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Iraqis Water Down the Draft Oil Law - ASHARQ AL-AWSAT English Archive
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BAGHDAD, (AP) -Iraqi officials said Friday that a U.S.-backed draft oil law will soon be returned to the Cabinet for approval after Kurds agreed to a compromise revenue-sharing measure. But they said many key sticking points remain unresolved — and not even addressed — in the watered-down legislation.

The United States has pressed the government of Prime Minister Nouri al-Maliki to pass the oil law and several other pieces of benchmark legislation as a means of spurring reconciliation among the country’s sectarian and ethnic groups. The law is especially important to Sunni Arabs, who populate regions of Iraq that are largely without oil resources.

Kurds, who have big reserves and active fields in the north of the country, balked at previous draft legislation, believing it did not guarantee them a fair share of the revenue from fields they control or hope to control.

Shiites, who control major resources in the south and who have taken political control of the government after years of oppression under Saddam Hussein’s minority Sunni rule, have been reluctant to share revenues with their former tormentors.

Passage of even a watered-down oil law would allow the Bush administration to point to some progress before the American military leadership reports to Congress on progress in the campaign to clamp off Iraqi violence.

While Sunnis feared being shut out of a share of Iraq’s oil wealth, Kurds were arguing that their share of oil revenues should be given to them directly, bypassing the central Finance Ministry. The bill appears to have resolved that issue with the provision that money will be deposited into a Kurdistan regional account in the central bank.

But other sticking points remained, including who should control untapped lucrative Iraqi oil fields, where estimated oil reserves could reach 115 billion barrels. The draft law suggested that most of these oil fields are to be controlled by a yet-to-be established national oil company, something the Kurds reject.

“An agreement was reached regarding the oil law, but there are some minor things in the annexes that we need to talk about with the central government,” Saleh Khalid, the Kurdish regional government spokesman and a member of the delegation involved in the negotiations, told The Associated Press. He refused to give details.

Oil Ministry spokesman Assem Jihad said the compromise was reached after lengthy negotiations and suggested plans to form a national oil company were open to debate.

“No group is allowed to usurp the powers of the other group,” he said. “The Federal Oil Council, to be headed by the prime minister or his representative, will be in charge of determining the contract mechanisms, specifying the oil fields or projects to be subjected to competition, supervising and approving the contracts.”

The current bill calls for two accounts to be established — one in which revenues from oil exports would be deposited, and another involving customs and taxes.

The central government in Baghdad would take from the accounts what it needs to cover the national budget while the rest would be distributed among Iraqi governates and regions, according to the draft, which was posted on the Kurdish government’s Web site.

The self-governing Kurdish region in northern Iraq would receive 17 percent of net revenue; other available funds would be distributed according to population elsewhere in the country “to meet the needs of the governates not organized as regions,” the regional government said in a statement.

“The distribution of the revenue shall be monthly and automatic, which will achieve a just and fair allocation for every part of the country whether it has oil or not,” it said.

A government adviser said the Cabinet could vote on whether to adopt the measure as soon as Monday after which it would be sent to the Iraqi parliament for final approval.

“The negotiations started with high ceiling demands from both sides, but the keen desire to preserve national interests and the willingness of the central government and the Kurdish regional government to overcome difficulties made it possible to reach the compromise,” said al-Maliki’s aide, Hassan al-Suneid.

Passage of the oil law has become a major issue for the United States, but the Iraqis have missed several deadlines for the bill’s passage.

Al-Maliki’s Cabinet endorsed one version of the oil law on Feb. 26 in what was hailed as a breakthrough, but parliament never took up the measure.

Asharq Al-Awsat

Asharq Al-Awsat

Asharq Al-Awsat is the world’s premier pan-Arab daily newspaper, printed simultaneously each day on four continents in 14 cities. Launched in London in 1978, Asharq Al-Awsat has established itself as the decisive publication on pan-Arab and international affairs, offering its readers in-depth analysis and exclusive editorials, as well as the most comprehensive coverage of the entire Arab world.

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