The oil dispute puts Baghdad in front of “big” legal problems.. Billions of compensation for Erbil (details)

[6ly410]

Oil contracts for the region without the knowledge of the federal government (sales contract with Rosneft model)

Posted 5 seconds ago

 

news sourcenoon agency

Oil contracts for the region without the knowledge of the federal government (sales contract with Rosneft is a model) - Iraq news (iraqakhbar-com.translate.goog)

Written by: Zaid Al-Mohammadawi

Since the regime change in Iraq after 2003, and the authority in the region deals with the center, its state deals with a state, not a region with a central government, and the issue of oil was the most prominent file in this regard. It is trying to weaken the control of the federal government in order to be in control and also in order that the federal government cannot hold the authority in the region accountable for constitutional abuses and bypassing the powers granted to regions and governorates that are not organized into a region.

The region’s authority has contracted with oil companies in large investment contracts related to the economic security of the whole country and its sovereignty, but without the knowledge of the federal government, and in a type of contract that is different from what the federal government in the center and south went to with oil contracts in the manner of oil service, it adopted another type, which is the oil partnership contracts Which costs the country a lot of money that goes to corporations not the federal public treasury.

Among those contracts are oil sales contracts. In this matter, which is one of the powers entrusted to the federal government and its representative, the Oil Marketing Company SOMO exclusively, the region did not commit to:

1 - No controls

2 - Not to the parties to which it is sold

3- Nor by handing over such funds to the Federal Government and the Federal Revenue Authority.

There are many examples of those contracts, but today we will shed light on the region’s authority contract with the Russian company Rosneft, so we will show you the most important contractual, technical and financial consequences of this contract, which are as follows:

1 - The contract was concluded without reference to the federal government, and thus the contract is a constitutional violation, as well as a decision of the Federal Supreme Court No. 121 / Federal / 2022.

2 - The duration of the contract between the two parties is annual, and everyone knows that the conditions that have passed in the world, especially after the Corona pandemic and the Ukrainian crisis, have shown us that prices are in great fluctuation and therefore it is incorrect to conclude a sales contract for a year.

3 - The name of the sold oil does not refer to Iraq, as it is under the name (Kurdistan Crude Oil Blend) and it would have been better (Iraqi Kurdistan Crude Oil Blend), and this indicates their separatist tendencies.

4 - In one of its clauses, it included (in the event the seller fails to supply the contract quantity under the contract in terms of supplying the entire contract quantity before the end of the eight years or his failure to pay) and here it appears to us that the contract has either continued for another eight years or it has been over eight years.

5- The oil will be loaded by large oil tankers (AFRAMAX) (which belongs to the Russian company “Sovcomflot”, which owns 83% of its shares, according to “Bloomberg”). The weak point is that the region is obligated to completely fill the tanker until And if the order is less than the specified tonnage of the tanker, which is 600,000 barrels.

But the contract did not refer to this quantity and how to treat it.

6 - The contract specified that the specifications of the crude oil be API 30, and the price is the reference crude for Brent minus 7.35 dollars / barrel, as an upper limit for the price was set without the region protecting the value of its oil exports by setting an acceptable minimum price.

7 - The price paragraph of the contract indicated that the default density value is 36 (API) and the buyer will be compensated by (0.40) dollars / barrel for each degree of density less than the aforementioned limit. ) grade (API), and this clearly means adding a price discount of (2.4) dollars / barrel)

8- Some articles of the contract also indicated that an additional price discount of (0.75) dollars/barrel will be imposed on the selling price when the final price of the barrel exceeds (22.75) dollars.

9- The contract also included the method of calculating the price of the signal (Brent) to be the average price of the signal oil, Brent Crude Oil (DATED BRENT) is the average for only two price bulletins of the PLATTS Corporation out of five price bulletins calculated starting from the date of the policy Shipping. Where the buyer has the right to name the days of the aforementioned two bulletins after a maximum of seven working days after the date of the bill of lading (noting that working days mean the days on which PLATTS issues its price bulletins) (This option adds another price advantage for the buyer to choose the pricing days to be the lowest price The reference oil is among the five bulletins for the aforementioned period.

