Iraqi Dinar Revaluation 2013

This is a Declassified Document that was released September 1, 2006 titled "The Future of Iraq Project" by the United States Department of State. I know there will be critics of this post stating that "it is old," well it has been awhile since we invaded Iraq and deposed the brutal dictator Saddam Hussein so yes it is old but I have not seen it on any other Dinar sites. If you are patient and think about the scale of this endeavor for a few minutes. I believe you will reach the conclusion that this had to be put in place long before we invaded the country of Iraq. There had to be a "planning of the work" before the "working of the plan" ever began.

Well this is that plan straight from the United States Government. All of the "mammoth 13 volume study."

I know others have brought this document to light in the past, years ago actually, so I do not want you to presume that I am attempting to claim I am the only one that possess it, far from it, or that I have some "super secrete" contact in the United States Government that "leaked" this to me. I am only attempting to provide access to a document that I have not seen on Dinar sites, or referenced on Dinar sites. Which is the United States Governments Plan for the Future of Iraq, Post Saddam Hussein, and how we planned to conduct the reconstruction of every aspect of the country of Iraq. If you read it you will see that every aspect of the reconstruction of Iraq was studied prior to military action being taken to begin the second Gulf War.









As you can see there is quite a list and all of it is relevant to our investment. However I am not writing my thesis paper in graduate school on this investment in this forum. I am also not trying to convince you that I have the "Holy Grail" that tells us the rate and date.

We will be posting this document in the coming days and also releasing the other sections of this 1200 page Plan.
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I posted this on the 14th of July in this forum and all I did was alter it as to how you now see it posted below on the 20th of July. So which ever member of this site that is "Muffin" on "E's" site take this post of mine to him and see if he can figure out how I first talked about this document on the 14th and he states on the 21st that he has found a document and it just happens to be the one I talk about in this post above. Also ask him if he has located the remaining 1002 pages of the plan that I will be posting in sections in the coming days as it is not a 198 page document as he states it is in total 1200 pages in length.

_________________
We have the wolf by the ears, and we can neither hold him, nor safely let him go. Justice is in one scale, and self-preservation in the other.
Thomas Jefferson, letter to John Holmes, Apr 22, 1820

Future of Iraq "Oil and Energy" Section



A) Regroup, part privatize and retain control

B) Regroup, partner and retain control

C) De-monopolization

oilnenergy.pdf

By following that link above you can view "The Future of Iraq Project" 94 page section on what the concerns were pre-war in Iraq and how the US Government planned to attack the main economic engine of Iraq and get the oil flowing as soon as possible.

And by reading the information below you can see where Iraq stands ( according to the latest data available) in their progress in that endeavor.

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Special Edition
Iraq’s Petroleum Industry:
Unsettled Issues
The Middle East Institute
Washington, DC

Middle East Institute

The mission of the Middle East Institute is to promote knowledge of the Middle East in America
and strengthen understanding of the United States by the people and governments of the
region.
For more than 60 years, MEI has dealt with the momentous events in the Middle East — from the birth of the state
of Israel to the invasion of Iraq. Today, MEI is a foremost authority on contemporary Middle East issues. It provides
a vital forum for honest and open debate that attracts politicians, scholars, government officials, and policy
experts from the US, Asia, Europe, and the Middle East. MEI enjoys wide access to political and business leaders
in countries throughout the region. Along with information exchanges, facilities for research, objective analysis,
and thoughtful commentary, MEI’s programs and publications help counter simplistic notions about the Middle
East and America. We are at the forefront of private sector public diplomacy. Viewpoints are another MEI service to
audiences interested in learning more about the complexities of issues affecting the Middle East and US relations
with the region. The views expressed in these Viewpoints are those of the authors; the Middle East Institute does
not take positions on Middle East policy.
To learn more about the Middle East Institute, visit our website at http://www.mei.edu

Iraq’s Petroleum Industry:
Unsettled Issues

Preface

Iraq has the world’s third-largest oil reserves. However, the development of Iraq’s petroleum sector has been severely hampered by decades of war, sanctions, underinvestment, the exodus of scores of technocrats, and sabotage. Repairing Iraq’s oil infrastructure and expanding exploration, development, and production is of paramount importance to the country’s future.

In June 2009, the Iraqi Oil Ministry embarked on an effort to help meet this challenge by offering service contracts to international oil companies (IOCs) in two rounds of tenders. The essays contained in this special edition of MEI Viewpoints explore the official expectations and current status of the contracts awarded to IOCs.

They also provide a sober assessment of the legal and political obstacles yet to be overcome, as well as sage advice as to how those seeking to invest in Iraq’s petroleum sector can minimize the hazards of doing business there.

MEI wishes to thank Mr. Thomas W. Donovan, who played an instrumental role in all phases of the development of this publication.

Introduction
Thomas W. Donovan
With the recent conclusion of the first and second bid rounds to license foreign international oil companies (IOCs) to operate in specific Iraqi fields, many commentators have predicted that the country is now on its way to meeting the very ambitious 12 million barrel per day (bpd) oil production benchmark. In making such predictions they cite the diminished violence in the nation, the seemingly free and fair 2010 elections, and especially the better organized 2009 bid rounds which granted IOCs the ability to develop petroleum in a profit sharing capacity.

While all of us involved in Iraq want the best for the Iraqi Government and its people- who have endured so much - it is difficult to overlook several major obstacles in the upstream petroleum industry. A viable and dependable upstream production cannot take hold in Iraq without clear and timely resolution of several integral issues. This special edition of Viewpoints, which I am pleased to moderate, seeks to isolate these issues, understand them in a domestic and regional light, and offer pointed assertions by leaders in their field on how to improve the upstream production and domestic off-loading capacity. The stakes could not be higher: the future of stable worldwide petroleum production and the ability to fund a democratic Iraq hang in the balance.

The Pri ze
According to dated publicly available surveys, there are 28 giant fields in Iraq, which hold an estimated 12% of the entire proven global reserves. Discovered as early as the Ottoman Empire, the largest giant field is Rumaila, located near Basrah in southern Iraq. The giant field of Qurna (also called West Qurna or Qurna I & II) is also located in the Basrah Governorate. The Majnoon field in the north is the third largest giant in Iraq. Each of these fields is estimated to be between the 3rd and 9th largest fields in the world.

The extraordinary size of these fields and their highly sustained productivity are due to a nearly perfect combination of a large subterraneous geological structure and a highly permeable reservoir. These special sedimentary properties make the ultimate recovery (ability to extract a high percentage from the giant field) and success rate (defined as the number of successful wells completed as divided by the number of wells drilled) among the highest in the world. Moreover, the proximity of these giant fields to a usable port for offloading via pipeline in Umm Qasr (located on the Persian Gulf in the disputed Shatt al-Arab waterway) is small as compared to other giant fields in the North Slope of Alaska or Central Asia. This proximity to a port, high success and recovery rate, along with the superb geological properties of the petroleum itself, contributes to a highly lucrative prize for any IOC willing to engage in the sizeable risks associated with an Iraqi investment.

