Iraq: US and British ready to carve up the oil

As the costs of the Iraq occupation spiral, British and American oil companies meet in secret next week to carve up the country’s oil reserves for themselves. Tom Burgis reports.

The Iraq war has so far cost America and Britain £105billion. But the financial clawback is gathering pace as British and American oil giants work out how to get their hands on the estimated £3trillion worth of oil.

Executives from BP, Shell, Exxon Mobil and Halliburton, Dick Cheney’s old firm, are expected to congregate at the Paddington Hilton for a two-day chinwag with top-level officials from Iraq’s oil ministry. The gathering, sponsored by the British Government, is being described as the “premier event” for those with designs on Iraqi oil, and will go ahead despite opposition from Iraqi oil workers, who fear their livelihoods are being flogged to foreigners. The Met will be on hand to secure the venue ahead of the conference.

“This is a networking opportunity for UK businesses involved in Iraqi oil,” explained Dr Hussain Rabia, managing director of the consultancy Entrac Petroleum Ltd. “We have the moral support of the UK government. They’re bringing the guys over from Iraq, offering them visas. We expect all the big oil companies to be there,” he said.

Delegate numbers are described as “confidential”. Shell spokesman Simon Buerk would not confirm that a representative of the company would be attending, but said he “wouldn’t be at all surprised if they were”.

“We aspire to establish a long-term presence in Iraq,” he said. “We have been helping the [Iraqi] Ministry of Oil and engineers with training.”

Those who have purchased their £1,200 tickets can expect access to executives from Iraq’s oil ministry, including Salem Razoky, the director general of exploration.

But Iraqi oil workers are furious about the conference. “The second phase of the war will be started by this conference carving up the industry,” said an outraged Hasan Juma’a, head of the Iraqi General Union of Oil Employees. “It is about giving shares of Iraq to the countries who invaded it - they get a piece of the action as a reward. The British government will back this action in order to pay its debt in Iraq.”

Hasan, who represents 23,000 skilled oil workers, fears that deals struck at the conference will see profits from Iraq’s massive oil reserves - the second richest in the world - lining the pockets of multinational corporations at the expense of the Iraqi people.

You think?

Please do! I mean, motherfuck $3 a gallon.

I love the way they estimate Iraqi oil value by grabbing a high-order estimate of reserves and just multiplying it by the current barrel price.

The US ain’t ever getting that $300 billion (and change…plus more later) back.

That’s $3 trillion.

At $50/barrel, that assumes only 60 billion barrels to extract.

I’m pretty sure it’s a safe bet we can extract a “mere” $300 billion worth, which would be 6 billion barrels at $50.

Actually it was in pounds sterling, so closer to $5 trillion.

If Iraq was Saudi Arabia, they’d be able to sell $5 trillion worth of oil in…about 30 years. Except Iraq’s oil revenues are closer to 15% of Saudi Arabia’s. And needless to say, it will be a long hard road to even double that figure.

Poor bastards. The Iraqis just can’t win.

As backstory, here again is a Harper’s article (by Naomi Klein?!?! go figure) making a very good case that the insurgency got its start out of fear (partly justified IMHO, but mileage may vary) that the US was looting the country for foreign corporations. Surprise surprise, if you try to fire the workers at state-owned factories (a seriously huge chunk of the economy there) enmasse with no compensation, you get violent resistance.

One month later, Bremer unveiled the centerpiece of his reforms. Before the invasion, Iraq’s non-oil-related economy had been dominated by 200 state-owned companies, which produced everything from cement to paper to washing machines. In June, Bremer flew to an economic summit in Jordan and announced that these firms would be privatized immediately. “Getting inefficient state enterprises into private hands,” he said, “is essential for Iraq’s economic recovery.” It would be the largest state liquidation sale since the collapse of the Soviet Union.

It reads like a Chomskian fever dream, but I’ll be damned if it isn’t the explanation that best fits the facts.