10 - The contract referred to the value of the oil sold monthly, which is 405 million euros as a first payment, 310 million euros as a second payment, and 175 million euros in a third installment. Thus, the total value is 890 million euros, and in US dollars, the total amount is 955 million dollars.

11 - Dealing is in the euro instead of the dollar, unlike what is done in the center

12- The issued oil money is deposited in (BankMed or BANKMED SAL) ((is a Lebanese bank established in 1944 and owned by the holding company GroupMed). It is one of the five largest banks in Lebanon in terms of assets and deposits, and it has 44 A branch in Lebanon, one in Cyprus, and one in Geneva (it is called Bankmed Suisse. Bankmed is owned by the Rafik Hariri family)), and the money was supposed to be deposited in the Trade Bank of Iraq like the rest of the federal oil revenues, but the separatist tendency and the secrecy of the region’s dealings with the issue of oil It makes them deal with offshore banks without the knowledge of the federal government.

13- Oil value funds are issued by DEUTSCHE BANK AG FRANKFURT (the bank is headquartered in twin towers in Frankfurt, Germany).

14- In the event that the final price of a barrel for the processed shipments exceeds the amount of (23.5) dollars / barrel and up to the price of (28.5) dollars / barrel, an additional price discount of (5) dollars / barrel shall be applied, provided that the value of the shipments is calculated in the event that the final price exceeds a limit of) 28.5 (dollars/barrels based on the difference between the final price and the mentioned price limit without an additional price deduction for the seller’s account.
15- The contract includes an unfair article and also includes a waiver and stipulates that (in the event that either party delays paying the dues of the other party, an interest rate of (5%) shall be applied) higher than the international average (LIBOR)), and therefore the total interest rate is 8%.

16 - The contract stipulated that in the event that the Iraqi government or any Iraqi entity or institution takes measures against the buyer of the region’s shipments that would incur any responsibilities, costs or expenses, the seller is obligated to compensate the buyer for all that, here the region gave guarantees that it does not possess and this paragraph It gives us a hint that the Russian company knows that this procedure is contrary to the laws and regulations of the federal government, so it wanted with this article to ensure its legal integrity in the event that the federal government requires it.

17 - A second article has been added to ensure that the company puts its legal protection, which is (the seller (Kurdistan region) must sign a legal protection agreement attached in the third appendix to the contract by which it protects the buyer from all consequences of purchasing the region’s oil shipments through his pledge that he has sufficient authority, authorization and authority to implement His obligations under this contract and that he has the ownership to dispose of the oil shipments With the offer that the text of Annex III expressly specifies that the region (the seller) protects the buyer and any affiliate thereof or his commercial group or his parent company and even other parties buying oil from him and tankers loaded with sold oil from any actions taken From the Government of Iraq or any of its political institutions, agencies or departments, including the Oil Marketing Company (SOMO)).

We say the prince has given what he does not have.

18 - The contract also indicated the following (United Nations resolutions regarding global sales of products issued in Vienna 1980 do not apply to this contract) and they are therefore selling oil in violation of international trade rules.

 

[6ly410]

2022/05/27 10:20  

Baghdad begins implementing the Federal Court's decision and ending the regional government's control of oil and gas (almasalah-com.translate.goog)

Baghdad begins implementing the Federal Court's decision and ending the regional government's control of oil and gas

 

Baghdad / Obelisk: The Ministry of Oil begins the first step to implement the Federal Court's decision regarding the region's oil and gas law, as the ministry asked companies operating in Kurdistan to sign new contracts with the state-owned Marketing Company (SOMO), in a new attempt to control oil revenues.

