment to Iraq to contribute to the reconstruction and development of its economy.

8. Encourage the development of the sectors of electricity, oil and gas in Iraq, including the rehabilitation of facilities and vital institutions and the strengthening of Iraqi capabilities and rehabilitation.

“The Status of Forces Agreement and the wider Strategic Framework Agreement accompanying it are the latest in a long line of treaties, pacts and agreements negotiated by successive Iraqi governments with powerful western nations dating back to just after the First World War,” Stephen Farrell writes for The New York Times.

“Few of these treaties produced terms that satisfied domestic Iraqi nationalists. At least one — in 1948 — ended with riots and the forced resignation of Iraq’s first Shiite prime minister. That fact was unlikely to have been lost on Prime Minister Nuri Kamal al-Maliki’s own, Shiite-led, government.
We have collected contemporary reports from The New York Times of some of those previous negotiations. The echoes of today’s headlines are uncanny.”

Iraq’s Oil and the Future, a conversation between former Iraq Oil Minister Issam Chalabi and Professor Kjell Aleklett at Stockholm University.

A visit to India by Turkey’s energy minister furthered a proposed oil pipeline that would send Iraq oil and others’ to Israel, India and eastward, Platts reports.

More on the visit by Saban Kardas in the Eurasia Daily Monitor.

Iraq has approved a $144 million contract with Argentina’s Tenaris Oil Field Services, Reuters reports. The pipes will be used in drilling 100 new oil wells, government spokesman Ali al-Dabbagh said in a statement.

The Iraqi Ministry of Oil is planning to build a new oil refinery in Missan province at a cost of $4 million U.S. dollars, Voices of Iraq reports.

Read what Iraqis read: the Iraq Press Roundup by UPI’s Alaa Majeed.

Basra’s development authority on Wednesday held a conference during which it revealed its strategic plan for the province for 2009.“The plan has been outlined to experts, who are expected to discuss them and give their opinions on the matter,” the chairman of the authority, Munadel Khanjar, told Voices of Iraq.

Hollywood heavyweights traded Beverly Hills for the hills of northern Iraq to take stock of the region’s potential film industry, USA Today’s Charles Levinson reports. The delegation from Hollywood was whisked around Kurdistan in armored Land Cruisers by bodyguards wearing business suits and earpieces.
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Two companies developing oil fields in Iraq’s Kurdistan region received approval from Baghdad to tie in to the northern Iraq pipeline, a company official said.

An official from the Taq Taq Operating Co., TTOPCO, a joint venture between Turkey’s Genel Enerji and Canada’s Addax Petroleum, said on condition of anonymity that both TTOPCO and Norway’s DNO were given tie-in permission, Ben Lando reports for United Press International.

News reports from Erbil, the Kurdistan Regional Government’s capital, said a visit Monday by Iraqi Oil Minister Hussain al-Shahristani paved the way to proceed with the technical work. Iraq exported an average 319,000 barrels per day through the northern pipeline last month. It hit a high of 483,000 in June, and the combined initial addition of TTOPCO and DNO exports could add anywhere between 60,000 to 100,000 bpd depending on technical issues with their respective oil fields and infrastructure.

“Concerning this issue, we have agreed to prepare and link the pipeline (from both fields) to the Iraqi strategic pipeline, but regarding the exporting process there are still some unresolved points which will be discussed … in coming days,” Shamal Aqrawi of Reuters reports Shahristani as saying.

The Associated Press reports there were no decisions made about the disputed two-dozen other contracts signed by the KRG, but Nechirvan Barzani and Shahristani agreed to further talks.

They also will cooperate on Khurmala, part of the Kirkuk structure, which saw national and regional security forces standoff over it during the summer.

Iraq’s Oil Ministry made good on a pledge last month to turn around a four-month decline in oil exports as Iraqi oil starts fetching less than $60 a barrel.

New data from the ministry show Iraqi oil exports increased by more than 7 percent from September through October, which averaged 1.7 million barrels per day, Ben Lando reports for UPI. Exports slightly dropped in the north, from 320,000 bpd in September to 319,354 last month. But southern exports made up for the difference and then some, from 1.32 million bpd in September to October’s 1.38 million bpd.

Iraq’s Central Bank adviser says reserves are at $42 billion, according to the Iraq Development Program.

The University of Baghdad and the Iraqi AlAmal Association have released their new study: Results of the Field Survey for Needs and Opinions of the Poor in Iraq.
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Iraq Prime Minister Nouri al-Maliki has blasted the Kurdistan Regional Government for what he calls “constitutional violations.” In a press conference he listed them – including developing foreign relations and utilizing Peshmerga forces against national Iraqi Security Forces.

But the most telling of all is that Maliki, long in the oil debate shadows and letting affiliates like Oil Minister Hussain al-Shahristani lead the charge against the KRG oil policies, has now opened fire, Voices of Iraq reports.

“All oil contracts signed by Kurdistan’s government with foreign companies violate the constitution,” Maliki said. “Since the beginning, all parties agreed to amend the constitution, and a committee had been formed for this purpose,” he noted. “It is important to amend the constitution.”

