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IRAQ: Flurry of oil deals with foreign firms continues

Azzaman

June 25, 2008

Both the central government in Baghdad and the regional Kurdish government in Arbil are vying to lure oil majors to sign deals to develop Iraqi oil fields.

But the rush, analysts say, is full with risks in the absence of laws and regulations on the division of royalties and nature of the deals.

The Kurdish government announced Tuesday the signing of yet two other contracts, one with the Canadian Talisman Energy Corporation and the other with Western Zagros for the development of two oil fields in the disputed Province of Kirkuk.

The Oil Ministry has recently given 35 foreign oil firms the permission to boost currently producing fields and develop new ones.

With the two deals with Talisman and Western Zagros, the Kurds will now have 17 such deals with foreign firms.

But the Kurdish deals are in the eyes of the central government illegal as they are being signed prior to the passage of a controversial gas and oil draft law still being debated in the parliament.

The Kurds retort that the central government itself has signed such deals while the oil law remains on parliamentary shelves.

But the danger of the Kurdish deals emanates from the fact that some concessions to foreign firms fall in areas outside their traditional autonomous enclave of the provinces of Arbil, Dahouk and Sulaimaniya.

Some of the deals are in territory administratively part of the Province of Nineveh and others tackle oil fields situated in the disputed oil rich Province of Kirkuk.

The Kurdish deals have sparked the anger and indignation of other ethnic groups in the two provinces and analysts believe they could be the catalyst for a new round of violence in these two provinces.

Anti-U.S. and anti-government groups have vowed to attack foreign firms and Kurdish government officials working outside the enclave.

Moreover, the deals whether by the Kurds or the central government lack the necessary transparency. The applications are picked by officials regardless of whether there might have been better bidders.


:: Article nr. 45182 sent on 26-jun-2008 05:38 ECT

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Link: www.azzaman.com/english/index.asp?fname=news\2008-06-25\kurd.htm



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