Hakan Aydin

The Independent is reporting that the Iraqi parliament is about to pass a law, which will allow for a large-scale exploitation ofo Iraq’s massive oil reserves, the third-largest in the world, by Western oil companies such as BP, Shell and Exxon.

The Independent says that it has seen the draft of the new law and that the law gives big oil companies such as BP, Shell and Exxon 30-year contracts to extract Iraqi crude and allow the first large-scale operation of foreign oil interests in the country since the industry was nationalised in 1972. Oil industry executives and analysts say the law, which would permit Western companies to pocket up to three-quarters of profits in the early years, is the only way to get Iraq’s oil industry back on its feet after years of sanctions, war and loss of expertise.

Opponents say Iraq, where oil accounts for 95 per cent of the economy, is being forced to surrender an unacceptable degree of sovereignty. Greg Muttitt, a researcher for Platform, a human rights and environmental group which monitors the oil industry, said Iraq was being asked to pay an enormous price over the next 30 years for its present instability. “They would lose out massively,” he said, “because they don’t have the capacity at the moment to strike a good deal.”

Proposing the parliamentary motion for war in 2003, Tony Blair denied the “false claim” that “we want to seize” Iraq’s oil revenues. He said the money should be put into a trust fund, run by the UN, for the Iraqis, but the idea came to nothing. The same year Colin Powell, then Secretary of State, said: “It cost a great deal of money to prosecute this war. But the oil of the Iraqi people belongs to the Iraqi people; it is their wealth, it will be used for their benefit. So we did not do it for oil.”