Doc's Talk: Business is business:China agrees $3bn Iraq oil deal

Monday, September 01, 2008

Business is business:China agrees $3bn Iraq oil deal

Al Jazeera

Iraq and China have agreed the terms of a $3 billion oil service contract, Iraq's oil minister says, announcing the first major oil contract with a foreign firm since the fall of Saddam Hussein. The deal means China has taken the first opening since the US-led invasion for work on the world's third-largest reserves.

Hussain al-Shahristani, Iraq's oil minister, warned that time was running out for big Western oil firms, which have jostled for years for Iraqi contracts, to seal even the short-term deals that were expected to mark their return to the country.

Iraq and China's state-oil firm CNPC agreed the renegotiated terms of an old deal signed in 1997 to pump oil from the Adhab oilfield, Shahristani said.

CNPC is Asia's biggest oil and gas company.

"Finally we have reached an agreement," Shahristani said after clinching the deal.

Tough bargains

Iraq has toughened the terms, changing the contract to a set-fee service deal from the oil production sharing agreement signed under Saddam.

Iraq needs billions of dollars of investment in its energy sector after years of war and sanctions.

But with high oil prices and strong competition for access to some of the world's
cheapest oil to produce, Iraq has been negotiating from a position of strength.

Under the revised contract, Adhab will produce 110,000 barrels per day (bpd), up from the previous target of 90,000 bpd, Shahristani said.

First output would come in three years, and the field should pump for 20 years, he said.

CNPC would own 75 per cent of a joint venture to be set up for the contract, while Iraq's Northern Oil Company would own 25 per cent, he added. The value of the contract would be reviewed every quarter, he said.

The deal was pending the final seal from both countries' governments.

Hydroelectric deal

China's state hydroelectricity firm also signed a deal to build a new hydroelectric power station in Tajikistan on Wednesday worth up to $300 million officials said.

"The Chinese company undertakes to carry out the design and construction of the Nurobod" power station in eastern Tajikistan, read a memorandum of understanding signed by Sinohydro and the Tajik government.

The deal was signed on the sidelines of a visit by Hu Jintao, the Chinese president, aimed at bolstering economic ties between the two neighbours.

The trade turnover between China and Tajikistan amounted to $283 million last year.

China is already a major player in Tajikistan's road infrastructure, telecoms and electricity sectors.

Iraqi demands

High oil prices have put al-Shahristani in a strong negotiating position [EPA]
Iraq wanted six contracts to boost oil output by 100,000 bpd each to be signed in June and implemented within a year.

Baghdad does not want to extend the end-date for the contracts as it plans to sign long-term deals for the same fields by mid-2009.

"We only have about 10 months left," he said. "It seems more and more unlikely that these technical service contracts can be implemented now in such a short remaining time."

The firms that have been negotiating deals are Royal Dutch Shell; Shell in partnership with BHP Billiton; Exxon Mobil; Chevron with Total.

A smaller consortium of Anadarko, Vitol and Dome had negotiated for another deal but Anadarko walked away this month.

Iraq still aimed to boost output by 500,000 bpd by the mid-2009, Shahristani said.

Iraq pumped around 2.4 million bpd in July, according to a Reuters survey.

A long-delayed draft oil law to set the framework for foreign investment was unlikely to be approved in parliament in the near-future, Shahristani said.

"Different parliamentary blocs still have serious differences about the law," he said. "I have not heard anything new from the parliament to make me expect that the law will be passed any time soon."

But Iraq was going ahead with new deals anyway under existing legislation, he said.

Disputes with the regional government in Kurdistan have hobbled the progress of the law.

There had been no progress in resolving differences between Baghdad and the Kurdish regional government, Shahristani said.

Comment: The USA contracts are exactly where? We have a right to know-now! How come this is not a story in any usa media? I have to to go to Arab media to discover the story?

2 comments:

Anonymous said...: from "usa media" wall street journal, two days earlier:

China Reaches $3 Billion Deal
To Develop Oil Field in Iraq
By GINA CHON
August 29, 2008; Page A10

BAGHDAD -- China clinched a deal to develop an oil field in southeastern Iraq, marking the first major foreign oil contract struck with the Iraqi government since the 2003 U.S.-led invasion.

The agreement, which revives a deal struck between Beijing and the Saddam Hussein regime, calls for an investment of about $3 billion. But the development agreement is a limited, technical-services contract, far less lucrative that the accord originally envisioned in a 1997 deal between Baghdad and China National Petroleum Co.
[Image]
ALI YUSSEF/AFP/Getty Images
Iraq is home to vast reserves of oil but its industry is starved of investment and technical expertise.