Understandably, this prize has brought serious international competition. Of the 21 bidding consortiums involved in the 2009 petroleum bidding, 17 involved Chinese parties. Once added to overall demand from mainland China, Chinese corporate interests are now the largest foreign investor in Iraq and the largest developer and consumer of upstream petroleum in Iraq as well as the largest recipient of petroleum from the Middle East.

Political and Legal Considerations

Notwithstanding the ultimate prize of Iraqi upstream production, there remain several legal and political risks which cannot be ignored. These risks remain, as with everything in Iraq, disproportionately high as compared to other developing democracies. Specifically, such issues as security concerns, Kurdish political disputes, the dubious legal structure of the petroleum regime itself, and legal inconsistencies with the production sharing contracts signed by IOCs in the 2009 bid rounds add to the legal and political risk.

Any discussion of the development of the Iraqi petroleum industry cannot underestimate the differences in legal treatment between the areas of federal Iraq and the semi-autonomous area under the rule of the Kurdistan Regional Government (KRG). Despite the 2005 federal Iraqi Constitution which has ambiguous language to the contrary, the KRG today formulates and governs upstream petroleum production in the provinces under its control; namely Dohuk, Erbil, and Sulamaneiyah. In a possible contravention of law, all licensing, monitoring, and production sharing is conducted by and between the KRG and the IOCs.

The KRG issued a parsimonious petroleum law well before it began production in 2009, granted concessions in a profit sharing capacity with foreign operators, and has today many large international petroleum corporations actively operating within its borders. While the production and development is still in the early stages, the international corporations have a vested interest in the development and further estrangement of the KRG from the rest of federal Iraq. The producing fields in the KRG are smaller than the giant fields in federal Iraq. Granted, the federal government believes that the KRG is overstepping its bounds and cites the clear provisions of the 2005 Constitution in support. However, as these Kurdish political factions are needed to create a workable majority in Iraq’s Parliament and therefore form a federal government, there exists no ultimate deterrence for their actions. In the absence of such, the KRG has aggressively pushed forward in developing, marketing, and exporting its own reserves.

Unlike the KRG, federal Iraq has been acting without a parsimonious oil law since the current sovereign Government of Iraq has been in existence. The environmental and legal underpinnings of upstream production are instead grounded in the laws which remain in force from the previous Saddam Husayn and General Qasim regimes. These authoritarian and socialist structures created a nationalist monopoly on the production, transport, and export of oil, and only allowed the involvement of foreign companies if the Iraqi Parliament specifically allowed such activity (Law 97 of 1967). In the absence of a direct approval by Parliament, and incorporating a strict interpretation of Law 97, each and every IOC in Iraq successful in the 2009 bid rounds would need a specific vote in Parliament to be operating in Iraq legally. If there is no such authorizing vote, their presence is arguably illegal under Iraqi domestic law or operating in an ultra vires capacity. This dubious legal structure has dissuaded many supermajor petroleum companies from investing in Iraq and participating in the bid rounds.

This gap in Iraqi jurisprudence has recently been challenged in federal Iraqi court by former parliamentarian Shadha Musawi. She argues that the Prime Minister and the Oil Minister had begun, without Parliament’s approval, to decide the nation’s petroleum policy through their licensing efforts in the first and second bid rounds.

Musawi’s contentions are that oil policies, contracts, and licenses should be approved in greater concert with the regional governorates (which includes her native Basra Governorate) as well as the federal Parliament. In Musawi’s view, and in a strict and literal reading of Law 97 of 1967, all contracts between Iraq’s Ministry of Oil and any third parties must obtain a separate vote of approval from Parliament to prove binding, legal, and enforceable under Iraqi law. The case is now pending in a Baghdad federal court. Its potential success
on its merits is keenly watched by international observers.

One of the most interesting aspects of the growth in the upstream petroleum production is that internal refining and distribution capacity within Iraq has not developed significantly. Still operating on a pre-war level, the increase in infrastructure development consistent with the sheer massive foreign investment following the bid rounds will undoubtedly grow. The opportunities for foreign investment in this sector will also be large and keenly competitive between American, European, and Chinese interests, among others.

Conclusion

The current chapter in Iraq’s modern history will ultimately be judged by the capacity and pace with which it re-engages its Middle East neighbors and immerses itself in the rapidly changing global economy. While always a steep road to plough, it will be markedly more difficult without a clear resolution of the legal and political issues herein presented as well as the internal political and bureaucratic obstacles which exacerbate the enormous risks associated with any Iraqi investment. Therefore, I am pleased to introduce this special edition of MEI Viewpoints. As always, the authors welcome readers’ contributions and feedback, which undoubtedly contribute to the greater understanding of these issues and how they present themselves in our interconnected world.

http://www.mei.edu/Portals/0/Publicatio ... l%20VP.pdf

_________________
We have the wolf by the ears, and we can neither hold him, nor safely let him go. Justice is in one scale, and self-preservation in the other.
Thomas Jefferson, letter to John Holmes, Apr 22, 1820

This is a Declassified Document that was released September 1, 2006 titled "The Future of Iraq Project" by the United States Department of State. I know there will be critics of this post stating that "it is old," well it has been awhile since we invaded Iraq and deposed the brutal dictator Saddam Hussein so yes it is old but I have not seen it on any other Dinar sites. If you are patient and think about the scale of this endeavor for a few minutes. I believe you will reach the conclusion that this had to be put in place long before we invaded the country of Iraq. There had to be a "planning of the work" before the "working of the plan" ever began.

Well this is that plan straight from the United States Government. All of the "mammoth 13 volume study."

I know others have brought this document to light in the past, years ago actually, so I do not want you to presume that I am attempting to claim I am the only one that possess it, far from it, or that I have some "super secrete" contact in the United States Government that "leaked" this to me. I am only attempting to provide access to a document that I have not seen on Dinar sites, or referenced on Dinar sites. Which is the United States Governments Plan for the Future of Iraq, Post Saddam Hussein, and how we planned to conduct the reconstruction of every aspect of the country of Iraq. If you read it you will see that every aspect of the reconstruction of Iraq was studied prior to military action being taken to begin the second Gulf War.





As you can see there is quite a list and all of it is relevant to our investment. However I am not writing my thesis paper in graduate school on this investment in this forum. I am also not trying to convince you that I have the "Holy Grail" that tells us the rate and date.

My intention is to show you that there is a plan even though at times it appears random and chaotic, and let you read it, if you chose to, and reach your own conclusion.

There was no possible way for Mr. Warrick and his team to anticipate this election debacle nor the economic crash of the last couple of years of the worlds economy nor the rapid development of a possible nuclear Iran, and how that effects the world as a whole today in 2010.

