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    Sunday, July 30, 2006

    Arabian Nights - A n new old story .

    US Energy Secretary Samuel Bodman (68, ex Fidelity Investments, ex Treasury and at Energy since 31/1/2005, grandfather 8 times over) was in Iraq last week to chew the fat with Iraqi Oil Minister Hussein Al-Shahristani (see pic). Together they met representatives from oil companies such as ExxonMobil, Chevron, ConocoPhillips, Marathon, BP and Shell Oil which the sharp eyed readers will have nticed are all headquartered in the USA.(For nit pickers , since "taking over" Amoco, rendering accounts in US$, BP is effectively a US company see BTC pipeline)

    The intention was to discuss possible joint ventures and a new hydrocarbon law that would regulate the critical energy sector throughout the country. A few notes about the present situtation are worthy of note.

    1. More than 250 Oil Ministry officials, workers and security guards have been assassinated since the fall of Saddam Hussein's regime in 2003, according to the Oil ministry.

    There have been over 300 attacks on Iraqi oil fields in the last three years, according to Iraqi government figures.See website Iraqi Pipeline Watch fro details ov every strike, costs, deaths etc.,

    June 8 2006 (The day al-Zarkawi (?) was killed. Gunmen in Baghdad kidnapped the director general of the State Company for Oil Projects, Muthana al-Badri in Aazamiya, northern Baghdad.he had worked for the company all his life and took over at the fall of Saddam Hussein.

    4. Gunmen in vehicles resembling those used by Iraqi security forces kidnapped the president of one of Iraq’s state-owned oil companies in Baghdad on Sunday 16th July 2006 in the afternoon, an Oil Ministry spokesman said. Adil Mohamed al-Qazaz, the president of the Northern Oil Company, was abducted at about 3:30 p.m. local time after gunmen in two vehicles forced his car to stop and assaulted his bodyguards, said Aseem Jihad, the Oil Ministry spokesman. Mr. Qazaz had just left a meeting at the ministry.

    5. This was before the car bomb that detonated today (30/7) in Kirkuk in the previously untouched Arafa Naftiya area, a predominantly Christian neighborhood containing the headquarters of the Northern Oil Company and foreign consulates which killed two and wounded 6

    After their meeting, Al-Shahristani said that oil company representatives offered their advice and assistance for plans on a hydrocarbon law that will be introduced to the Iraqi Parliament for voting at the end of this year. Al-Shahristani , educated inToronto, a nuclear scientist, Shia, married to Canadian Bernice Holton, improsned in Abu GHraib by Saddam and escaped at the time of the Gulf War - In an interview broadcast on the CBS program 60 Minutes in February, 2003, he claimed over 100 Km of tunnels with stockpiles of were hidden in an unfinished subway snaking below Baghdad, although he had never seen it. ...but then neither has anybody else. He is also said to have turned down the job of PM.

    Bodman has been touting this law (his reason for being there) as a way for Iraq to attract US$20 BN. (Any big number you can think of will do here Ed.) in foreign investment that is needed to increase Iraqi oil production. This magic piece of Western inspired legislation engineered by the finest lawyers the major oilcos can assemble, is claimed will impact the worlds oil market by improving confidence (?) in Iraqs energy sector. Al-Shahristani told reporters that although Iraq has not negotiated joint ventures with companies to begin work in specific oil fields, he said that some contracts could be signed before the hydrocarbon law is voted on by Parliament.

    Which may appear a novel way of introducing legislation to give away control over the country's resources - but no doubt one the oilcos are used to.

    The Department of Energy (DOE) has said that the Iraqi Oil Ministry makes its decisions independent of the United States, (Ho! Ho! Ho!) apart from helping Iraq draft the hydrocarbon law. The DOE said it simply provides technical experts and will be pursuing joint projects with the Iraqi energy ministry. (Leaving it to Mr Alekperov and LUKoil to actually train Iraqis in Russia to learn for themselves which they have been doing for over 2 years).

    Iraq, is said to be currently producing 1.9 million barrels of oil per day (viz pre-war oil production level of 2.6 MBRD) hopes to boost production to 3 MBPD by the end of the year, said Al-Shahristani.(He was not evidently hallucinating when he said this, but then he didn't specify which year he was referring to, but it certainly began with a 2)

    The oil minister ambitiously projected that Iraq could produce up to 4.5 million barrels per day in the next five years and that it could be the second largest producer of oil in fifteen years.

    Bodman added (sensibly it looks from here) a note of caution and described such projected figures as "ambitious." (A variant spelling for Bullshit)The US DOE has estimated that at its current output, Iraq is still far under its pre-war oil production level of 2.6 million barrels per day. (Although any figures are wrong because ofunknoen levels of theft, corruption etc.,)

    To put this meeting in perspective it is useful to remember previous views on oil production in Iraq.

    1. The Department of Energy (DoE), stated with cocksure confidence in late 2002 that, given the investment (presumably by US oil co’s), Iraq could quickly double its production from the then-daily level of 2.5 million barrels to 5 million barrels or more.

    2. Oil would not only flow, so would the money – enough to pay for the trouble of getting there to steal it. "We can afford it," White House economic adviser Larry Lindsey said of the planned US invasion, because rising Iraqi oil output would invigorate the US economy.

    He told the Wall Street Journal in September 2002 "When there is regime change in Iraq, you could add 3 to 5 million barrels [per day] of production to world supply."

    3. "Successful prosecution of the war would be good for the (Iraqi) economy," said the then deputy secretary of Defence Paul Wolfowitz to a congressional panel, "Iraq oil revenues could bring between $50 billion and $100 billion over the course of the next two or three years. We're dealing with a country that could really finance its own reconstruction, and relatively soon."

    (This guy is now in charge of the World Bank !)

    No doubt the "representatives from oil companies such as ExxonMobil, Chevron, ConocoPhillips, Marathon, BP and Shell Oil." listened, took notes on crisp yellow legal pads with their sleek fountain pens, tapped at their Blackberries, sipped the mint tea that Al-Shahristani favours, and hurried off.

    US Energy Secretary Samuel Bodman is no doubt a decent chap, a loving husband and grandfather - whether he believes all this crap is another matter.

    We should take notice of someone whose feet (and ears) are a bit closer to the ground....

    Asharq Al-Awsat reports - Iraqi Member of Parliament Hadi Al-'Amiri, warning of a possible military coup against the government of Prime Minister Nouri Al-Maliki, Asharq Al-Awsat can reveal.

    Al-'Amiri, who heads the Badr Organization, the military wing of the High Council of the Islamic Revolution said during a speech in the city of Najaf, "There are some who talk about toppling Al-Maliki's government and replacing it with a national rescue government, which we call a military coup government."

    Al-'Amiri adds that this would mean, "the invalidation of the constitution and the results of the elections, as well as returning to the starting point."

    Baghdad and the Sunnis/ Shias are dividing roughly along the Tigris. More troops are being dafted in from the North (said to be 3,00 who were on the way back home to the US) but if the Badr brigades hit the Green zone - which is a nasty water bound cul-de-sac - and swarm it... le disparu Saigon will look like a tea party.

    Especially if simultaneously, some Iranian supplied Fajr missiles get their range from Lebanon and hit Tel Aviv and a lot of it's occupants. That is probably when we find out what was in those monster transports transiting Prestwick and Mildenhall this week - and it's unlikely to be humanitarian aid or medical supplies.

    Those interested in this fascinating topic may wish to refer back to a posting before Lord Patel was ennobled Why Saddam Smiles October 20th 2005


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