The 2005 Constitution was only approved by political factions because it was vague enough to not turn anyone off. In the case of the oil sector, there’s a dispute over interpretation. There were two ways to end that dispute, though one received more public and legislative attention.

A new oil law was to determine the role of the central government and oil-producing region/provincial governments, as well as the extent international oil companies would be allowed to invest. More than two years of debate has not produced an acceptable draft of the law.

Others have urged for amendments to the Constitution to clarify the extent of federalism in the oil sector, thus smoothing the debate over jurisdiction, the role of the federal Oil Ministry, and the two dozen deals the KRG has signed.

Negotiators for the two sides have been meeting off and on, and a Nov. 15 conference intended to end the disputes did not. On the agenda was the oil law, the KRG oil deals – among other budgetary and security forces issues – but in the end it was scuttled over, among other things, the prerogative of some amend the Constitution.

The KRG says it won’t respond to Maliki until it receives an official documentation of his accusations, Voices of Iraq reports. Firyad Rwandizi, the spokesman of the Kurdistan Coalition – the KRG and independent Kurds’ voice in the federal government – called for compromise, The Kurdish Globe reports.

In a separate editorial in The Globe, Azad Aslan issues nearly a call to arms over Maliki’s comments – “typical of the oppressive Arab mentality that is accustomed to decades of oppressed-oppressive relations of Kurds and Arabs in Iraq. … The Kurds must realize their potential power and force and adjust their policy accordingly without pity or naivety, but with vision and courage.”

Shell and Iraq’s gas

As had been rumored, Turkey’s state oil companies have inked a partnership deal with Shell for development of Iraq’s gas fields and exports. Zerin Elci for Reuters writes Turkey Energy Minister Hilmi Guler announced both the oil company TPAO and pipeline firm BOTAS are in on the action.

This is part of the larger plan Iraq has to develop major gas fields. It is beginning the process by offering the fields up for international companies to bid on. The Oil Ministry has said it prefers consortiums instead of single operator/investor bids.

There is plenty left to be decided after the fields are awarded, expected mid 2009. This includes whether the gas will be used domestically and, if exported, whether it will go through Syria and the Arab Gas Pipeline or via a new pipeline to be built through the north of Iraq. Both would end up in Turkey and then onto consumers in Europe.

This deal, it should be noted, is different than the controversial gas joint venture Shell and Iraq’s Oil Ministry signed for gas in the south.

The latest on the Status Of Forces Agreement

As always, McClatchy Newspapers’ Nancy A. Youssef and Leila Fadel are connected to both the Iraqi and U.S. thinking on it.

Maya Schenwar writes in Truthout.org about legal questions over its validity.

In case you’re just tuning in on it, see Iraq Oil Report’s coverage of it this week, including our breaking story of the text of the SOFA.

The Battle For Basra

Officials in Iraq’s oil capital province of Basra have begun the legal work to form a semi-autonomous region, Reidar Visser explains in Historiae.org.

Basra is the home to most of Iraq’s oil reserves, 90 percent of production and 80 percent of exports.

There are legal and legislative steps created to allow this, though exactly what the end game looks like is unclear. The KRG has been semi-autonomous since 1991, though the degree of control has irked Iraqi nationalists – Arab chauvinists, Kurds call those against Kurdish autonomy – and many Iraqi nationalists are also Basrawis. KRG President Massoud Barzani has reiterated his support of the formation of other regions, The Kurdish Globe reports.

In a separate article, Visser, an Iraq expert and research fellow at the Norwegian Institute of Institutional Affairs and part of the University of Oslo’s Gulf Research Unit, writes:

“The Basra federalists now face the far more challenging task of mustering the 10% needed to actually call a popular vote about Basra’s future. Simultaneously, there are signs that other pro-federal forces in and around Basra are still considering a bid that would compete with the project for a single-governorate federal entity based on Basra. Ever since 2004, other southerners have been working on a similar but slightly bigger federal project that would join Basra to Dhi Qar and Maysan in a tripartite union called the Region of the South (Iqlim al-Janub). This project has been somewhat less prominent since around 2006, but has remained popular in certain circles, including among some tribal leaders. Just like the uni-governorate Iqlim al-Basra scheme it has historically been presented as an alternative to the plan for a much wider nine-governorate sectarian Shiite federal region (Iqlim al-Wasat wa-al-Janub/Iqlim Janub Baghdad) which the Islamic Supreme Council for Iraq (ISCI) tried to promote from August 2005 onwards. With Dhi Qar and Maysan joined to Basra there would hardly be any oil left in the remaining six Shiite-dominated governorates, perhaps with the exception of Wasit.”

Juan Cole, University of Michigan’s Iraq expert and author of Informed Comment also explains the intra-Shiite battle over Basra’s future.

The regionalization moves also calls into question the importance of provincial elections, to take place in January, Alsumaria TV reports.

Read what Iraqis read: the Iraq Press Roundup by UPI’s Alaa Majeed.
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The Status Of Forces Agreement, or SOFA, is nearing a late-November deadline when Iraq’s Parliament is to recess, and the end-December deadline when the current U.N. mandate is to expire.