Oil Minister Ihsan Abdul-Jabbar says the Oil Ministry will start implementing the Federal Court ruling issued in February, which deemed the legal foundations of the oil and gas sector in the Kurdistan region unconstitutional after talks with the regional government failed.

The Iraqi Ministry of Oil has appointed international law firm Cleary Gottlieb Steen & Hamilton to reach out to oil and gas companies operating in the Kurdistan region to begin discussions to bring their operations into compliance with applicable Iraqi law.

Implementation of the court ruling will require changes to the companies' contract systems.

According to the National Oil Company, the region’s conclusion of oil contracts and agreements with international companies and countries to export the extracted oil and gas violates the provisions of the constitution, since the jurisdiction of the federal government is to formulate oil and gas development policy and manage the activity related to them and its competence in foreign trade.

The production-sharing contracts for the region’s fields gave the contractor a share of the extracted oil in addition to the freedom to dispose of his share of the produced quantities and sell them at the place and time specified by the contractor, and this violates Article 111 of the Constitution, which clarifies that oil and gas is the property of the Iraqi people, according to the National Oil Company.

The regional government, through production-sharing contracts, also signed a contractual commitment to exempt contractors from taxes and allowed them to inflate their profits without imposing any kind of taxes or sharing those inflated profits, especially when oil prices rose globally, and this violates the tax law of 1982 (amended) and its instructions.

The writer, Faisal Idris, considered that the Iraqi government's demands to control the national oil revenues are legitimate.

Oil expert Abbas Kazem says: They do not have the right to reject the Federal Court, which is the final reference in interpreting the constitution, which Iraqis, especially the Kurds, voted on by a large majority, and its decisions are final, binding on all and irrevocable, adding that concluding contracts without authorization and signing them by the regional government does not make These contracts are legal or constitutional.

Journalist Jaafar Al-Barrak commented that the region's contracts entitle foreign companies to have full control over the petroleum operations.

Academic Ali Al-Badri believes that the region's contracts were made when the oil barrel was 120 dollars, and when the oil fell to less than 50 dollars, the loss became for them, meaning the group got involved, and here is not the problem.

 

[6ly410]

Kurdistan Energy Committee: Neighboring countries opposed the oil and gas law as it threatens their interests

Posted 33 seconds ago

 لجنة الطاقة بكردستان: دول الجوار وقفت بالضد من قانون النفط والغاز كونه يهدد مصالحهم - اخبار العراق (iraqakhbar-com.translate.goog)

 

 

news sourceMawazine News

 

News source / Mawazine News12:46 – 28/05/2022

Baghdad - Mawazine News
, Deputy Chairman of the Energy and Natural Resources Committee in the Parliament of the Kurdistan Region,
Collizar Rashid Sindi, confirmed today, Saturday, that some neighboring countries opposed the oil
and gas law approved by the region, as it threatens its political and economic interests.

Sindi said in a statement that Mawazine News received a copy of it, that "Baghdad wants to
deal with the region with the mentality of central government away from constitutional constants, and this matter
is due to the fact that Iraq's decisions come from outside the borders, so that the matter became stripping the
center's dealings with the region from constitutional and national dimensions. " “.

The statement added, "The oil and gas law in the region seems to have become a source of
threat to the economic and political interests of some neighboring countries, which do not want the best for it and for
Iraq, which prompted them to stand against this law through influential parties in
the federal authorities that follow the policies of these countries." “.

And he indicated that "the regional government has been from the beginning to deal with the
federal government on a constitutional basis in order to solve all the outstanding problems between the two parties, including
the legislation of the Federal Oil and Gas Law, but the procrastination practiced by the federal government
because of some of the ruling political parties prevented this, stressing that the parties Politicians, if
they have the pure national will, can easily agree with the
Kurdish political parties in the House of Representatives to come up with a final version of the law in accordance with the provisions of the constitution,
in which the rights of the Iraqi people from oil wealth are taken into account, as it is their property as stipulated
in Article 112 of the constitution.
The statement continued, "The oil and gas law is still in effect in the region,
and all authorities are committed to it, in addition to the authorities that deal with the Ministry of Natural Resources.
Like the oil companies, pointing out that if the issue of the Federal Oil Law is settled in accordance with
the constitutional mechanisms, the existence of an oil law in the region will be necessary, given that the region’s
oil dealings with international bodies has become a realistic and legal reality.”