I almost forgot to mention, look on page 21-23 somewhere in there of the PDF and you will see some absolutely terrible photo-copies of Iraqi Dinar, 1 Dinar, 5 Dinar and 10 Dinar notes and even a 1 Dinar coin. Tell me if you think they are new notes or old Dinar notes??? Compare them to the old Saddam notes you can find by doing a "Google" search and look at the old notes on e-bay that are sold as collectors items. See what you think. I will refrain from comment.

So here is a link where you can download the entire document or section by section, which includes the 198 page "Economic and Infrastructure" section:


http://www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB198/index.htm

_________________
We have the wolf by the ears, and we can neither hold him, nor safely let him go. Justice is in one scale, and self-preservation in the other.
Thomas Jefferson, letter to John Holmes, Apr 22, 1820

Security Studies Program Seminar
Preparing for Post-Saddam Iraq: Plans and Actions

Charles Patterson

October 27, 2004

I served as part of the Future of Iraq Project at the State Department. The project was an effort to plan for post-Saddam Iraq.

Immediately after the Gulf War the United States promoted the overthrow of Saddam's Ba'ath regime. This effort failed miserably, as mass graves recently unearthed attest. Maybe the effort failed because we failed to give sufficient support to the Shiites. Regardless, it was a mess.

In the mid-1990s, the United States began to give clandestine support to efforts to overthrow Saddam—efforts many say Ahmad Chalabi led. These efforts also ended in failure and many executions.

In 1998, President Bill Clinton signed the Iraq Liberation Act into law. The President said that he wanted Iraq back in the family of nations as a free state. He rejected the idea that Iraq's history and ethnic mix made it unsuitable for democracy. Congress budgeted eight million, initially, to organize the effort to overthrow Saddam. President Clinton and everyone else supported regime change; the question was how to get there.

It soon became clear that just supporting Chalabi's Iraqi National Congress (INC) was not going to succeed. There were a large number of groups of all sorts willing to discuss either efforts to unseat Saddam or to plan for his absence. A partial list follows:

The Iraqi National Congress
The Free Officers Movement
The Iraq Foundation
The Iraqi National Accord (Allawi's group)
The Iraq National Movement
Dawa (an extreme Shiite group involved in terrorism in the 1980s))
Kurd groups, the Kurdish Democratic Party (KDP), Patriotic Union of Kurdistan (PUK).
The Assyrian Democratic Movement
Alliance of Iraqi Tribes
New Eden (an environmental group committed to the restoration of Iraq's marshlands)
The Mujahedeen Khalq (an anti-Iranian group listed by the State Department as a sponsor of terrorism)

The Bush administration kept the effort to overthrow Saddam and the effort to plan for his aftermath separate. The plan that became the Future of Iraq Project began as an effort to bring these groups together to plan for the aftermath. Initially, the aim was to keep the US government minimally involved. The Middle East Institute, a Washington think tank ran the initial meetings.

But the internal battling among the groups was too much for the Institute. Responsibility fell to the State Department. A small group of people had the lead.

It's important to note that the people who did this planning were not being cynical. The objective was to plan for Iraq after the transition. The assumption was that Saddam's exit would be violent and that there would be a period of transition. We were not planning for the transition.

We formed seventeen Iraqi working groups. The vast majority of the participants were exiles, many ex-Ba'ath, especially the military ones. Most of the planners had been abroad a long time. We sought out professionals and a cross section of interests and groups to get an informed consensus. US government experts, industry experts, and experts from think tanks were involved.

The groups were: Transitional Justice, Public Finance, Public Outreach, Democratic Principles, Water, Agriculture and the Environment, Defense, Local Government, Economy and Infrastructure, Civil Society, Transparency and Anti-Corruption, Education, Refugees, Free Media, Foreign Policy, Oil and Energy, and Cultural Heritage.

Here's how the groups worked. Each had ten to twenty Iraqis and two to five international experts. We designed the groups to be heterogeneous. Each was moderated by State Department officials. There were observers there from other government agencies, including the Office of the Vice-President. Often these were senior experts. They took an advisory position. Contrary to some reporting, officials from the Joint Chiefs of Staff and the Office of the Secretary of Defense participated. However, they came less and less in early 2003 as the Defense Department began its own planning.

While State ran the groups, the goal was to give the Iraqis as much power as possible, in part by creating subgroups. In many cases the planning was very detailed, for instance, on the electricity system.

Planning began in October 2001 in State and at the National Security Council. The meetings began in spring 2002 at the Middle East Institute and quickly came to State.

Most of the groups met and produced plans. The groups focused on technical matters—water, agriculture, and the environment, oil and gas, public health, and even the legal group—had more success than those focused on more political matters. The Foreign Policy group never met due to politics. The Cultural Heritage group never met because of timing.

The Democratic Principles group only met once. It concluded that Iraq must be treated more like Japan or Germany than Afghanistan. That meant not a long military occupation, but a long-term commitment of US resources, and a truly democratic government.

The Defense Policy working group meet twice and reached broad-based consensus positions. It was agreed that retraining the military was essential. It was assumed by all that the military would not be disbanded. No one favored that. The consensus was that while it was essential to vet and dismiss some officers, the military was needed to preserve security. There was disagreement on how centralized the military should be, with the Kurds pushing for less centralization. Some younger former officers wanted retraining in human rights and the rule of law, while older former soldiers resisted this.

All of this begs the question: what the hell happened?

One failing of the project was that State, perhaps due to insularity, did not insist that other key agencies, DoD, CIA, and NSC, be forced to buy into the planning. A cynic might say that plan was only given to State to distract it from the plan to invade and occupy Iraq.

The primary problem was lack of coordination of US government agencies. In January 2003, the Defense Department opened a Reconstruction and Humanitarian Affairs office for Iraq. This group was staffed strictly by DoD personnel, probably more due to insularity than interagency fighting. State Department officials were only initially invited to these meetings.

At the end of 2003, an Iraq transition planning team was created, with the task of planning the move from Coalition Provisional Authority (CPA) rule to Iraqi sovereignty and a US embassy. This team was run by a General. He quickly realized that he needed help and demanded and got State and NSC participation. The result was a massive effort, which worked, in the sense that transition was achieved smoothly.

The Future of Iraq Project needed NSC direction from the beginning. The White House needed to buy into planning, which it did not. The key failure was a lack of sharing of knowledge and information across the government.

The State Department shares responsibility for the failure we see today in Iraq with DoD, the NSC, and the White House. More planning was needed than the Future of Iraq Project, even had the plans been heeded.

Charles Patterson is a retired career Foreign Service Officer with extensive experience in the Middle-East. He served in Beirut, Tel Aviv, and other posts. He participated in diplomatic efforts associated with Operation Desert Storm and the Middle-East peace process. He headed UN Security Council peacekeeping efforts for the State Department, and worked recently on Libyan disarmament.