Iraq Oil Report broke the text Tuesday, and Parliament’s first attempt to debate it didn’t go too well, as Campbell Robertson and Suadad al-Salhy report for The New York Times “boiled over into shouting and physical confrontation.”

Leila Fadel of McClatchy Newspapers offers her must-read
analysis of the agreement.

For more perspectives: Tina Susman for the Los Angeles Times and Charles Levinson for USA Today

Prime Minister Nouri al-Maliki is pressing Parliament to approve the SOFA Adam Ashton reports for McClatchy Newspapers.

White House Spokesperson Dana Perino said the Iraqi cabinet approval a reason “to celebrate the victory that we’ve had so far.”

Michael Abramowitz reports in The Washington Post the Bush reversal on ‘no timeline, no way’ gives an Obama administration some leeway in any U.S. withdrawal agenda. The end-2011 deadline would require a near immediate action for withdrawal, as Washington Post’s Ann Scott Tyson reports Joint Chiefs of Staff Chairman Admiral Michael Mullen says it would take two to three years.

Iraq’s Sunni Parliamentarian leadership wants a referendum on the pact Democracy Now reports. And the pact could lead to violence, UPI reports.

The New York Times reporters Anwar J. Ali and Campbell Robertson see an alarming trend of increasing violence and belief it comes from U.S. pressure on the Status Of Forces Agreement.

Ali Baban, Iraq’s Minister of Planning and Development Cooperation, discusses the Iraqi economy and the likely effects upon it of the Obama administration and the signing of the U.S-Iraqi security pact, with Sa’ad Salloum of Niqash.

Prime Minister Nouri al-Maliki’s coalition is becoming more fragile as the Kurdish Coalition appears ready to walk over a number of issues. PUK Media reports a major new roadblock is the central government’s attempt to set up so-called “supporting councils,” whose scope and purpose is not totally clear. As Iraq Oil Report told you earlier, a Nov. 15 meeting between central and regional leadership aimed at settling issues over oil and non-oil related disputes stalled on this and other issues, including proposed amendments to the Constitution.

The Financial Times’ Anna Fifield has a great tale of the power struggle over the northern oil capital Kirkuk and Kurdish-Arab relations.

The International Crisis Group’s ongoing analysis of the conflict between Iraq’s Kurds, Arabs and their neighbors to the north is available here: Turkey and Iraqi Kurds: Conflict or Cooperation?

Iraq Oil Ministry’s Oil Drilling Co. is in the market for two helicopters, The Associated Press reports.
Here’s the actual tender document.

The KRG’s Ministry of Electricity brought the U.N. Development Program in on supervising nearly $6.5 million in electricity projects, Voices of Iraq reports.

Alive in Baghdad: Sahwa, What Next After Al-Qaeda?

The Sahwa Councils or what are also known as “Sahwa Forces” had a strong impact and important role in bringing stability to some areas of Iraq such as Anbar province, Ramadi, Fallujah, and some other areas in Baghdad. Those forces were created after Sattar Abu Risha suggested the idea of creating local forces recruited within the same area the forces will be responsible for. However, some Sahwa Forces succeeded in protecting their areas while others did not. There have been some rumors spread about cooperation between the Sahwa forces and Al-Qaeda, in some areas of Baghdad. Some Iraqis began to be afraid of the Sahwa Forces due to some accidents happening in Baghdad such as kidnappings and robbery under the Sahwa protection.

A U.S.- and British-based equity firm is overseeing the payroll of moderate Iraqi imams counseling prisoners in Iraq, Nick Mottern and Bill Rau write for Truthout.org.

The U.N. Special Envoy to Iraq has praised Iraqi Parliament’s approval of a Human Rights Commission, UPI reports. The text of the legislation, which must be approved by the Presidency Council before it becomes law, was first published Tuesday on Iraq Oil Report.

Read what Iraqis read: the Iraq Press Roundup by UPI’s Alaa Majeed.

THURSDAY’S IRAQ OIL REPORT: Developments in the struggle to control the oil capital of Basra.
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It must still be approved by Iraq’s Parliament, no easy task. Iraq Oil Report will have more on this Wednesday. Also still in the dark, the details of the Strategic Framework surrounding work in the economic and other sectors as part of the SOFA package.

From the SOFA text:

Article 26
Iraqi Assets

1. To enable Iraq to continue to develop its national economy through the rehabilitation of its economic infrastructure, as well as providing necessary essential services to the Iraqi people, and to continue to safeguard Iraq’s revenues from oil and gas and other Iraqi resources and its financial and economic assets located abroad, including the Development Fund for Iraq, the United States shall ensure maximum efforts to:

a. Support Iraq to obtain forgiveness of international debt resulting from the policies of the former regime.

b. Support Iraq to achieve a comprehensive and final resolution of outstanding reparation claims inherited from the previous regime, including compensation requirements imposed by the UN Security Council on Iraq.

