Wednesday, November 11, 2009

Exxon's Iraq Oil Contract From Different Perspectives

The name of this blog is What Do I Know? in part to call attention to the fact that we know things, often the same things, differently.  The stories in our heads cause us to focus on different facts in the same situation and interpret the same situation differently.  And to be totally blind to the what others see that conflicts with what we see.

Here are a couple of stories on Exxon/Mobile getting contracts for oil in Iraq.  In respect for the sources, I'll just offer the beginning of each piece. You can click on the links to see the rest of each of these.

From the Guardian:

ExxonMobil wins $50bn contract to develop West Qurna oilfield

The American energy giant ExxonMobil today won the right to develop one of the world's most prized untapped oil reserves, in a $50bn (£30bn) deal that will entrench the company as one of the largest players in postwar Iraq.
Exxon was awarded a contract to extract oil from the West Qurna reservoir near Basra in Iraq's south during an extended tender process that has seen the Iraqi government partner foreign firms in a bid to get its reserves of oil out of the ground as cheaply and quickly as possible.
West Qurna was considered the jewel in the nine Iraqi oil and gas fields up for grabs, with verified reserves of 15bn barrels and a strong chance that exploration will reveal significantly more.
Iraqi oil minister Hussain Shahristani said the contract stipulated a $25bn investment and $25bn more in operating fees. It is also expected to yield up to 100,000 jobs in the impoverished deep south of the country that was heavily blighted by insurgency throughout the past five years.
"Iraq will get great benefits from developing the sector and providing services for the people," said Shahristani in Baghdad's oil ministry. "After decades of oppression and tyranny, Iraq is getting back its riches for this generation and for the next."

Here's the  view from
The Plunder Of Iraq’s Oil
By James Cogan
11 November, 2009
The awarding of development rights over the huge West Qurna oilfield in southern Iraq to Exxon-Mobil and Royal Dutch Shell last Thursday once again underscores the criminal character of the continuing US-led occupation. As the direct result of the Iraq war, major American and other transnational energy conglomerates are now gaining control over some the largest oilfields in the world.
West Qurna has proven reserves of 8.7 billion barrels of oil. Iraq’s total reserves are currently put at 115 billion barrels, though dozens of potential fields have not been explored adequately. Before the US invasion in 2003, rights over West Qurna had been awarded by the Baathist regime of Saddam Hussein to the Russian oil firm, Lukoil. The pro-US puppet regime in Baghdad has torn up all pre-war contracts.
Exxon-Mobil is the first US-based oil giant to benefit. Under the terms of a 20-year contract, Exxon-Mobil and Shell plan to boost daily production at West Qurna from less than 300,000 barrels to 2.3 million barrels per day over the next six years. As well as the Iraqi government compensating the companies for the cost of upgrading the field—which may run as high as $50 billion—they will be paid $1.90 for each barrel extracted, or some $1.5 billion per year. Exxon-Mobil holds an 80 percent stake and Shell the remaining 20 percent.

From the Wall Street Journal:

Exxon-Led Consortium Wins Iraq Oil Contract

BAGHDAD—The Iraqi Oil Ministry on Thursday said it has awarded a consortium led by Exxon Mobil Corp. and Royal Dutch Shell PLC the right to develop the West Qurna-1 oil field, representing the first American-led team gaining access to the country's oil patch.
The pact is the latest in a series of deals Iraq has recently signed or initialed with some of the world's biggest oil companies. Earlier this week, Iraqi officials completed a final agreement with BP PLC and China National Petroleum Corp. and an initial agreement with a consortium led by Italy's Eni SpA. U.S. oil company Occidental Petroleum Corp. participated as a junior partner in the Eni-led team.
The Exxon-Shell team, combining two of the world's biggest publicly listed oil companies, had been seen as the favorite to win the contract, which calls for the consortium to boost production at the already-pumping field in southern Iraq in exchange for a per-barrel fee. Among the three competitors, it offered the highest production target for the field, the Oil Ministry said.
An initial pact is expected to be signed on Thursday. The deal will then go to the Iraqi cabinet for approval before a final agreement can be signed, Oil Ministry spokesman Assem Jihad said.

