Article 6: Creating the Iraq National Oil Company
B- Its scope of
operations shall include: First: Managing and operating existing
producing Fields mentioned in Annex No. 1, and both the North Oil
Company and the South Oil Company are linked to it.
Article 12: State Participation
B- The Exploration and Production rights with regard to existing producing Fields are hereby given to INOC...
ANALYSIS: Articles 6 and 12 clearly state that the Iraq National Oil
Company only has exclusive rights to the oil fields which are currently
producing oil. Experts on Iraqi oil commonly refer to the following
statistic: "Iraq has 80 known oil fields, 17 of which are currently
producing oil." There is some disagreement over the exact number of
producing fields and which fields they are. However, there is
uniformity in the understanding that approximately 1/3 of Iraq's fields
are currently producing oil and 2/3 are not. Thus, the INOC only has
exclusive rights to 1/3 of Iraq's oil. The remaining 2/3 are open,
under the conditions set out in the law, to private foreign corporate
investment. And, the INOC is even permitted to turn over its fields to
private foreign companies if it so chooses.
Article 9: Grant of Rights
A- The rights for conducting Petroleum Operations shall be granted on
the basis of an Exploration and Production contract. The contract shall
be entered between the Ministry (or the Regional Authority) and an
Iraqi or Foreign Person, natural or legal, which has demonstrated to
the Ministry or the Regional Authority the technical competence and
financial capability that are adequate for the efficient conduct of
Petroleum Operations according to the guidelines of the Federal Oil and
Gas Council and as mentioned in Article 5C Fifth, and in accordance
with the mechanisms of negotiations and contracting stated in Article
10 of this Law.
CHAPTER III: FIELD EXPLORATION AND FIELD DEVELOPMENT OPERATIONS
Article 13: Exploration and Production Contracts
A- An Exploration and Production Contract shall give the holder an
exclusive right to conduct Petroleum Exploration and Production in the
Contract Area.
B- Except if additional time is needed to complete the operations to
assess a Discovery, the exclusive Exploration and Production right
shall be granted as follows:
(NOTE from Antonia - the draft then goes on to delineate a 30-year
period during which the company has exclusive exploration and
production rights).
ANALYSIS: Article 9 states that the right to conduct petroleum
operations in Iraq is open to both Iraqis and foreigners on an equal
footing. Chapter III then delineates the rights of the "holder" of
these contracts. These contracts refer to all of the oil fields not
granted to the INOC. This refers to the 2/3 of known non-producing oil
fields, as well as any and all fields in Iraq that have not yet been
discovered. Thus, this is the provision which turns over at least 2/3
of Iraq's oil to private foreign investment.
Private foreign companies are offered the right to exclusive contracts
to explore for and produce Iraq's oil with contract terms that last
thirty years or more. There is no such thing as a "Exploration and
Production Contract," it is not a recognized contract term. The rights
delineated in this provision and previous provisions are far more
commonly referred to as the rights granted under Production Sharing
Agreements (PSA). The fact that the law is offering PSAs is not
disputed. PSAs are the favorite contract model of international oil
companies and the least favored model of oil-rich countries. Thus,
while Iraq currently has a fully nationalized oil system, the result of
this law, if passed, would be to open 2/3 of Iraq's oil to private
foreign corporate ownership, control, and investment – in other words,
privatize at least 2/3 of the oil regime.
More information is available at
http://PriceOfOil.org
PLEASE SIGN THIS PETITION:
http://priceofoil.org/action
PLEASE TELL THE MEDIA AND CONGRESS THAT YOU KNOW THIS WAR IS BLOOD FOR OIL.
Writings 
And we've been right. The first of the five 
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