2. Recognizing and understanding Iraq’s concern with claims based on actions perpetrated by the former regime, the President of the United States has exercised his authority to protect from United States judicial process the Development Fund for Iraq and certain other property in which Iraq has an interest. The United States shall remain fully and actively engaged with the Government of Iraq with respect to continuation of such protections and with respect to such claims.

3. Consistent with a letter from the President of the United States to be sent to the Prime Minister of Iraq, the United States remains committed to assist Iraq in connection with its request that the UN Security Council extend the protections and other arrangements established in Resolution 1483 (2003) and Resolution 1546 (2003) for petroleum, petroleum products, and natural gas originating in Iraq, proceeds and obligations from sale thereof, and the Development Fund for Iraq.

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Apologies to readers: over the past week regular updates have been delayed as Iraq Oil Report puts the finishing touches on a re-launch and brand new website. It is an exciting time and we think the new design and content distribution will help deliver exactly what you want…but even better. Stay tuned as the new site is only weeks away.

A source tells Iraq Oil Report a meeting Nov. 15 between Iraq’s central and Kurdistan region government leaders did not lead to any breakthrough on the standoff over Iraq’s oil law and the dispute over the central government and KRG’s oil deals. The meeting was overshadowed by the Status Of Forces Agreement as well as the consideration of making clarifications and other changes to the Constitution. The latter is considered necessary to clarify the broad, vague language in the Constitution, passed in 2005. That could settle many of the disputes over jurisdiction of the oil strategy, but is highly controversial as both sides have been invested in passing new legislation instead of amending the Constitution. However, the source says Parliament will take up the oil law regardless.

As Iraq’s Oil Ministry and Royal Dutch Shell continue their negotiations and cooperation on a joint gas venture, it’s time to follow up on the reporting done by UPI’s Ben Lando and Alaa Majeed (see below) by making public for the first time the entire Heads of Agreement.

Shell-Iraq gas company is a monopoly, secret agreement shows

Shell secures 25-year access to Iraq’s oil, gas

Gas deal no monopoly, Shell and Iraq say

Here’s the Heads of Agreement: Click Here.

PetroVietnam and the Iraq Oil Ministry are nearing the final stage of revamping a deal to develop the Amara oil field in Iraq’s Maysan province. Hassan Hafidh reports for Dow Jones Newswires talks began earlier this year and will be concluded early next year. The state firm signed a deal with Saddam Hussein in 2002 but was prevented by U.N. sanctions and war from beginning work.

Iraq recently put the final ink on the new deal with the Chinese National Petroleum Corp., the revision of the Saddam-era contract, which Ruba Husari of International Oil Daily has the latest on.

As UPI’s Ben Lando has been reporting for more than a year, these are not new deals but a renegotiation of four Saddam-era deals that Iraq’s Oil Ministry still considers legal under international law. ONGC of India and Pertamina of Indonesia are also en route to a new text of an oil deal.

The Kirkuk coordinating committee has met for the first time. IraqSlogger.com reports it is the first of planned twice-weekly sessions to produce recommendations to Prime Minister Maliki as to how the northern oil hub and disputed territory should be governed, one of many disputes between the KRG and others in Iraq.

An assassination attempt of the general inspector of Iraq’s Electricity Ministry, Saadi al-Sudani, failed, Voices of Iraq reports, injuring his son.

Iraq’s Parliament has approved a new Human Rights Commission, and all that’s needed is Iraq’s President and two Vice Presidents to give it the green light. The Parliament’s Human Rights Committee, chaired by Sayyed Mohammed Al-Heidari, a member of an independent bloc within the United Iraqi Alliance, crafted the legislation, with the support of American University’s Center for Global Peace.

EXCLUSIVE ON IRAQ OIL REPORT: Read the text of the Law of High Commission for Human Rights approved by Parliament Nov. 16, 2008. CLICK HERE.

Take trip into the Green Zone, with Niqash’s Kholoud Ramzi.

For the first time in years Fuad Flaih is able to take a taxi all the way to his house in Kufa, one of Najaf province’s biggest districts, Faris Harram writes for Niqash. Until just one year ago, cars were unable to enter the area as a result of considerable road damage and swamps.

Iraq’s inspector generals face mass firings. Those getting the axe are not only those whose work has been sub-par, but Iraqis who have investigated active ministries, ministers and members of Parliament, James Glanz and Riyadh Mohammed report for The New York Times.

Read what Iraqis read: the Iraq Press Roundup by UPI’s Alaa Majeed.

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News of the Iraq oil law being sent to Parliament may be a little too optimistic.

“Two weeks ago (Kurdistan Regional Government President) Massoud Barzani was in Baghdad for talks with (Iraqi Prime Minister Nouri) al-Maliki,” KRG Natural Resources Minister Ashti Hawrami told the Middle East Economic Survey (MEES). “They agreed all outstanding issues, including the oil law, be dealt with by a high-level committee and be decided in line with the constitution. All these reports of the oil law going to Parliament are nonsense. There is no basis for this. None of it will succeed without the agreement of this committee.”

As MEES reports, and the Iraq Oil Report continually informs our readers, the oil law is one aspect of many in the debate over the future of Iraq, its governance, its citizens and its oil. The oil law varies in importance as relations between governments and government and citizens is fluid.