Rapporteur: Ben Friedman




http://web.mit.edu/ssp/seminars/wed_arc ... terson.htm

_________________
We have the wolf by the ears, and we can neither hold him, nor safely let him go. Justice is in one scale, and self-preservation in the other.
Thomas Jefferson, letter to John Holmes, Apr 22, 1820

* MARCH 4, 2010, 7:09 P.M. ET


America and the Future of Iraq

Iraqis want continued security cooperation and cultural exchanges, but they'd like less U.S. interference in their politics.

By AHMAD CHALABI

The Baathist regime that ruled Iraq from 1969 to 2003 was a fascist, terrorist dictatorship based on racism, violence, oppression and genocide. Through our constitution and our duly elected parliament, the Iraqi people have pledged never to allow the nightmare of Baathism to return. Despite recent intemperate comments and interventions by some senior American officials, we will keep that pledge and enforce the rule of law.

In that spirit, Iraqis of all parties and confessions are enthusiastically competing in the March 7 national elections. They do so encouraged by United States policy as stated by President Barack Obama in his January State of the Union Address: "[W]e are responsibly leaving Iraq to its people."

The Obama policy is the long-awaited fruition of Iraq's liberation after seven years of ill-conceived occupation. Such clarity concerning U.S.-Iraq relations is welcome, and Iraqis eagerly embrace the challenges and opportunities of independent democratic government.

Iraqis also look forward to a new strategic partnership with the U.S. built upon shared ideals and interests. Such a partnership will take account of U.S. security interests but will not be based on them alone.

Iraqis are patriots committed to the defense of their country's sovereignty and territorial integrity. Their security concerns are purely defensive, and there is agreement among all parties that long-term, transparent security cooperation with the U.S. is in Iraq's interests. At the same time, we refuse any security formulation that places Iraq in conflict with its neighbors. Iraq will never again become a battleground for proxy wars.

Instead, Iraq aspires to be a meeting place for democratic interests in the region. The historic and costly liberation of Iraq by the U.S. and coalition forces demands no other outcome. And it is in this effort that U.S. assistance to Iraq is most desired.

Financial aid is not requested; it is time we Iraqis learn to stand on our own feet and budget our own resources. But in areas like education, the rule of law, health care, labor unions, agriculture, management of water resources and cultural exchange, we still need help.

The institutions that make your civil society so strong—such as universities, legal and judicial societies, and medical centers—should be integral to the new foundation of U.S.-Iraq relations. Contacts must take place across the broadest possible range of U.S. and Iraqi institutions.

For too long, the people of the Middle East have been relegated to interactions with the limited foreign policy and intelligence elite in the U.S. political establishment. Iraq is an opportunity to break this tradition.

More than two million Americans have served in two wars in Iraq. It is our hope to build upon this base of commitment and knowledge. Person to person, not official to official, is the path to a permanent friendship between our two peoples.

We are proposing the creation of a regional alliance among Iraq, Turkey, Syria and Iran to bring together our geographic, economic, water and oil resources into a coherent framework. Our region has been plagued by secret wars, ethnic conflict and acts of terror sponsored by these states against each other during the past half century. It is time to put this behind us.

This alliance would be of benefit to the entire Middle East and a strong bastion against Islamic extremism. Such a treaty would also address the failure of the Arab security structure that has required the U.S. to deploy massive force to protect states in the region.

It could be an effective vehicle in resolving the Iranian nuclear energy issue as well, opening a new phase in international politics that could profoundly change the mindset of Middle East decision makers, especially in Iran. It is in the interest of the U.S. to look favorably on such an alliance, despite the fears that some may have of such a structure. There were also those who feared the creation of the European Union.

Though we are grateful for our liberation, Iraqis intend to exercise our legitimate freedom of action in a complex diplomatic and security environment. Those outsiders who seek conflict with Iran or who wish to bind Iraq to the unstable military dictatorships, corrupt oligarchies and despotic monarchies of the region will find no support here.

We call upon the United States to support us in our democratic journey. Recent attempts to interfere in Iraq's constitutionally mandated elections are counterproductive and short-sighted. The U.S. should recognize the leadership that will be freely elected on March 7 as the legitimate government of Iraq. Attempts to interfere in the formation of this government would lead to disastrous delay.

U.S. opposition to Ibrahim Jaffari's selection as prime minister in 2006 created a five-month vacuum promptly filled by foreign-inspired and financed violence. Let's dramatically reorient U.S.-Iraq relations away from military and intelligence agency-led operations to a more open and balanced relationship.

In the Iraq Liberation Act of 1998, passed overwhelmingly by Congress and signed by President Clinton, the U.S. committed itself to the forcible liberation of an oppressed people and to assistance in the formation of a new government. That mission has been fulfilled to the everlasting credit of the American people and with the gratitude of Iraqis. Now, as President Obama has stated, it is up to the Iraqi people. All we ask is the opportunity to move forward on our own as we see fit.

Mr. Chalabi is a candidate for parliament in the Iraqi elections.

http://online.wsj.com/article/SB1000142 ... 31834.html

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Mr. Chalabi is mentioned in the "Future of Iraq Project" as a possible candidate for PM of Iraq. I believe the United States came to the conclusion that he was a little too radical for their taste.

_________________
We have the wolf by the ears, and we can neither hold him, nor safely let him go. Justice is in one scale, and self-preservation in the other.
Thomas Jefferson, letter to John Holmes, Apr 22, 1820

Incredible effort of research, Todd! Thank you so much for putting it in perspective!

_________________
Salud, l'amor y dinero, y el tiempo para casarlos.
Health, love and money, and the time to enjoy them.

After watching Enor try to take credit for Todd's hard work, from now on his hard work will be available to registered members only. It seems being a nice guy and leaving the news forums open to guests was a mistake on my part.

Todd I appreciate all your hard work, and it will show as we release the articles you have uncovered over the last few weeks and which we will be posting over the next few days

_________________
Above all, we must realize that no arsenal, or no weapon in the arsenals of the world, is so formidable as the will and moral courage of free men and women. It is a weapon our adversaries in today's world do not have.
Ronald Reagan

Rob AKA Grumpy



You can always skype me ... skype name is "Grumpysmyname "

Iraq’s Oil Bid Rounds: Politics and Pitfalls

Saifaldin D. Abdul-Rahman

The first rounds of bidding to develop Iraq’s oil fields were perceived to have been a failure because only the BP-led consortium accepted Iraq’s bid parameters. However, the second round - with seven groups of international oil companies (IOCs) eventually signing contracts to develop fields and two more deals from the first round signed - was a success. This represented a major breakthrough not only for Iraq (particularly because the terms negotiated are very favorable to the host government), but also for Iraqi Oil Minister Husayn Shahristani, who almost singlehandedly pushed the licensing round policy. Nevertheless, some potential problems lie ahead.

