New Iraqi Oil Law Sets Rules for Boosting Investment and Output
Reuters. Jan 18, 2007
Baghdad: Iraq's oil committee has agreed on the a final draft of an Oil Law
that sets rules for sharing revenues and boosting output and aims to bring in
billions of dollars of foreign investment, an Oil Ministry spokesman said on
Wednesday.
The draft, drawn up by senior national and regional leaders, calls for a
federal committee headed by the prime minister to oversee all future contracts.
It will have the power to review existing deals signed under Saddam Hussein or
by the Kurdish regional government, spokesman Asim Jihad said.
"The committee has fin-alised the draft of the law last night which has been
approved unanimously by all the members of the committee and it will be before
the cabinet early next week," Jihad said.
Passing an oil law to help settle potentially explosive disputes among Iraq's
ethnic and sectarian communities over the division of the world's third-biggest
known crude oil reserves has been a key demand of the United States in providing
further military support to the national unity government.
Achievement
"Everybody sees this law as a big achievement and as a national project.
There are no differences on the law," Jihad said.
The oil committee, headed by Deputy Prime Minister Barham Salih, will send
the draft to cabinet next week for full approval. After that it will go to
parliament. Officials hope that the broad base of the negotiating team means it
will pass easily.
The final draft was in line with earlier versions described last month after
a previous round of talks. A national oil company would be set up to develop
production and exports and the law is intended to ensure balanced development of
the oil industry across Iraq's regions, Jihad said. It establishes a mechanism
for centralising oil revenues and distributing them to the regions.
Jihad refused to say who will negotiate with the international firms but said
that a federal council will have the final word on approving the contracts.
The division of oil is a key factor in communal tensions in Iraq. The
southern oil fields around Basra lie in territory controlled by competing
factions of the Shi'ite forces, some of whom are close to Iran.
The northern fields lie on the edge of Iraqi Kurdistan around the city of
Kirkuk. Kurds want to annexe the city as their regional capital and ethnic Arabs
and Turkmen accuse the Kurdish militants of ethnic cleansing before a referendum
on the city's future, which is due this year.