This is evident in a recent Al-Sharqiyah TV interview with three Iraqis – two key Iraqi members of Parliament and one Iraqi involved in the international oil and gas industry. They blamed Iraq’s Oil Ministry, and the minister himself, who has recently solidified political alignment with Maliki.

The head of Iraqi Parliament’s Oil & Gas Committee has raised questions over the gas deal Iraq’s Oil Ministry is negotiating with Royal Dutch Shell. Tim Cocks reports for Reuters. “There hasn’t been much transparency in this agreement,” said Ali Hussain Balou. “Shell signed this agreement with the ministry … They did not give a chance to another company. We want to know why.”

To be fully caught up with the controversy, here’s the breaking story from Monday and the response from Shell and the Oil Ministry Thursday.

Iraqi oil exported to Turkey has resumed following an explosion on the Turkish side of the pipeline, Alsumaria TV reports.

Pro-PSA: Majid Jafar, executive director of Crescent Group, whose companies are active in the KRG, gives his backing to the production sharing contract model in MEES.

Iraq and Obama

In “The Obama Administration, Iraq, and the Question of Leverage,” Reidar Visser in Historiae.org compares and contrasts the Obama-Biden Iraq plan with competing U.S. plans for Iraq – and reality.

An open letter to President-elect Obama from Iraq Veterans Against the War.

What Iraq Needs from the Obama Administration, a recap of a recent session with Iraqis living in the United States at the U.S. Institute of Peace.

Obama’s Top Three Foreign Policy Priorities, Foreign Policy In Focus senior analysts give their priority list.

Alive in Baghdad

Iraqi Professors Demand Rights

Security, Society & Politics

The evolution – and relevance – of Moqtada Sadr and the Mahdi Army, by Ned Parker for the Los Angeles Times:

“…With his armed wing formally frozen, Sadr looked to repair his movement’s image. He announced in June that his fighters should form a new social and religious education organization, named Mumahidoon, which aims to teach Iraqis about Islam. Some fighters would also be tapped to join an elite armed wing that Sadr has authorized to fight the Americans, outside the cities away from civilian populations.

Sadr’s top aides echoed his message that the old Mahdi Army was finished in the cities.

“The Americans may fear that the Mahdi Army will come back with weapons. We tell them no. That chapter is finished. The struggle is now in parliament and the political arena,” said Sheik Hazem Araji, a senior advisor to Sadr….”

The Basra revival: National Public Radio’s Corey Flintoff discovers the people who survived the fundamentalist grip on the country’s most cosmopolitan city.

The New York Times’s Lonely War, by Seth Mnookin in Vanity Fair. In 2003, even small daily papers rushed to send embeds to Iraq, the “starter war” that could make a rookie reporter’s reputation. Today, The New York Times is one of the few U.S. news organizations that haven’t significantly cut back their presence, spending more than $3 million a year to maintain a heavily fortified Baghdad bureau.
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In an interview with United Press International’s Ben Lando on the sidelines of an energy conference here, Bayati said if talks for a U.S. troop deal fail by the end-of-year expiration of the current U.N. mandate, the U.N. Security Council is ready to extend it.

A: Yes. Any creditor will be able to confiscate Iraqi money or Iraqi oil shipments, but with immunity under Chapter 7 they can’t do that. So there are some advantages to having that. Though if we are going to extend the mandate of Multi-National Forces under Chapter 7 by the Security Council, then we will enjoy the extension of the immunity for the DFI and for the oil shipments.

Q: And what about the removal of Iraq from Chapter 7, whether it’s Status of Forces Agreement, are you looking to protect today’s Iraqi money from being held liable for Saddam’s Iraqi decisions?

A: We have other options, and we are considering any other option if we don’t extend the mandate of the Security Council, we have other options to protect Iraqi money.

Q: What are those? Would it be because it’s in a U.S. bank, having the U.S. presidential decree like it has now?

A: Yes, in the U.S. we have the presidential decree. In some European countries we have certain banks who could have immunity for central bank money, so there are some other measures we are considering.

The Washington Times has picked up on Ben Lando and Alaa Majeed’s story for United Press International.

A top Shell official talks about the bidding round for oil and gas field development with International Oil Daily’s Ruba Husari. “Despite its disappointment that Iraqi oil fields it had been studying were opened to international bidding, Royal Dutch Shell says it welcomes the transparent process Iraq has chosen for its first landmark bid round. But the Anglo-Dutch supermajor’s upstream chief, Malcolm Brinded, says he needs to see contract terms before assessing whether the service deals have “long-term robustness” in the absence of a nationwide hydrocarbon law. … Since signing a heads of agreement for its south gas utilization project in September, Shell has had staff on the ground in southern Iraq surveying gas facilities, as stipulated in its preliminary agreement. The move is considered bold for an international oil firm, particularly one of the majors, which generally avoid sending staff to Iraq. “The numbers of people that we have on the ground and what their roles are will need to be always carefully assessed,” Brinded said. The advantages of the current set-up are that work on the project, which will involve gathering, processing and marketing currently flared gas, is done in close partnership with South Gas Co. — which has significant operating capabilities on the ground — and Shell is not involved in the upstream, he said.”