He pointed out that “the Iraqi constitution gave the region the right to issue a law that is not
related to the exclusive powers in the article in Article 110 contained in the constitution and in accordance with Article
112 of the existence of the oil and gas law in the region to be side by side with the
federal law if they are in agreement with the constitution and the rights of the region are taken into account in The unilateral law,
because the region’s law did not bring anything new and outside the framework of the constitution, and oil issues
are not among the exclusive powers stipulated in Article 110 of the constitution, so there is no
problem in the existence of an oil law in the region in this case.” Ended 29/M 99

 

 

 

[yota691]

A dispute between Baghdad and the Kurdistan region over oil

Published date: 28.05.2022 | 00:00 GMT |Arab world news

 

 

 

 

The President of the Kurdistan Regional Government, Masrour Barzani, renewed his rejection of the Federal Supreme Court's decision to hand over oil from the north to the center.

Meanwhile, the Federal Oil Ministry announced earlier that it was seeking to implement the judiciary's decision.

[yota691]

 

An official denial of a fabricated statement by Massoud Barzani about the Federal Court

 

 2022-05-29 02:52

 

Shafaq News/ Today, Sunday, Barzani's headquarters denied that Kurdish leader Massoud Barzani had made a statement about the Federal Court (the highest judicial authority in Iraq).

The headquarters stated in a statement today, that some media and social media circulated a fabricated news that President Barzani's statement about the decisions of the Federal Court and the Iraqi parliament, and Barzani's headquarters declares that the news is false and completely baseless.

Some local media had circulated fabricated news on the authority of Massoud Barzani, stating that "the Kurdistan Region is not concerned with the legislation and decisions issued by Parliament, the Union and the Federal Judiciary."

[Rochester]

1 hour ago, yota691 said:

 

An official denial of a fabricated statement by Massoud Barzani about the Federal Court

 

Massoud Barzani had made a statement about the Federal Court (the highest judicial authority in Iraq).

The headquarters stated in a statement today, that some media and social media circulated a fabricated news that President Barzani's statement about the decisions of the Federal Court and the Iraqi parliament, and Barzani's headquarters declares that the news is false and completely baseless.

 

Let me guess: Massoud Barzani has been paid off, by the central government in Baghdad. So he is no longer opposed to the Iraqi federal gov't implementing the oil law that is coming. 🎰   

[Stelardoc]

3 hours ago, Rochester said:

Let me guess: Massoud Barzani has been paid off, by the central government in Baghdad. So he is no longer opposed to the Iraqi federal gov't implementing the oil law that is coming. 🎰   

Sounds plausible to me. It's all about da money. Back door deals? why not?

Grease those political wheels and greasy palms with some dirty money.

Brought to you by the citizens of Iraq. 

the article says Barzani was misquoted by the media and social media. 

What's the difference between the media and social media" Nuttin honey!! They both smell of BS. Whoops left out the Gurus. 

If that is the last bit of corruption we have to endure then lets' just

See where this is going. 

Git er Done!!