The Contracts

The major fields and the companies that will develop them are:
• Rumaila - BP / CNPC
• Qurnah 1 - ExxonMobil / Shell
• Zubair - ENI / Oxy / Kogas
• Majnoon - Shell / Petronas
• West Qurnah 2 - Lukoil / Statoil

While these fields represent a majority of Iraq’s discovered and producing acreage, it is important to point out that most of the fields awarded are located either in Basra Province or one of the surrounding southern provinces. This has several noteworthy implications. First, the residents of these provinces will be looking to the oil companies to provide jobs and to return some of the oil production earnings to them. Yet, contrary to the residents’ perceptions, the contracts are structured so that the companies will merely improve production, leaving all of the other financial details to the central government. Furthermore, the Iraqi central government wants to limit the amount of money that is allocated to these oil-producing provinces in favor of federal projects.

Potential Pitfalls

Discontent may spread among the residents of Iraq’s oil producing provinces, who are likely to feel cheated not only by the federal government but also by the IOCs. In fact, this scenario has already started to play out at Alahdab field, where local residents say that the Chinese have not hired anyone locally and have brought in their own workers.

The persistence or intensification of this discontent is problematic at two levels. At the micro level, the disgruntlement could lead to instability, as has occurred in the Niger Delta region of Nigeria. At the macro level, the issues are more numerous and complex. At the top of the list is the absence of a legal framework for apportioning the revenues accrued from oil production. Impeding efforts to establish this framework are the competing concerns of Iraq’s three main ethnic/sectarian groups: the Sunnis, who still feel that they have no stake in the new Iraq or its oil; the Shi‘a, who feel that they do not receive enough of the oil revenues; and the Kurds, who are wrangling with the central government over their rights to produce and sell oil. This contention over the hydrocarbons law and revenue sharing stems from the fact that there is not yet an agreed upon social contract binding the state together. Put differently, Iraqis have yet to agree on the most fundamental of state functions and where sovereignty lies. The stakes will only be higher as oil revenue begins to increase and as some regions and provinces begin to develop more rapidly than their neighbors. Whether they know it or not, many
of the major oil companies are now at the center of this potential maelstrom.

The second major issue is what is likely to be a disparity between promises and results. Iraq has embarked upon one of the most ambitious oil development plans in history. Iraqi Oil Minister Husayn Shahristani has declared that Iraq’s production would reach six million barrels per day (bpd) within three years and over ten million bpd within seven years. Most analysts do not believe that these goals can be attained. However, setting such overly ambitious goals risks creating unrealistic expectations which, if unfulfilled, are apt to cause peoples’ confidence in the central government to erode. Some political groups (e.g., the Sadrists) might exploit the situation by fomenting unrest in order to undermine establishment politicians.

Setting unrealistically high oil production goals also unnecessarily antagonizes Iraq’s neighbors, particularly Saudi Arabia and Iran, adding a new dynamic to the already complex relationships between the three countries. Were Iraq to reach the six million bpd threshold, it would begin to challenge Saudi Arabia’s role as OPEC’s leading producer. Reaching that threshold also would complicate Iraq’s relationship with other OPEC members, which might seek to limit Iraqi production because of price concerns. Whether Iraq will accept such limitations, given the years of sanctions and lack of investment in the oil sector, is an open question.

Equally uncertain is the role that Iran might play should the situation in the Gulf deteriorate. For example, in the event of a military strike against Iran, the possibility of Iranian retaliation against Western oil interests (i.e., oil companies operating near its border) cannot be ruled out.

Finally, Iraq has yet to finalize all of the legal frameworks associated with signing the development contracts with the IOCs. Nor do its laws adequately address some of the questions raised in the Iraqi Council of Representatives.

What if a new prime minister or Council of Representatives seeks to change or dissolve the contracts that have already been signed? This issue is particularly important now that the Sadrists have a significant bloc in the Council and historically have sought to undermine the Oil Minister and the contracts he promulgated, which they believed were not in Iraq’s best interests.

The Way Forward

While the aforementioned issues are numerous and complex, international oil companies can take steps at the local level (i.e., in Iraq’s southern provinces) and Iraq’s central government can adopt measures at the national level to address them. The central government must initiate an education campaign highlighting the role of the IOCs in Iraq and the need for the technology and investment they bring in helping to develop Iraq’s fields. This must be coupled with a transparent policy that spells out precisely how much of the revenues will be returned directly to the producing provinces. The IOCs can, and should, help Iraq reach this target, not by directly talking to Iraq’s government, but by lobbying their own governments to push Iraqi leaders and the United Nations to draft such a policy and widely disseminate it. Iraq’s constitution stipulates that provinces which previously had been unfairly deprived of resources could be compensated. Applied judiciously, this provision could be used to placate both the southern provinces and the Sunni provinces, which, since 2003, have been deprived.

In addition to a transparent policy on revenue distribution, the federal government should clearly outline an energy strategy for the country that includes the development of the energy sector and the surrounding infrastructure. This would help stimulate construction in the provinces where oil is being produced, which in turn could alleviate some of the popular discontent.

The oil companies have already done some things right in training Iraqi oil engineers on new technology outside Iraq. This needs to turn into a comprehensive program to develop a cadre of local technocrats who can be genuine partners for the IOCs in the years to come. Such a program would involve identifying talented students, offering them scholarships to study engineering and other fields needed for Iraq’s upstream and downstream oil development, and enabling them to gain hands-on experience with the IOCs themselves. The IOCs must ensure that they do not become benevolent foundations, which would only engender more problems. They should target projects and sectors that would aim both to quell discontent and to serve their interests where they operate.
While the situation in Iraq is fraught with many pitfalls and dangers, there is a huge potential to create model policies which, if developed and implemented effectively, could mitigate many of them. The Iraqi government and the major oil companies operating there would be well advised to look beyond the narrow view of oil development and think of this as a broad step towards better institutions and a more stable state.

http://www.mei.edu/Portals/0/Publicatio ... l%20VP.pdf

_________________
We have the wolf by the ears, and we can neither hold him, nor safely let him go. Justice is in one scale, and self-preservation in the other.
Thomas Jefferson, letter to John Holmes, Apr 22, 1820

Political and Legal Obstacles in Iraq

Nicholas Skibiak

Since June 2009, the Government of Iraq (GoI) has secured nearly a dozen major oil field technical service agreements with international oil companies (IOCs) after two highly publicized bidding rounds. The deals are seen as the cornerstone of Iraq’s economic development in the coming years. While future oil production has been rather optimistically projected as high as 12 million barrels per day (bpd) by 2020, significant obstacles to the development of the oil and gas industry remain. The country’s infrastructure and skilled labor supply are insufficient, the security situation remains tenuous although much improved, and billions of dollars of investment are needed to facilitate oil field development and exports.

In addition, legal challenges from within Iraq’s fractious political system also threaten to derail development of the oil and gas industry. Central to this issue is the ambiguous legal framework that undergirds Iraq’s oil industry. The absence of any national hydrocarbon law leaves lawmakers and regional governments at odds over procedural issues. A draft law to govern investment and production has been in limbo since 2007 amid
disputes between Baghdad and the Kurdistan Regional Government (KRG) over the proper mechanisms for revenue sharing.