Read what Iraqis read: the Iraq Press Roundup by UPI’s Alaa Majeed.

For great Iraq-based Obama election coverage, read Leila Fadel and Corinne Reilly for McClatchy Newspapers.

There is now a dispute between Shiite parties Dawa and the Islamic Supreme Council of Iraq over the proposal to allow armed tribal groups in the south carry weapons and act as official security. Ahmad Thamer Jihad has more for Niqash.

People call them the “wandering women.” They roam Basra’s city outskirts in search of valuable waste, suffering the pain and indignity of life amidst society’s rubbish, Saleem al-Wazzan writes for Niqash.

The women come from the rapidly emerging poverty belts and slums of Basra and practice a profession that nobody else wants. They spend their days searching the city’s garbage dumps for plastic containers, leather shoes, cardboard, copper, old electrical appliances, car machinery and an array of other goods that can be recycled or sold on.

During the 1990s special recycling workshops appeared in poor areas of Basra and since their creation they have used women as cheap labour. Today, these workshops are flourishing.

Forty-five year old Umm Awad lives in al-Hayyanah village near Basra. She worked as a wandering woman until she lost one of her legs when a mine exploded as she searched for metal scraps along the border with Iran.

She now works 12 hours each day in the unlicensed workshop of Raad al-Darraji, sorting through and cleaning the goods that are brought in. “It is a job that breaks one’s back,” she said describing her daily tasks which include boiling old shoes to get the heels off, scraping electric wire to take out the copper, and cleaning bottles.

Sitting on a low chair with her one leg stretched out before her, Umm Awad described her fellow workers as a poor and illiterate group. She blamed men for preventing women from gaining the education that would provide them with better jobs. “Husbands, brothers and the men of the tribe do not like to see women go to schools,” she explained.
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Officials at Royal Dutch Shell and the Iraqi Oil Ministry refute claims that a proposed gas joint venture would have exclusive access to Basra province’s gas industry, though a key member of Parliament criticizes the project, Ben Lando and Alaa Majeed report for United Press International.

“It is only a partnership,” said Oil Ministry spokesman Assem Jihad. “There will not be a monopoly of the gas.”

United Press International first reported this week, with previously undisclosed documents, a deal signed in Baghdad Sept. 22. It was the preliminary step to forming a joint venture company.

The “Heads of Agreement,” basically a rough draft of the contract, a legal framework establishing the management team and the scope, purpose and other details of the company, says the company would operate for 25 years.

“We are at a very early stage,” said Shell spokeswoman Kirsten Smart. “This is a joint heads of agreement, a preliminary agreement which is then followed by discussions to formalize the joint venture.” …

Jabir Khalifa Jabir, a member of the Shiite Fadhila Party, the ruling party in Basra, and a member of the Parliament Oil and Gas Committee, said local governments need to be included in such decision-making.

“The joint venture is a constitutional and legal violation, because the governorate of Basra didn’t take part in the negotiation. It is a long-term monopoly that allows Shell to export gas when Iraq is in need of that gas. This joint venture will include all of Basra and more likely to the entire region of the south.”

Read the entire article: Click Here.

Iraq’s Parliament will begin debate next week over the long-stalled and highly controversial oil law, the first post-Saddam Hussein law governing oil and gas, Ben Lando reports for UPI.

The first version of a new oil law was approved by negotiators in February 2007, but the political road has been rough for the legislation. It’s seen by some as necessary for bringing needed foreign investment; others say it will guide Iraq in rebuilding its own domestic oil company strength.

“It’s one important step which is going to be implemented and an effective tool to comfort the investor,” said Abdul-Hadi al-Hassani, deputy chair of the Parliament Oil & Gas Committee, in order to protect their investment while regulating it for the benefit of Iraqis.

An explosion on the Turkish side of the Iraq-Turkey pipeline has cut oil flow and left an oil spill near or possibly in the main lake near Ataturk Dam. Today’s Zaman reports Turkish officials say the pipeline was not attacked, rather the explosion was caused by a change in pressure. The pipeline cuts through a Kurdish area of Turkey, in a country on alert as attacks by the separatist group PKK (Kurdistan Workers’ Party) increase. Zaman reports after the oil is cleaned up, five days worth of repair are in order, and the total cleanup process could take a month.

Oil companies from Pakistan, Thailand, Angola, Algeria, Turkey and Vietnam are qualified to bid on Iraqi oil and gas field deals to be awarded next June, UPI reports. Iraq’s ambassador to the United Nations, Hamid al-Bayati, said the government wanted to add national oil companies to the 35 other companies — some of the world’s largest — that will offer deals to develop the fields.

Pakistan Petroleum, the Petroleum Authority of Thailand, Angola’s Sonangol, Algeria’s Sonatrach, Turkish Petroleum Corp. and Petrovietnam now are considered prequalified by the Oil Ministry for Iraq’s first bidding round.

