Western oil firms stage a comeback in Iraq

June 21st, 2008 - 4:49 pm ICT by IANS  

Abu Dhabi, June 21 (IANS) Major western oil firms are now set to stage a comeback in Iraq some four decades after being driven out by Saddam Hussein, WAM reported Saturday quoting media reports. Four oil giants - American ExxonMobil, the Dutch group Shell, France’s Total and British major BP, all partners in the Iraq Petroleum Company, are in talks with Iraq’s oil ministry for no-bid contracts to service the country’s largest oilfields. Among others in the field are Chevron and smaller firms.

The four companies were picked from among more than 40 firms, including several from Russia, China and India, which were denied any contracts despite having signed memoranda of understanding with the Iraqi oil ministry, Gulf Today said.

“No-bid contracts are unusual for the oil industry and the deals being worked out are designed to let the four companies gain a firm foothold in Iraq,” it commented.

Legislation that would open up the country’s oil sector to foreign companies remains stalled in the Iraqi parliament because of disputes among Shia, Sunni and Kurdish parties over revenue sharing and other conditions.

The deals are expected to be announced June 30.

The Iraqi oil ministry has described the no-bid contracts as a stop-gap measure to bring modern skills into the fields while the oil law is pending in parliament.

“Why then was the Russian company Lukoil, which signed a contract for the West Qurna field in southern Iraq, outside Basra, with the Saddam government and is offering free training to Iraqi engineers, denied a similar agreement?” Gulf Today asked.

A consortium of Chevron and Total has been given the ’service agreement’ for West Qurna field.

“Surely, the other bidders also have advanced technology and expertise to do the job in Iraq, but they lack the most vital qualification - being closely wired into the American political establishment,” comments the paper.

US Secretary of State Condoleezza Rice said Washington was not involved in the no-bid oil contracts.

“But then who needs direct US government involvement in the matter when advisers appointed by the US government are determining Iraq’s oil policy?” the paper asked.

“Their role strengthens the conviction among many in this part of the world that one of the reasons that the US went to war in Iraq was to secure the country’s oil wealth for American-led companies which have close links with the Republican camp,” it concluded.

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