The Iraqi National Constitution as written (particularly Article 112(2) and Article 115) would seem to grant significant power to regional governments to manage hydrocarbon resources, as well as negotiate their extraction. However, the GoI has insisted on the primacy of the central government in negotiating and signing any deals with IOCs.

Furthermore, the process by which the GoI negotiated contracts following the two rounds of oil auctions in 2009 was so centralized around the Ministry of Oil (MoO) that it has drawn wide and vocal accusations of unconstitutionality.

One internal row that has drawn significant publicity, both within Iraq and abroad, is the recent lawsuit filed by outgoing MP Shadha al-Musawi against the GoI, which challenges the constitutionality of the November 2009 BP-CNPC Rumaila deal, and aims to settle the question of whether Iraq’s prime minister, parliament, or provincial governments have the legal authority to finalize oil contracts with foreign firms. Musawi and her allies point to a pre-invasion law (Law 97 of 1967) that required federal oil contracts to be ratified by parliament, and argue that the same requirement should hold for the Rumaila development. The GoI, and the MoO in particular, have argued that the Rumaila and other IOC deals are merely technical service agreements, and thus do not
warrant the same scrutiny as the production licenses envisioned by the 1967 law.

Even if Iraqi courts accept the government’s defense, there are serious questions about how the MoO developed the model contracts upon which the IOC deals were based. It is unclear whether government lawyers and ministers outside the MoO were given the opportunity to scrutinize the contracts before they were signed and declared legally binding. Beyond these specific legal challenges there are quiet rumblings among Iraq’s political factions about the possibility of revisiting the oil contracts once a new government is formed. ‘Iyad Allawi, the leader of the Iraqiyya coalition, has promised a review of the IOC contracts if he becomes Iraq’s next prime minister. Among the most vocal critics are the followers of Shi‘ite cleric Muqtada al-Sadr (the Sadrist Trend), the Fadhila Party, and some other Iraqi nationalists, who have accused the GoI of surrendering the nation’s oil wealth to foreigners, and insist that Iraq can develop its oil resources relying solely on national efforts. Hazim al-Araji, a senior member of the Sadrist Trend, said his party might challenge the legality of the IOC contracts, claiming that there had been “great mistakes” in the negotiations.

It is unclear to what extent the promises to revisit IOC contracts are anything other than political rhetoric. The GoI has quietly assured IOCs that the legality of the existing contracts will not be challenged, but their confidence seems based on the assumption that, given the importance of oil revenues to Iraq’s economic future,
no one would jeopardize the development of the oil industry by suspending field operations or demanding lengthy renegotiations.

Another consequence of failing to pass a national hydrocarbon law has been the lingering dispute between Baghdad and the KRG over oil production and exports in Iraq’s northern provinces. Frustrated by stalled negotiations over a national oil law, the KRG passed its own hydrocarbon investment law in 2007 based on a contentious interpretation of the Iraqi constitution, and began independently issuing production sharing agreements (PSAs) to several dozen smaller IOCs. Baghdad has condemned these PSAs, which have drawn international scrutiny over allegations of impropriety (if not outright corruption). In addition, the central government blacklisted any IOCs operating in partnership with the KRG, barring them from its 2009 oil auctions.

Despite the strong stance taken by the MoO against the Kurdish PSAs, the promise of $2 billion in annual oil revenues eventually compelled Baghdad in June 2009 to allow Kurdish oil exports, but only after negotiating that all revenues would be channeled into the federally managed Development Fund for Iraq, rather than directly to Irbil. At the same time, Baghdad refused to spend oil revenue on contracts it did not have a hand in negotiating, which left the KRG unable to pay its IOCs. After months of squabbling between the governments, which saw Kurdish oil exports halted in October 2009 and restarted in February 2010, the GoI reportedly agreed to cover the costs of foreign firms operating in the Kurdish region, including paying exploration and extraction costs, but not their profits. On February 14, the KRG agreed to publish the details of its PSAs online.

The saga of the Kurdish oil industry reinforces the importance of a national hydrocarbon law in allowing for the full development of Iraq’s oil industry. Without such legislation there is no clear mechanism for dispute resolution and arbitration between the central and provincial governments on issues related to oil investments.
Additionally, at the nexus of the oil law and the KRG dispute rests the central legal and political issue of Iraq’s political future: the long-running dispute over the administration of the ethnically mixed and oil-rich area around Kirkuk. Iraqi Kurds have repeatedly called for the area’s energy resources to be placed under KRG
administration. At a minimum, the Kurds insist that they be included in potential deals on oilfields near Kirkuk, and otherwise have threatened to withhold security for any IOCs working the field. The local Arab population, along with local Turkmen and other ethnic minority groups, are equally insistent that Kirkuk and its oil remain outside the KRG domain. The failure to resolve the issue of the eventual status of Kirkuk and its oil
threatens the prospects for permanent political stability in Iraq.

While the Kurds had hoped to use their seats in the new parliament to win concessions on Kirkuk, an unexpected strong showing by the Iraqiyya coalition may have cut their leverage. Whichever coalitions succeed in forming the country’s next government, oil and gas will dominate Iraq’s political landscape for the foreseeable future. IOCs and international investors are all eagerly waiting to see how events unfold. The GoI must adopt a new national hydrocarbon law, reduce tensions among Sunni and Shi‘ite Arabs, as well as Arabs and Kurds, and reach
a political consensus on the future of Kirkuk and its oil. None of these tasks is easy. Nor will they be achieved in the near-term. While Iraq has made significant progress during the years since the US-led invasion, this progress has been punctuated by periods of intense political and security crises. There is little doubt that conditions in Iraq will continue to improve, but for now we must expect the same staccato march into the future.

http://www.mei.edu/Portals/0/Publicatio ... l%20VP.pdf

_________________
We have the wolf by the ears, and we can neither hold him, nor safely let him go. Justice is in one scale, and self-preservation in the other.
Thomas Jefferson, letter to John Holmes, Apr 22, 1820

The Status of Forces Agreement and Investing in Iraq: Risky Business?

Andrew L. Fono

In spite of ongoing security and political instability, Iraq remains one of the most fertile yet volatile regions in the world for emerging business opportunities, specifically in the petroleum industry. Since the completion of the widely successful “surge” and implementation of the Status of Forces Agreement (SOFA), Iraq has experienced slow but steady improvements in security and economic opportunities in the petroleum sector. As a result, there has been an influx of international companies eager to engage Iraq’s ministries for access to these lucrative markets. However, many challenges lie ahead, including the volatile security environment, the absence of a hydrocarbon law, and an infrastructure (political, economic, and physical) urgently in need of rehabilitation after
years of abuse and neglect under the Saddam regime, as well as further deterioration since 2003. However, two principal questions remain. First, what level of stability and security will be present in the petroleum industry following the withdrawal of US military and security personnel? And second, what safeguards must a company put in place to protect its investment and its employees from the massive political and economic risks involved in establishing an Iraqi presence?