Here's what it looked like five years ago to Information Clearinghouse:

The Great Iraq Heist

Iraqis are paying for the war waged against them

A.K. Gupta

01/15/04: Forget for a moment about quagmire, the growing heaps of U.S. and Iraqi dead, and the rebellious population. George Bush, Paul Bremer, and gang have pulled off the biggest heist in history. They and no one else own 100 billion barrels of crude oil—a windfall of at least $3 trillion—along with the entire assets and resources of Iraq.

Since March 2003, a series of executive orders by Bush, UN documents, and regulations and orders issued by Iraqi Proconsol Paul Bremer have put the U.S. in absolute control of the state of Iraq, its oil industry and monies, all while lifting barriers to repatriating profits.

In the name of reconstruction and security, the Bush administration has essentially granted itself the power to use the wealth of the Iraqi people as it sees fit. Never mind that the new “fiscal matrix” in Iraq violates international law: a fact of little concern to the White House when the war was illegal to begin with.

The largest contracts have gone to corporations like Halliburton, Bechtel, and Fluor, which are big contributors to the Republicans and now enjoy oversight of their Iraq activities by former executives who now sit in the Bush administration. Furthermore, Bush has given the corporate victors the ultimate protection: indemnifying them from liability for any and all activities related to Iraqi oil.

To top it all off, the Coalition Provisional Authority in Iraq is using money from oil sales to help pay for the counterinsurgency campaign. So not only are U.S. corporations reaping billions off the conflict in sweetheart deals with legal impunity, but Iraqis are being forced to pay for the very war being waged against them.

The story begins in February 2003 when the U.S. Agency for International Development secretly asked six companies to bid on a reconstruction contract worth, at minimum, $900 million. The six—Bechtel, Fluor, Halliburton subsidiary Kellogg, Brown & Root, Louis Berger Group, Parsons, and Washington Group International—were all generous supporters of the Republicans, having given them a combined $2.3 million between 1999 and 2002. . .

 We tend to interpret the world in ways that justify our advantages and show that our problems are someone else's fault.  But it's only true some of the time.  


  1. American haters, including many US citizens have chosen to condemn this great country for any and all actions! They do not and never will admit the boundless benefits the world has reaped from American bounty and charity, instead they detest and hope for the downfall of the most productive nation to ever be! There are nations all over the globe that have better lives and freer lives because of American companies exploring and producing whatever natural resources that nation has to export.Left wing zealots will always equate any American involvement with exploitation, but that is not true! I've often wished that "left wingers' all over the world could be magically be transported into a dimension with no United States, no capitalism, and no remnants of American achievements or contributions to the world! How many nations would be truly free, how many earthlings would have electricity, running water or even canned food? Unbelievably , humanity may eventually get a chance to experience such a
    "dimension" as "eco-progressives"in America and world wide seek the ultimate equality of nations, but the cold hard fact is that with their plans, Namibia will not become Americas' equal, America and the world will become Namibias' equal!

  2. Stone.mike64 - Did you write this comment because of something you read in this post? Or is this a general comment that you post all over the net?

    I ask that in complete sincerity since you haven't addressed anything specific in the post. Are there any factual errors that you noticed that you can point out?

    I'm not sure whom your comment is aimed at. I've posted four different perspectives on this. Is this aimed at all of them? At me? At one of them?

    Are you saying that the US is beyond criticism in all it does? Are you saying that American business interests around the world only cause good and no harm to local interests?

    How is it that you know the motivation of these writers and can identify them as America Haters?

    For instance you write "America Haters . . . have chosen to condemn this great country for any and all actions!" It seems to me that the two writers here who are critical of this oil deal are specifically writing about related Iraq war business connections. How do you know what they would say about the discovery of penicillin or polio vaccine? Or the establishment of water and sewer systems in poorer countries?

    Do you yourself only say good things about the United States? Do you support everything the American government does? If you have ever criticized the action of the US, a US organization, or a US president, someone could use your own logic to accuse you of being an America Hater based on your criticism of one event.

    I'd be interested in hearing a response to these questions and perhaps more about your background that gives you such strong passion on these issues.


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