Legislation that would govern bigger foreign deals is bogged down in the Iraqi Parliament. And separate negotiations between Baghdad and a handful of Western companies for other, technical pacts have faltered. That makes the Chinese deal the most significant foreign-investment commitment in Iraq's vast but creaking oil industry in years.

The contract is to develop the al-Ahdab oil field in Wasit province. It extends for 20 years after production begins, envisioned in three years, according to an Iraqi Oil Ministry spokesman in Baghdad. The agreement sees oil production in the field climbing to some 110,000 barrels a day. The oil produced from the field will mainly be used to supply a planned power station.

Big oil companies have scrambled to establish a beachhead in Iraq. But oil and politics in Iraq are deeply intertwined, and foreign participation in the industry is highly contentious.

Negotiations over a handful of other technical-services deals between Western companies and Baghdad recently faltered. Such deals are essentially consulting contracts in which the companies are paid fees for their work instead of sharing in profits.
[Moving in map]

Ministry officials had said they hoped to sign contracts with Western companies by the end of June. Now, those talks -- with major oil companies such as Royal Dutch Shell PLC, BP PLC and Exxon Mobil Corp. -- are unlikely to go through, the Oil Ministry said. Spokesmen for the companies declined to comment on specific negotiations.

Write to Gina Chon at gina.chon@wsj.com
RELATED ARTICLES FROM ACROSS THE WEB; 4:41 AM
GS Don Morris, Ph.D./Chana Givon said...: Thank you for reading my blog and for this article-very much appreciated -doc; 7:19 AM

The IDF’s Minorities in Numbers and Pictures

In honor of IDF Diversity Week, we present diversity through numbers and pictures. Each year, more and more Muslims, Christians, Druze, Bedouin and immigrants from around the world take on the responsibility of defending Israel.

MUSLIMS:

Muslim Arab Israelis are not required to draft in the IDF, but there are many who volunteer. In 2013, there were over 200 Muslims serving in the IDF and over 300 in the reserves.

Bedouins:

Bedouins are nomadic Muslims who were in Israel when modern borders were set in place and are now considered Israeli citizens. They are not required to draft but a growing number choose to enlist. In 2012, there were over 1,400 Bedouin Muslim soldiers doing regular IDF service and almost 1,500 in the reserves.

Read more:http://www.idfblog.com/2014/02/27/truth-idf-numbers-pictures/#more-34027

Are you aware that in 2013, Middle class taxes go up-significantly?

In January of next year, the federal income tax rate for middle-class taxpayers is scheduled to rise from 25 percent to 28 percent, and the payroll tax is scheduled to rise from 13.3 percent to 15.3 percent… This drives the marginal tax rate based on the aforementioned three taxes to 48.12 percent. Add in state and local property, corporate, excise, and other state and local taxes, and the percentage of each additional dollar that is taxed hovers around 50 percent… When half of each additional dollar earned is taxed away, taxpayers experience a disincentive to start businesses or expand existing ones. This leads to fewer jobs being created.

Why is HAMAS Inside Tampa Schools?

Clare Lopez

Kelly Miliziano, who teaches history classes at Steinbrenner High School in the Tampa, Florida area apparently thinks it’s perfectly OK to invite a senior official of a HAMAS-affiliated organization into her classroom to discuss Islam with her students. According to local media reports, not only has this been going on for years, but in spite of the civil and criminal proceedings that could result from such reckless negligence, the Hillsborough County school superintendent, Mary Ellen Elia, and the chairman of the school board, Candy Olson, also expressed approval for students under their responsibility to be exposed repeatedly to guest speaker, Hassan Shibly, who is the Executive Director for the Council on American-Islamic Relations (CAIR) in the Tampa area.
More...

Did You Know... Ignoring the Call to Islam will Bring Jihad

‘Conquest through Da’wa [proselytizing] that is what we hope for. We will conquer Europe, we will conquer America! Not through sword but through Da’wa.’
-- Yousef al-Qaradawi , Muslim Brotherhood spiritual leader The Arabic word ‘Da’wa’ means the “call to Islam.” But do not think that Da’wa is the same thing as an invitation to an optional holiday event. The classical Islamic doctrine of jihad mandates that enemies must be given the opportunity to convert to Islam or pay the jizya tax before it is permissible to attack them.
Clare M. Lopez

Who is being discriminated-facts tell the truth

Religious bias

Hate crimes motivated by religious bias accounted for 1,409 offenses reported by law enforcement. A breakdown of the bias motivation of religious-bias offenses showed:

65.4 percent were anti-Jewish.
13.2 percent were anti-Islamic.
9.5 percent were anti-other religion, i.e., those not specified.
4.3 percent were anti-Catholic.
3.8 percent were anti-multiple religions, group.
3.3 percent were anti-Protestant.
0.5 percent were anti-Atheism/Agnosticism/etc.

http://www.fbi.gov/about-us/cjis/ucr/hate-crime/2010/narratives/hate-crime-2010-incidents-and-offenses.