From 2003 until 2008, foreign oil and gas contractors had been able to reduce legal risks in Iraq by operating under certain key privileges and immunities offered under Coalition Provisional Authority (CPA) Order No. 17. These privileges enabled companies to insulate themselves from the Iraqi legal system, while operating in a volatile business environment that was constantly affected by the insurgency. This changed dramatically
with the execution in 2008 of the Status of Forces Agreement between the United States and the Government of Iraq (GOI), which removed most immunities extended to foreign contractors.


The Status of Forces Agreement

The SOFA, which came into effect January 1, 2009, governs the presence of US and related foreign forces in Iraq until their withdrawal, according to a negotiated phased withdrawal period. Article 5 of the SOFA sets June 30, 2009 as the deadline for all US forces to be withdrawn from Iraqi cities, towns, and villages. Article 24 sets December 31, 2011 as the deadline for all US forces to be withdrawn from all Iraqi territory, water, and airspace. Articles 5 and 24 are not hard and fast rules, considering that Article 4 provides that the GOI may request temporary assistance of US forces to support its efforts at keeping the peace and stability of Iraq, including training and supporting the Iraqi Security Forces (ISF).

The SOFA’s greatest impact on companies conducting business in Iraq is that private US citizens, contractors, and their
employees no longer benefit from the limited privileges and immunities offered under CPA Order No. 17. In other
words, contractors are now subject to the jurisdiction of the Iraqi civil and criminal courts, and can be arrested or detained for violations of Iraqi law. In particular, Article 12 eliminates the contractor privileges and immunities offered under CPA Order No. 17. Additionally, the SOFA does not guarantee that any US citizen arrested or detained is entitled to basic due process rights. The US citizen is left entirely in the hands and at
the mercy of the Iraqi judicial system. Thus, contractors conducting business in Iraq must familiarize themselves with the Iraqi judicial system, and its criminal and civil laws. This provision, among others, creates a significant negative impact on foreign companies conducting business in Iraq. For purposes of this essay, we will focus mainly on new changes in the SOFA that impact the civil side of conducting business in Iraq.

Company Registrations

Following the guidelines in the SOFA, all petroleum companies must register to do business in Iraq in order to continue to perform their existing contracts, or enter into new contracts. Moreover, the Technical Service Contracts outlined by the Ministry of Oil (MoO) mandate that all foreign companies maintain a “domestic presence.” While this may take the form of a branch office or limited liability company (LLC), it is a required element of the first and second petroleum bid rounds that companies have a domestic license and comply with the yearly reporting requirements.

Post -Registration Obligations

Once registered as a branch office or LLC, there are further post-registration obligations. For example, branch offices and LLCs involved in the petroleum industry must register for a corporate income tax file with the General Commission for Taxes’ Corporate Tax Department, and an employee must register for an income tax file with the General Commission for Taxes’ Employee Wage Withholding Department. They must also register a social security file with the Social Security Administration of the Ministry of Labor and Social Affairs.

Visa and Residency Issues

Once registered to do business in Iraq, a company can sponsor non-Iraqi employees for visas and residency permits. Visas must be obtained prior to an employee’s arrival in Iraq (except for entry via the Kurdistan Region). Importantly, no visas may be obtained on arrival. All visas are approved by the Ministry of Interior (Residency Directorate) and then forwarded to the Iraqi Embassy in the country of application for finalization. When entering Iraq, foreign employees must report to the Residency Directorate within ten days of their arrival, and must present themselves to the Ministry of Health for an HIV blood test within the same time period. However, stays of less than one week do not require such reporting. Business visas are typically one month in duration. During this time, the employer must apply for a residency permit for resident employees, and obtain all necessary visa extensions. When planning to depart, non-Iraqis in Iraq must obtain an exit visa within six days of their desired departure date. For non-Iraqis who hold a residency permit, the exit visa will include a reentry visa, valid for up to three months from the date of departure. Failure to return within the three months will void the residency. A non-Iraqi will not be able to leave Iraq unless he or she is in possession of an exit visa. Finally, new HIV blood tests are required for non-Iraqis after extended absence from Iraq.

Preparing for Business Investments in Iraq

When considering business investments in Iraq, you must be financially well prepared.

Under the new SOFA, US contractors and employees are no longer protected from Iraqi prosecution and enforcement of Iraqi laws. If your company is considering leaping into business in Iraq, it must register quickly.

This takes time, so do not wait for any grace period to expire. Also, be sure to educate and culturally
sensitize employees to the environment they are entering. When contracting, remember that the Riyadh Convention is the preferred avenue for arbitration, and Jordan is a preferred jurisdiction. Obtain legal advice from US and Iraqi counterparts to ensure your company is in compliance with registration, tax, employment, and visa/immigration laws. You also will wish to establish procedures for your Iraq company and employees to follow in case of arrest or detention so that they know who to call, including their consulates (Iraq is a party to the Vienna Convention). Remember that Iraq is in a transitional phase, and government capacity is low, which can sometimes lead to arbitrary and capricious treatment by government officials. Nothing in Iraq happens quickly, and with an infrastructure that is in such poor shape, there are many instances when phone systems, email, and other methods of communication just are not available. Finally, have patience. The ultimate payoff will be well worth the effort for both your company and for the ultimate success of Iraq as a stable country in a volatile region.

http://www.mei.edu/Portals/0/Publicatio ... l%20VP.pdf

_________________
We have the wolf by the ears, and we can neither hold him, nor safely let him go. Justice is in one scale, and self-preservation in the other.
Thomas Jefferson, letter to John Holmes, Apr 22, 1820

_________________
We have the wolf by the ears, and we can neither hold him, nor safely let him go. Justice is in one scale, and self-preservation in the other.
Thomas Jefferson, letter to John Holmes, Apr 22, 1820

_________________
We have the wolf by the ears, and we can neither hold him, nor safely let him go. Justice is in one scale, and self-preservation in the other.
Thomas Jefferson, letter to John Holmes, Apr 22, 1820

_________________
We have the wolf by the ears, and we can neither hold him, nor safely let him go. Justice is in one scale, and self-preservation in the other.
Thomas Jefferson, letter to John Holmes, Apr 22, 1820

Iraq was the world’s 13th largest oil producer in 2008, and has the world’s third largest proven petroleum reserves after Saudi Arabia and Canada. Just a fraction of Iraq’s known fields are in development, and Iraq may be one of the few places left where vast reserves, proven and unknown, have barely been exploited. Iraq’s energy sector is heavily based upon oil, with approximately 94 percent of its energy needs met with petroleum. According to the International Monetary Fund, crude oil export revenues represented over 75 percent of GDP and 86 percent of government revenues in 2008.