Iraq has started receiving the first of 300 trucked oil tankers with 36,000 liter capacity, Noozz reports. These will help the flow of fuel within and between provinces.

Addax Petroleum has announced the success of a well appraisal in the Iraqi Kurdistan Taq Taq block, according to a company statement. Addax is partnered with Genel Enerji on the project.

We’ve got the transcript of KRG President Massoud Barzani’s talk and press conference at the Center for Strategic and International Studies. CLICK HERE for the word doc.

Q: Thanks, it’s Elizabeth Rosenburg with Argus Media. Mr. President, can you give us a status update on the communications or negotiations between the KRG and the federal government in Baghdad about exporting oil from the KRG and also Baghdad’s recognition of the contracts awarded by the KRG to several oil companies?

MR. BARZANI: In fact, the constitution is very clear in talking about the oil issue. It talks about the existing oil fields that will be managed by the federal government together with the regional governments. And for the new oil fields, they will be managed by the Kurdistan regional government. But at the same time, it talks about the revenue share – that revenues should be shared by both. And in addition to that, there was a draft oil law not that was prepared in February 2007 and was supposed to go to the cabinet – Iraqi cabinet, council of ministers, and from there to go the Iraqi council of representatives. It has with it a side letter. Side letter was stating that if there would be no agreement on the oil law until May 2007, then both sides would have right to sign contracts.

Of course, the agreement was not reached; therefore, based on that draft law and the side letter, which was an annex to the draft, as well as the constitution, and what the constitution says – we have continued to deal with this. But in the last meeting that we had in middle of October in Baghdad, at the political council of the national security, we have agreed that we will form a strong committee, a committee that would be comprised of the political leadership in Iraq in order to deal with it, because right now, the issue needs a political decision and the political decision has to be made by the Iraqi political leaders. And according to the constitution, we agreed that there would be revenue sharing and also that oil and gas in Iraq belongs to all the Iraqi people in all regions and governorates. Therefore, we do not have any problem in sharing the revenues and also working hard to reach an agreement on the hydrocarbon law.

Italy’s Trevi said it had won more than $140 million worth of contracts in Iraq and Venezuela to supply services and equipment for drilling gas and oil, Reuters reports.

Read what Iraqis read: the Iraq Press Roundup by UPI’s Alaa Majeed.

The Iraqi government announced plans to purchase more than 500 military aircraft from the United States and France, with first deliveries expected in 2011, UPI reports.

The United States has responded to changes Iraqi officials made to the pact on maintaining a U.S. troop presence in Iraq, a White House spokeswoman said, UPI reports.“We have gotten back to the Iraqis with a final text,” Dana Perino said during a Thursday news briefing. “Through this step we’ve concluded the process on our side, and now it is in their court to move forward with their process.”

DynCorp International has been contracted by the U.S. Defense Department to support the transition of responsibilities to the Iraqi government, UPI reports. Under the $99 million deal, U.S. company DynCorp will support the Multi-National Security Transition Command-Iraq transition of security responsibilities from Multi-National Forces to the Iraqi government.

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Plus:
*Oil Ministry presses Parliament on oil law action
*Alive in Baghdad: Who would Iraqis vote for – McCain or Obama?
*Violence in Context
*Iraq Press Roundup
*USIP: Iraq’s Cultural Heritage: Preserving the Past for the Sake of the Future
*Much more

A secret document obtained by United Press International reveals a planned joint venture company between Royal Dutch Shell and the Iraqi Oil Ministry would give the company a 25-year monopoly on the gas industry of southern Iraq, Ben Lando reports for United Press International.

Shell and the ministry are currently negotiating the terms of the joint venture company. On Sept. 22 the two signed what’s known as a “Heads of Agreement,” basically a rough draft of the contract, a legal framework establishing the management team and the scope, purpose and other details of the company.

Though it’s non-binding, the confidential document is telling.

If the joint venture company is finalized as outlined in the HOA, it would give Shell the largest role in Iraq’s oil and gas sector since the 1960s, when the world’s Big Oil firms were kicked out after 40 years of virtual control of exploration, production, exports, and payments to the government.

The joint venture will be the “sole gas company engaged in business,” as outlined in the HOA, “and providing gas for domestic and export markets and generating revenues from gas marketing activities.”

At the time of the HOA signing, Shell and ministry officials pitched the future joint venture company’s role as utilizing for domestic needs the natural gas currently being wasted in Basra province. Iraq would own 51 percent and Shell 49 percent. …

The oil and gas sector is in need of new and modern investment, though there’s a dispute over how to proceed: rebuild the once prominent domestic oil and gas industry or allow foreign companies to re-enter the sector. …

According to the previously unseen HOA, “the joint venture will off-take and purchase all Raw Gas produced in the South of Iraq by either the South Oil Co. or any other producer.” The HOA defines “South of Iraq” as the southernmost province — and oil and gas capital — of Basra, though a map appendix to the HOA shows the contract territory extending for an unknown distance into the Persian Gulf “and any other areas as may be agreed by (Shell and the Oil Ministry).”

