Yes this is an issue whose time has not (yet) come - militarily, politically, commercially, even legally this is not the time to change the property status of the oil fields. If and when things become "pacified" one would expect oil field privatization to be a very gradual process, so as get the population accustomed to the idea and work out the innumerable compromises.
I gather that a number of transitional models are being tried out in other 3rd world countries with a lot of petroleum sector privatization literature having been written. It would be interesting to hear more on, for example, what was being tried in Venezuela before Chavez (apparently they went pretty far down the road, with well developed plans), or in Mexico, Nigeria, etc. In crude terms (sorry) the models all involve gradually making the state oil enterprise more autonomous (and being perceived less and less as an public asset or even publicly accountable). Likewise, revenues are gradually converted into taxes or payments in lieu of taxes. As the public "feels" less ownership a gradual blend of public\private "partnership" is being introduced in a number of countries.
In Iraq, one transitional model that had been drawn up (I believe it was in the State Dept's Future of Iraq program) was a long term "lease\purchase" arrangement, possibly with the purchase clause not spelled out until several years down the road. By then there would be a (new) group of Iraqi managers and senior technicians who, through an employee shareholder provision, be drawn into supporting a gradual privatization plan. Wasn't something like this drawn up for Venezuela?
Aside from ownership models, Iraq faces two more twists. First, the Kurds naturally want the 2nd largest pool - the northern oil fields around Kirkuk - as their sole hope of establishing independence or major autonomy, hence the effort to move large numbers of Kurdish civilians "back" to Kirkuk; and the Shiis may come to feel the same way about the largest fields which are in the south. The northern ones in particular are interconnected "supergiant" pools, so physical control will be a 'winner take all' situation between Kurds and Sunnis should it come to that. Second, some in the Administration have expressed great concern over giving ANY Iraq govt (or successor entities) access to large amount of oil revenue and have talked of insistence on some sort of "Alaska" model, i.e. bypassing the state and distributing oil revenues directly to the population. (Of course this is for only after the war; right now these same officials need any oil wealth for their own ongoing efforts.)
[BTW, I think it is a safe bet that the French and Russians will NOT wind up owning anything in Iraq; rather look for BP getting concessions in the South.]
Paul
Marvin G writes:
As I recall, there were a number of reasons. When this issue was discussed under Paul Bremmer's Provisional Coalition Authority last year in connection with a series of decrees governing the deregulation of the economy and foreign trade, it was decided to "shelve" the issue of privatizing the Iraq National Oil Company for political reasons, ie. it would reinforce the perception of the Iraqi masses that the US invaded to get its hands on the country's oil. There was also of course the military issue, securing the oilfields against sabotage by insurgents. There was an intertwined economic and diplomatic one: the US oil companies also wanted to develop the fields in conjunction with French, Russian, and other oil companies, who already had concessions in Iraq and knew the terrain, but this awaited a diplomatic solution to the differences between these countries and the US, which in turn revolved around forgiveness of Iraq's foreign debt. And finally there were the legal niceties: various international legal conventions forbade an occupying power from fundamentally altering the economic landscape and plundering the nation's resources. So it was decided to wait until elections were held, a new Iraqi government installed, a constitution drafted, and the country stablized for foreign investment.
So I think it's more appropriate to say the multinationals are against privatizing Iraqi oil - for now.
MG
----- Original Message ----- From: "Jim Devine" <[EMAIL PROTECTED]> To: <[email protected]> Sent: Monday, May 16, 2005 11:42 PM Subject: Re: [PEN-L] Cambodia and Unions
I don't see why you say the oil companies were against privatizing Iraqi oil<
I was only citing what Palast said.
-- Jim Devine [EMAIL PROTECTED] http://myweb.lmu.edu/jdevine