Iraq’s oil sector has suffered over the past several decades from sanctions, and its oil infrastructure is in need of modernization and investment. As of March 31, 2009, the United States had allocated$2.05 billion to the Iraqi oil and gas sector to begin this modernization, but ended its direct involvement as of the first quarter of 2008, and does not have any on going construction projects in the oil and gas sector. The 2009 Iraqi budget allocated $3.2 billion to the Ministry of Oil, a 50% increase from the 2008 base budget, to continue this work.

According to reports by various U.S. government agencies, multilateral institutions and other international organizations, long-term Iraq reconstruction costs could reach $100-billion or higher, of which a third will go to the oil, gas and electricity sectors. In addition, the World Bank estimates that at least $1 billion in additional revenues needs to be committed annually to the oil industry just to sustain current production. Investment by the international oil companies will be aided by the passage of the proposed Hydrocarbons Law, which governs oil contracting and regulation. The law has been under review in the Council of Ministers since October 26, 2008, but has not received final passage.





http://www.eia.doe.gov/emeu/cabs/Iraq/Background.html

_________________
We have the wolf by the ears, and we can neither hold him, nor safely let him go. Justice is in one scale, and self-preservation in the other.
Thomas Jefferson, letter to John Holmes, Apr 22, 1820

Oil
Iraq may be one of the few places left where vast oil reserves have barely been exploited. Reserves
According to the Oil and Gas Journal, Iraq’s proven oil reserves are 115 billion barrels, although these statistics have not been revised since 2001 and are largely based on 2-D seismic data from nearly three decades ago. Geologists and consultants have estimated that relatively unexplored territory in the western and southern deserts may contain an estimated additional 45 to 100 billion barrels (bbls) of recoverable oil.

A major challenge to Iraq’s development of the oil sector is that resources are not evenly divided across sectarian-demographic lines. Most known hydrocarbon resources are concentrated in the Shiite areas of the south and the ethnically Kurdish north, with few resources in control of the Sunni minority (Click HERE to link to oil resources maps). Passage of the proposed Hydrocarbons Law, which would provide a legal framework for investment in the hydrocarbon sector, remains a main policy objective.

The majority of the known oil and gas reserves in Iraq form a belt that runs along the eastern edge of the country. Iraq has 9 fields that are considered “super giants” (over 5 billion bbls) as well as 22 known “giant” fields (over 1 billion bbls). According to independent consultants, the cluster of super-giant fields of southeastern Iraq forms the largest known concentration of such fields in the world and accounts for 70 to 80 percent of the country’s proven oil reserves. An estimated 20 percent of oil reserves are in the north of Iraq, near Kirkuk, Mosul and Khanaqin. Control over rights to reserves is a source of controversy between the ethnic Kurds and other groups in the area.

Production
In 2008, Iraq’s crude oil production under the control of the regional state-owned oil companies averaged 2.4 million barrels per day (bbl/d), up from its 2007 production of 2.1 million bbl/d. However, this is still below its pre-war production capacity level of 2.8 million bbl/d in 2003. About two-thirds of production comes from the southern fields, with the remainder from the north-central fields near Kirkuk. At present, the majority of Iraqi oil production comes from just three giant fields: North and South Rumaila and Kirkuk.

Currently, the Ministry of Oil has central control over oil and gas production and development in all but the Kurdish territory through its three operating entities, the North Oil Company (NOC), the South Oil Company (SOC), and the Missan Oil Company (MOC), which was split off from the South Oil Company in 2008. According to the NOC’s website, their concession and jurisdiction extends from the Turkish borders in the north to 32.5 degrees latitude (about 100 miles south of Baghdad), and from Iranian borders in the east to Syrian and Jordanian borders in the west. The company’s geographical operation area spans the following governorates: Tamim (Kirkuk), Nineveh, Irbil, Baghdad, Diyala and part of Babil to Hilla and Wasit to Kut. The remainder falls under the jurisdiction of the SOC and MOC, and though smaller in geographical size, includes the majority of proven reserves. MOC's oil fields hold an estimated 30 billion barrels of reserves. They include Amara, Halfaya, Huwaiza, Noor, Rifaee, Dijaila, Kumait and East Rafidain.



Development Plans
Iraq’s immediate goal is to boost production by 300,000 bbl/d by the end of 2010 to 2.7 million bbl/d. Iraq’s 10-year strategic plan for 2008-2017 set a goal of increasing crude oil production capacity by 1.5 million bbl/d within 3-4 years, and by an additional 2 million bbl/d to a total of 6 million bbl/d within 10 years. As part of this plan, Iraq planned three licensing rounds. The first was announced June 30, 2008, and included plans to rehabilitate six giant producing fields with reserves of over 43 billion barrels. These contracts were planned to be awarded by mid-2009. The second bidding round was announced in December 2008 for fields that were explored but not fully developed.



Iraq also plans to sign delineation agreements on shared oil fields with Kuwait and Iran. It would like to set up joint committees with its neighbors on how to share the oil. In April 2009, Iraq started work on the Safwan field with Kuwait.

Kurdistan Regional Government Issues
The Kurdistan Regional Government (KRG), the official ruling body of a federated region in northern Iraq that is predominantly Kurdish, passed its own hydrocarbons law in 2007. Despite the lack of a national Iraqi law governing investment in hydrocarbons, KRG has signed oil production sharing, development and exploration contracts with several foreign firms. In addition, more than a dozen contracts signed by the central government with international companies during Saddam Hussein’s regime are being renegotiated or may come under review when Iraq’s oil law and investment framework is in place. In the interim, the Iraqi Ministry of Oil has approved a request from the KRG to send 60,000 bbl/d of crude oil from the Tawke and Taq fields in the Kurdish region to the northern Iraq export pipeline, effective June 2009. KRG Natural Resources Minister Ashti Hawrami expects Kurdish production to reach 250,000 bbl/d by early 2010.

Refining
Iraqi refineries, with a total capacity of almost 600,000 bbl/d, have antiquated infrastructure, and their output does not reflect the current demand mix. Despite improvements in recent years, the sector has not been able to meet domestic demand for most refined products, and the refineries produce too much heavy fuel oil. As a result, Iraq relies on imports for about one fourth of the petroleum products it uses, with total petroleum product consumption averaging about 600,000 bbl/d in 2008.



To alleviate product shortages, Iraq’s 10-year strategic plan for 2008-2017 set a goal of increasing refining capacity from 600,000 bbl/d to 1.5 million bbl/d. Iraq has plans for 5 new refineries, as well as plans for expanding the existing Daura and Basrah refineries.



http://www.eia.doe.gov/emeu/cabs/Iraq/Oil.html

_________________
We have the wolf by the ears, and we can neither hold him, nor safely let him go. Justice is in one scale, and self-preservation in the other.
Thomas Jefferson, letter to John Holmes, Apr 22, 1820