[6ly410]

Telling the truth has consequences.. the court's decision against the region's oil is a model

Posted 2 minutes ago

 

Telling the truth has consequences.. the court's decision against the region's oil is a model - Iraq news (iraqakhbar-com.translate.goog)

 

news source /noon agency

News source / Noon Agency

 

Written by: Zaid Al-Mohammadawi

When we were young, they taught us in the subject of reading that survival is in honesty, and that telling the truth is nothing above it, but the matter is different in reality and in practical life because if we ask for the truth, we must wait for the consequences of that word.
A few days ago, we saw an inspector in the Ministry of Industry who spoke about smuggling scrap into the region without the approval of the Minister of Industry and in a suspicious operation. That brave official was unfair and unjust, he was relieved of his position and he is living in a miserable condition today.
Why? Because he spoke the truth and honesty about the territory.
There are many examples of this and of those who are dismissed from their positions because of telling the truth and honesty in the right of the authority of the region, and among them are those whose names are vetoed in the positions of the governments that follow the government in which he was.
One of the examples that we are living now is that the Federal Court, when it decided that the oil and gas law for the Kurdistan region was unconstitutional, and when it obligated the federal government to implement that decision (because it is binding and has become), the Federal Ministry of Oil moved and formed a committee to implement the mechanism for implementing the decision, and after negotiations that reached for more than 75 days However, the region’s authority rejects:
1 - any proposal submitted by the Ministry of Oil
2 - it also refuses any dealings with the ministry
3 - it rejects the court’s decision and the matter came to calling for its dissolution and its unconstitutionality
4 - They also rejected the constitution regarding the fact that oil and gas belong to all Iraqis And they made it the property of the territory only.

As a result of the movements of the Ministry of Oil in implementing the Federal Court’s decision regarding the unconstitutionality of oil and gas in the region, and less than a day after the Minister of Oil said that the region is not cooperating in this regard, we noticed, unusually, a major attack and from various members of the region and from the center and the south calling for the dismissal Minister on various matters.

Or before that, we did not hear from them. Is it related to the minister’s statement regarding negotiations with the authority in the region or about other matters, who obstructs the region’s policy and ways of dealing with the federal government in order to make it:
1 - Weak so that it cannot be held accountable.
2 - It is affiliated with it, by working to recruit ministers who are subject to them as well as directors. And work to exclude ministers and directors who put the interest of Iraq before the interest of the region.
3 - Standing about any legislation that would do justice to the people of the center and the south from the theft of power in the region for Iraq's money, and an example of this is the region's standing against the legislation of the oil and gas law.
4 - The authority in the region undertakes a different type of oil contracts and offers large price discounts that will:
A - attract companies to work for them and leave work in the center and south
B - Iraq loses large financial revenues.

5- The region’s authority had the most prominent role in not investing gas and oil in Kirkuk, which is under the federal oil administration, because it hopes to control it, and it is the one who contracts with international companies, knowing that the region controls several fields in Kirkun and invested them with foreign companies such as Khormor and Khormala fields .

The solution and recommendations
1 - is to support the Federal Court, especially with regard to its aforementioned decisions.
2 - A statement to the people about what is taken by the region's authority from the oil of the center and the south without paying a single dinar of the region's oil to the public treasury.
3 - A statement to the people of the fields that were occupied by the authority of the territory.
4 - Work to recover the oil fields that were seized by the region after 2003.

 

 

 

[6ly410]

The negative effects of the region's oil contracts on the people

Posted 11 seconds ago

 

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news source /news

 

The negative effects of the region's oil contracts on the people - Iraq news (iraqakhbar-com.translate.goog)

 

