The Iraqi Oil Ministry’s New Fave Five

Nick Turse

On June 19th, the New York Times broke the story in an article headlined “Deals with Iraq Are Set to Bring Oil Giants Back: Rare No-Bid Contracts, A Foothold for Western Companies Seeking Future Rewards.” Finally, after a long five years-plus, there was proof that the occupation of Iraq really did have something or other to do with oil. Quoting unnamed Iraqi Oil Ministry bureaucrats, oil company officials, and an anonymous American diplomat, Andrew Kramer of the Times wrote: “Exxon Mobil, Shell, Total and BP… along with Chevron and a number of smaller oil companies, are in talks with Iraq’s Oil Ministry for no-bid contracts to service Iraq’s largest fields.”

Finally, after a long five years-plus, there was proof that the occupation of Iraq really did have something or other to do with oil.

The news caused a minor stir, as other newspapers picked up and advanced the story and the mainstream media, only a few years late, began to seriously consider the significance of oil to the occupation of Iraq.

As always happens when, for whatever reason, you come late to a major story and find yourself playing catch-up on the run, there are a few corrections and blind spots in the current coverage that might be worth addressing before another five years pass. In the spirit of collegiality, I offer the following leads for the mainstream media to consider as they change gears from no-comment to hot-pursuit when it comes to the story of Iraq’s most sought after commodity. I’m talking, of course, about that “sea of oil” on which, as Deputy Secretary of Defense Paul Wolfowitz pointed out way back in May 2003, the month after Baghdad fell, Iraq “floats.”

All the News That’s Fit to Print Department

In a June 30th follow-up piece, the Times‘s Kramer cited U.S. officials (again unnamed) as acknowledging the following: “A group of American advisers led by a small State Department team played an integral part in drawing up contracts between the Iraqi government and five major Western oil companies…”

In addition, he asserted, this “disclosure… is the first confirmation of direct involvement by the Bush administration in deals to open Iraq’s oil to commercial development and is likely to stoke criticism.” This scoop, however, reflected none of the evidence — long available — of the direct involvement of Bush administration and U.S. occupation officials in Iraq’s oil industry. In fact, since the taking of Baghdad in April 2003, the name of the game has been facilitating relationships between Iraq and U.S.-based and allied Western energy firms when it came to what President Bush used to delicately call Iraq’s “patrimony” of “natural resources.”

For instance, almost a year ago, the Washington Post‘s Walter Pincus drew attention to a call by Bush’s Commerce Department for “an international legal adviser who is fluent in Arabic ‘to provide expert input, when requested’ to ‘U.S. government agencies or to Iraqi authorities as they draft the laws and regulations that will govern Iraq’s oil and gas sector.'” The document went on to state that, “as part of a U.S. government inter-agency process, the U.S. Department of Commerce” would be “providing technical assistance to Iraq to create a legal and tax environment conducive to domestic and foreign investment in Iraq’s key economic sectors, starting with the mineral resources sector.”

This was no aberration. Back in March 2006, for instance, the U.S. Army issued a solicitation for a two-year contract “to allow any organization or entity to support IRMO [Iraq Reconstruction Management Office] (U.S. Embassy Baghdad) to deliver an effective capacity development program utilizing predominantly U.S. and European firms, universities, institutes and professional organizations for personnel within the Iraqi Ministry of Oil…” This was to include participation in “development programs” offered by “private companies,” long-term development through “commercial training entities in the United States and Europe for Oil and Gas specialists from the Ministry of Oil,” and the implementation of “joint government-industry activities.” Translated out of bureaucratic contract-ese, this meant that the U.S. would pay for programs to, among other things, enhance relationships between the Iraq Oil Ministry and… you guessed it… foreign firms.

Translated out of bureaucratic contract-ese, this meant that the U.S. would pay for programs to, among other things, enhance relationships between the Iraq Oil Ministry and… you guessed it… foreign firms.

In October 2006, the Department of Commerce (DOC) put out a call for experts that was nearly identical to the later solicitation discovered by Pincus. They were to aid a program facilitating “the creation of a legal and tax environment conducive to domestic and foreign investment in Iraqs [sic] key economic sectors, starting with the mineral resources sector” and provide “expertise to DOC, to other [U.S. government] agencies, or to Iraqi authorities on creating a legal and tax environment conducive to domestic and foreign investment in Iraqs [sic] oil and gas sector.” Such an individual would, in fact, act “as a liaison between [the DOC’s technical assistance arm] and key stakeholders in Iraq (such as Iraq’s Ministry of Oil, or the oil authorities in Kurdistan).”

In fact, the U.S. Trade and Development Agency notes that, in 2006 and 2007, it funded a “$2.5 million multifaceted training program for the Iraqi Ministry of Oil” to “provide critical knowledge transfer and establish long-term relationships between the U.S. and Iraqi oil and gas industry public and private sector representatives.”

It’s worth recalling that Iraq’s oil bureaucrats, about to receive such “critical knowledge” and “expertise,” were not exactly neophytes in the world of oil management. They had effectively managed the Iraqi oil industry from the time the five oil majors now slated to receive those “service contracts” were tossed out of Iraq, when its industry was nationalized in 1972, until the invasion of 2003. They had kept the country’s oil infrastructure going even after the disaster of the First Gulf War of 1990-1991, even through all the desperate final years of sanctions against Saddam Hussein’s regime…