The joint venture would not focus solely on gas currently being produced in the agreed upon area. As oil production increases, as expected by the ministry, so will the gas; most of Iraq’s gas production is what’s called “associated gas,” found during oil production.

Iraq has the world’s 10th-largest proven gas reserves, according to the U.S. Energy Information Administration, most of it located in southern Iraq. Two to three times more reserves could be found when it is fully explored, and much more expected to be “non-associated” gas, reservoirs independent of the oil.

“The Parties acknowledge that access to non-associated gas is essential to ensure that the aims of the Joint Venture are met,” the HOA states, adding one of the objectives of the company is to “pursue development of non-associated gas fields in southern Iraq according to respective rules and regulations for field development in Iraq.”

There’s more if you read the entire story: Click Here.

Iraq’s Oil Ministry renews its calls on Parliament to make progress on the oil law, The Associated Press reports.

Iraq has corrected its budget in light of the oil price slump. Lionel Laurent reports for Forbes on what this all means.

Alive in Baghdad: Who would Iraqis elect, Obama or McCain?

With the United States Presidential election looming and Iraq coverage dwindling dramatically, we decided to combine the two topics. Correspondents Nabeel Kamal and Ali Al-Le’abiy hit the streets of Baghdad and interviewed several Iraqis as to their opinion of the candidates. Our sampling was done in a short timeframe and by no means represents a statistically accurate cross-section of the Iraqi public. However, we do feel that you will hear an array of different opinions, and begin to gain a little insight into how the Iraqi public views the American government and electorate, more than five and years after the invasion.

Violence in Context

Iraq has been less of a campaign issue in the United States presidential race as the economic crisis soars and the level of violence in Iraq decreases, Liz Sly reports for the Chicago Tribune. “But the violence is still at a level that would be intolerable in any other society.

Take the sniper of Mansour, who has killed at least six Iraqi soldiers in recent weeks in this upscale neighborhood, shooting from a distance across crowded shopping streets and a busy traffic circle.

“It is safe here, very safe,” said Hussein Aamer, 25, who owns a fashion store near the scene of one recent shooting. “Or at least, it’s 90 percent safe. It’s true there is a sniper, and we had some small bombs,” he says, pointing in the directions from which recent attacks had come.

“But still it’s completely different now, like the difference between the sky and the earth, compared to 2007 and before.” …

Such is the tenor of life these days in post-surge Baghdad, where the presence of a sniper in a community’s midst can be shrugged off as a minor annoyance compared to the onslaught of car bombings, killings and kidnappings that raged throughout 2006 and much of 2007.”

Iraqi reporter Waleed Ibrahim writes for Reuters about the complexity of today’s Iraq, and adds a reminder how there is no false experience in Iraq. He recounts how in 2003 his father-in-law expressed fear that as U.S. tanks rumbled through Baghdad there would come a day when Saddam would actually be missed:

For five years, I have been asking myself the same question: how did it come to be that Iraqis like my father-in-law, driven to live as an illegal immigrant outside Iraq, rue Saddam’s fall?

I can say without hesitation that many Iraqis share my father-in-law’s feelings. Not because they supported Saddam, although there are many who still do, but because the hopes of a better life that were born in April 2003 have been crushed.

Iraqis today spend a great deal of time comparing their lives today to the situation before 2003. It’s not a winning comparison. Unbelievable bloodshed, a lack of basic services from electricity to clean water, and widespread unemployment have made life hellish for many Iraqis.

It is true that there is less violence today than there was a year ago, but assassinations, bomb attacks and other grim acts still occur on a daily basis. All this casts a dark shadow on the security situation in Iraq and reminds us of the fragility of Iraq’s vaunted turnaround.

A conversation with any person on any Iraqi street will be one marked by disappointment. Anger is particularly sharp at Iraq’s political class, which is now locked in a fierce power struggle at the highest levels while most ordinary Iraqis struggle to simply get by.

Amid Iraq’s violence, a radio station gives people hope, Corinne Reilly reports for McClatchy Newspapers. “In a city overwhelmed by the complexities and uncertainties of war, Sumer FM is one thing its listeners can count on. Launched by a Lebanese businessman in November 2004, the station has stayed on the air every day since, even through Baghdad’s most violent months.

A year ago, it was so dangerous here that many Iraqis were afraid to even leave their homes, and the cost of living in Baghdad has skyrocketed since the 2003 U.S.-led invasion. But staying in and listening to the radio has remained safe and cheap.

Even when the electricity is out, as it still is for large portions of the day here, the radios stay on.”

Baghdad should reconsider its stance on inviting Iraqi refugees back to the country until the security situation is stabilized completely, aid groups said, UPI reports.

Read what Iraqis read, the Iraq Press Roundup by UPI’s Alaa Majeed.

Iraq’s Cultural Heritage: Preserving the Past for the Sake of the Future - Elizabeth Detwiler of the U.S. Institute of Peace releases their latest briefing, on “the continued looting of Iraqi antiquities and measures that have been taken to recover and protect Iraq’s cultural heritage. In addition, it highlights the value of international law and policing to prevent such crimes.”
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