On March 31, 1977, the Dutch newspaper Trouw published an interview

with PLO executive committee member Zahir Muhsein. Here's what he said:

"The Palestinian people does not exist. The creation of a Palestinian state is only a means for continuing our struggle against the state of Israel for our Arab unity. In reality today there is no difference between Jordanians, Palestinians, Syrians and Lebanese. Only for political and tactical reasons do we speak today about the existence of a Palestinian people, since Arab national interests demand that we posit the existence of a distinct "Palestinian people" to oppose Zionism.

For tactical reasons, Jordan, which is a sovereign state with defined borders, cannot raise claims to Haifa and Jaffa, while as a Palestinian, I can undoubtedly demand Haifa, Jaffa, Beer-Sheva and Jerusalem. However, the moment we reclaim our right to all of Palestine, we will not wait even a minute to unite Palestine and Jordan."

In March 1977, Zahir Muhsein, a PLO executive, said:

"The Palestinian people does not exist. The creation of a Palestinian state is only a means for continuing our struggle against the state of Israel for our Arab unity. In reality today there is no difference between Jordanians, Palestinians, Syrians and Lebanese. Only for political and tactical reasons do we speak today about the existence of a Palestinian people, since Arab national interests demand that we posit the existence of a distinct Palestinian people to oppose Zionism."

"For tactical reasons, Jordan, which is a sovereign state with defined borders, cannot raise claims to Haifa and Jaffa, while as a Palestinian, I can undoubtedly demand Haifa, Jaffa, Beer-Sheva and Jerusalem. However, the moment we reclaim our right to all of Palestine, we will not wait even a minute to unite Palestine and Jordan."

The Arab Apartheid

Ben-Dror Yemini
In 1948, the Arab countries refused to accept the UN partition proposal and they launched a war of annihilation against the State of Israel which had barely been established. All precedents in this matter showed that the party that starts the war - and with a declaration of annihilation, yet - pays a price for it. Between 550,000 and 710,000 Arabs fled because of the war and a larger number of 850,000 Jews were expelled or fled from Arab countries (the "Jewish nakba").
Population exchanges and expulsions were the norm at that time, occurring in dozens of other conflict points and affecting about 52 million people. In all the population exchange precedents that occurred during or at the end of an armed conflict, there was no return of refugees to the previous region, which had turned into a new national state.
Only the Arab states acted completely differently from the rest of the world. Instead of assimilating the refugees, they crushed them despite the fact that they were their coreligionists and members of the Arab nation - instituting a regime of apartheid. So the "nakba" was not caused by the actual dispossession, which had also been experienced by tens of millions of others. The "nakba" is the story of the apartheid, oppression, abuse and denial of rights suffered by the Arab refugees at the hands of the Arab countries. (Maariv)

International Law and Military Operations in Practice - Col. Richard Kemp

"Islamist fighting groups study the international laws of armed conflict carefully and they understand it well. They know that a British or Israeli commander and his men are bound by international law and the rules of engagement that flow from it. They then do their utmost to exploit what they view as one of their enemy's main weaknesses. Their very modus operandi is built on the correct assumption that Western armies will normally abide by the rules, while these insurgents employ a deliberate policy of operating consistently outside international law. "

Lost Historical Moments

What Rabin’s last Knesset speech really said:repudiation of a Palestinian state

Rabin ruled out a fully sovereign Palestinian state :

“We view the permanent solution in the framework of State of Israel which will include most of the area of the Land of Israel as it was under the rule of the British Mandate, and alongside it a Palestinian entity which will be a home to most of the Palestinian residents living in the Gaza Strip and the West Bank. We would like this to be an entity which is less than a state, and which will independently run the lives of the Palestinians under its authority.”

Rabin ruled out a total withdrawal from Judea and Samaria and thus a return to the pre-June 1967 borders :

“The borders of the State of Israel, during the permanent solution, will be beyond the lines which existed before the Six Day War. We will not return to the 4 June 1967 lines.”

Rabin ruled out withdrawing form the Jordan Valley:

“The security border of the State of Israel will be located in the Jordan Valley, in the broadest meaning of that term.”

