Comments on: Shelling out Iraq’s gas http://www.iraqoilreport.com/oil/shelling-out-iraq%e2%80%99s-gas-1612/?utm_source=rss&utm_medium=rss&utm_campaign=shelling-out-iraq%25e2%2580%2599s-gas The Source to Iraq, Its People and Its Oil Fri, 27 Jan 2012 20:18:25 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Ahmed M. Jiyad http://www.iraqoilreport.com/oil/shelling-out-iraq%e2%80%99s-gas-1612/#comment-14033 Ahmed M. Jiyad Sun, 07 Jun 2009 11:54:39 +0000 http://www.iraqoilreport.com/?p=1612#comment-14033 In my detailed and comprehensive assessment on HOA entitled “Iraqi-Shell Gas Deal: who occupies the driver’s seat?” had led to a number of discouraging conclusions all of which would indicate to detrimental impacts on the national Iraqi interests. The process and manner in which HOA was developed from inception to entering into force contravenes basic legal frameworks and thus can be legally contested. HOA would clearly and unambiguously indicate to Shell’s intention or possibility to acquire a position through this partnership that provide it with effective control to insure a prolonged capture of monopoly rent. Furthermore, HOA constitute and could create severe and effective restrictions that are tantamount to an unacceptable infringement on the country’s sovereignty in pursuing development policy to utilise its hydrocarbon resources. The presence or possible occurrence of any conflict of interest would results in significant erosion of Iraq’s interest and substantial financial losses over a very prolonged period. The potentiality and probability of abusive transfer pricing is considerable under “Economic Model” and the “Commercial Structure” of the agreement. HOA creates Joint Management Committee- JMC and vest it with enormous and powerful authority. In the mean time there is an alarming absence of any reference to good governance system to insure transparency, accountability and verifiability to provide effective oversight over JMC. Though HOA is supposed to be a preliminary and guiding framework, it contains clauses regarding “Legal Status”, international arbitration with defined forum, and “Termination”, all of which make HOA a binding document close to a contract! Considering the fact that HOA entered into force on the day it was signed, MoO has established dangerous precedence of a “pre-emptive regulatory capture”’ attitude, which could seriously and gravely undermines the constitutional process in the country. It might be, or indeed is, too late for the executive branch to do any thing to rectify the many deficiencies of HOA. The only option that is left to safeguard Iraq’s interest lies in the hand of the Parliament; it has the Constitutional power, the authority and the obligation to act immediately and address this HOA, and seriously examine the agreement or the contract relating to the anticipated joint venture between Iraq and Shell. The full text of the study is posted on the following websites: http://www.iraqoilforum.com/wp-content/uploads/2009/05/ahmad-musa-jiyad-iraqi-shell-gas-deal-who-occupies-the-drivers-seat.pdf http://www.energyintel.com/PubHome.asp?publication_ID=112 Ahmed Mousa Jiyad, Vaksdal, Norway Phone: (+47) 5659 5699 Email: mou-jiya@online.no In my detailed and comprehensive assessment on HOA entitled “Iraqi-Shell Gas Deal: who occupies the driver’s seat?” had led to a number of discouraging conclusions all of which would indicate to detrimental impacts on the national Iraqi interests. The process and manner in which HOA was developed from inception to entering into force contravenes basic legal frameworks and thus can be legally contested. HOA would clearly and unambiguously indicate to Shell’s intention or possibility to acquire a position through this partnership that provide it with effective control to insure a prolonged capture of monopoly rent. Furthermore, HOA constitute and could create severe and effective restrictions that are tantamount to an unacceptable infringement on the country’s sovereignty in pursuing development policy to utilise its hydrocarbon resources. The presence or possible occurrence of any conflict of interest would results in significant erosion of Iraq’s interest and substantial financial losses over a very prolonged period. The potentiality and probability of abusive transfer pricing is considerable under “Economic Model” and the “Commercial Structure” of the agreement. HOA creates Joint Management Committee- JMC and vest it with enormous and powerful authority. In the mean time there is an alarming absence of any reference to good governance system to insure transparency, accountability and verifiability to provide effective oversight over JMC. Though HOA is supposed to be a preliminary and guiding framework, it contains clauses regarding “Legal Status”, international arbitration with defined forum, and “Termination”, all of which make HOA a binding document close to a contract!
Considering the fact that HOA entered into force on the day it was signed, MoO has established dangerous precedence of a “pre-emptive regulatory capture”’ attitude, which could seriously and gravely undermines the constitutional process in the country. It might be, or indeed is, too late for the executive branch to do any thing to rectify the many deficiencies of HOA. The only option that is left to safeguard Iraq’s interest lies in the hand of the Parliament; it has the Constitutional power, the authority and the obligation to act immediately and address this HOA, and seriously examine the agreement or the contract relating to the anticipated joint venture between Iraq and Shell.

The full text of the study is posted on the following websites:

http://www.iraqoilforum.com/wp-content/uploads/2009/05/ahmad-musa-jiyad-iraqi-shell-gas-deal-who-occupies-the-drivers-seat.pdf

http://www.energyintel.com/PubHome.asp?publication_ID=112

Ahmed Mousa Jiyad,
Vaksdal, Norway
Phone: (+47) 5659 5699
Email: mou-jiya@online.no

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