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Iraq oil law will head to cabinet after
Kurdish compromise
23.6.2007
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June
23, 2007
BAGHDAD, -- 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.
AP
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