Rabin ruled out uprooting settlement blocs, like the Gush Katif bloc in Gaza (which was subsequently uprooted by former Prime Minister Ariel Sharon):

“The establishment of blocs of settlements in Judea and Samaria, like the one in Gush Katif.

AND

Rabin ruled out removing any settlement before coming to a full peace agreement with the Palestinians:

“I want to remind you: we committed ourselves, that is, we came to an agreement, and committed ourselves before the Knesset, not to uproot a single settlement in the framework of the interim agreement, and not to hinder building for natural growth.”

Rabin insisted on Israel retaining full security control of the borders with Egypt and Jordan, contrary to Israel’s relinquishment of the Philadelphia Corridor on the border with Egypt:

“The responsibility for external security along the borders with Egypt and Jordan, as well as control over the airspace above all of the territories and Gaza Strip maritime zone, remains in our hands.”

Correcting Oslo Myths-Part 2

3) Kuttab laments that the post-1993 Oslo process resulted in a Palestinian Authority "whose ministers and legislators are not guaranteed passage between Gaza and the West Bank ...."

Before free passage or other perquisites, PA leaders were obligated, among other things, to eliminate the terrorist infrastructure in the West Bank and Gaza Strip, end anti-Israeli, antisemitic incitement in schools, mosques, and communications media, and resolve all outstanding issues through peaceful negotiations. They met none of these commitments, sometimes bolstering terrorism and greatly increasing incitement.

4) Kuttab complains that under Oslo the PA got "lightly armed police ---- but no real sovereignty over the land or contiguity between our communities in Gaza and the West Bank."

Oslo agreements repeatedly were revised, regardless of Palestinian non-compliance, until the authorized number of police grew from 8,000 to 40,000. Though they were to be the only armed forces in the territories, Israeli estimates early in the second intifada put the number of gunmen - police, "security services," terrorists, and armed gangs - at 85,000. Their armament reportedly included not only heavy machine guns and rocket-propelled grenades, but also anti-tank and anti-aircraft missiles.

Sovereignty was to be negotiated in the envisioned 1998 "final status" talks - after a five-year period of confidence-building. Palestinian leadership chronically undermined the process. Palestinian terrorism made the 1993 - 1998 Oslo period more deadly for Israelis than the 15 years preceding it.

The United States doesn't have contiguity between the lower 48 states and Alaska and Hawaii; territorial contiguity between the West Bank and Gaza Strip - that is, through the 20 miles of Israeli territory between them - was never promised and would destroy Israeli contiguity.

5) "Palestinians have been made to endure hundreds of checkpoints in the West Bank, an eight-foot wall deep in our territories, and tight Israeli control over borders."

The security barrier is not "deep in Palestinian territories," but rather encompasses less than 8 percent of Judea and Samaria, and is mostly a fence, rarely a wall; the land in question is not "our [Palestinian] territories" but disputed territory to which, according to the authors of U.N. Security Council Resolution 242, Jews as well as Arabs have claims; and there are no international borders, only the 1949 armistice lines with Jordan. Under 242, borders remain to be negotiated. As for checkpoints - like the security barrier and "tight Israeli control" - Palestinian Arabs precipitated these measures themselves. No terrorism and there would be no fence or tight Israeli control and few checkpoints - like before the first intifada.

Correcting Some Oslo Myths

1) In Oslo "Israeli, Palestinian and other world leaders promised that ... Palestinian sovereignty would be solidified."

No, they didn't. The 1993 Declaration of Principles and subsequent Oslo agreements outlined a process by which final status negotiations about the West Bank and Gaza Strip would be reached. The process required an end to anti-Israel terrorism and incitement and a commitment to peaceful negotiations. The PA, Fatah, Hamas, Islamic Jihad, the Popular Front for the Liberation of Palestine, and other terrorist groups, sabotaged the process from the start.

2) "The reality is that, in defiance of U.N. Security Council Resolution 242, which states that it is inadmissible to occupy land by force, Palestinian territories are still under foreign military occupation."
Wrong again. Resolution 242 (1967) does note "the inadmissibility of the acquisition of territory by war." It also affirms the right of every state in the area "to live in peace with secure and recognized boundaries free from threats or acts of force." There were no "Palestinian territories." Jordan occupied the West Bank, Egypt controlled Gaza. Israel did not have "secure and recognized boundaries," so retention of some of those territories was possible under 242. Israel is not a "foreign" military occupier in the West Bank but, pending final negotiations, the lawful military administrator as a result of a successful war of self-defense.

Doc's Talk