Introduction // Oil is the basic commodity for the economies of the producing and consuming countries as it plays a pivotal role in the sustainability of the activities of major economic sectors in them, as well as their development and modernization of infrastructure. In the absence of economic and cheap alternatives to energy sources, it will remain the most important factor in reversing the balance of power and changing the maps of colonial ambitions, especially in the Middle East and its environs, and turning it into an area of permanent conflicts. I was almost certain that oil was one of the most important undeclared reasons for the occupation of Iraq, a goal that America sought before the invasion with Ryan Crocker’s proposals by handing Iraq’s oil to American investments according to concession contracts or long-term participation, because most of the American oil fields were depleted and production fell and became It imports two-thirds of its oil consumption. And since Baghdad began signing service contracts instead of partnership contracts, after America’s dream was to sign oil contracts with the same ease with which it occupied Iraq, and to raise the production ceiling to whatever it wants, but it failed. . America’s oil security makes the region a large and profitable capital for its oil industry, in addition to that, with its oil policy, it threw all its weight to support and support foreign oil companies in order to break the will of Baghdad and impose and sign unfair partnership contracts against Iraq and its people with its Arabs, Kurds and other nationalities (oil is not the property of the region alone, but For all the Iraqi people), and this can never be justified unless there is a specific intent behind it or that the region’s negotiator is not qualified for such complex negotiations (I was a member of the negotiating delegation for BP and Mobil Oil in ’78 and realized the cunning of the foreign negotiator and the accuracy of choosing the expressions used in oil contracts) , Or that the matter is intended to be implemented by paying those companies according to a scheme that does not serve the country. All the region's contracts signed so far amounting to 57 contracts are unfair and even shameful participation contracts against Iraq, which has a global reputation in the field of oil that dates back to the thirties of the last century. Even those contracts depend on the type of contract, its period, the strength of the negotiator, and the geographical area granted to the investment. Is it an oil explorer or is it not known geologically? Therefore, the company will venture to choose the area and invest money to explore seriously about the presence of oil or not, and this is what the region did not take into account, where it occurred Contracts for well-known areas and fields and the presence of oil reserves in them, and therefore there is no risk in choosing them. All the facts were giving the region a golden opportunity to obtain a larger percentage and share of the contracted company, but what happened in the nature of the contracts concluded was the opposite.  

Why contract with foreign companies // There are reasons that push countries to take decisions to contract with companies with long experience in the oil industry, with a good global reputation, and possessing modern technology in methods of exploration, research, drilling, development and oil production, as well as the need to provide investments that are used in reviving vital sectors in it, such as Industry, agriculture, construction, people's welfare, tackling poverty, reducing unemployment rates, and others. From the foregoing, Iraq is one of those countries that emerged from a dark period of wars, siege, occupation and economic crises that created a great inability to provide sufficient funds to make expensive investments, as well as obsolescence of equipment and lack of experience and technology in several aspects such as developing fields and raising their production capacity, so I turned to expertise companies. With the insistence of America, during the invasion, the destruction of the oil industry and all the Iraqi infrastructure and its economic, industrial, agricultural, architectural and other facilities in a plan to build a new Iraq with a new friendly government, followed by its stepdaughter Al-Qaeda, then Bremer completed what the armies had started and issued his decision to dissolve the army and security services, and announced that eleven fields Oil is in need of urgent development. During more than ten years, the Center concluded seven oil contracts of the type of service contracts. As for the region, it has unilaterally concluded in several years more than 57 oil contracts with various companies, some of which have experience in the oil sector and others are modest. All of them are long-term partnership contracts that are closer to concession contracts and for promising geographic areas with their proven oil reserves. As for the region, it has unilaterally concluded in several years more than 57 oil contracts with various companies, some of which have experience in the oil sector and others are modest. All of them are long-term partnership contracts that are closer to concession contracts and for promising geographic areas with their proven oil reserves. As for the region, it has unilaterally concluded in several years more than 57 oil contracts with various companies, some of which have experience in the oil sector and others are modest. All of them are long-term partnership contracts that are closer to concession contracts and for promising geographic areas with their proven oil reserves. 

There are different types of oil contracts: 

First: “Concession contracts” is a kind of complete concession to foreign companies over the management of the country’s oil industry affairs, which were prevalent in the thirties. In which the companies impose their conditions on the state that owns the land and the oil, but they have developed into partnership contracts and an agreement in production between the company and the state, during which the state is allowed to participate in the management of the oil industry and profits according to agreed percentages. The foreign company bears the costs of exploration, drilling, development and production, and then the company recovers all its expenses from the oil produced in a fixed percentage agreed upon, and the rest is distributed in proportions agreed upon as well. . Such contracts will be in two phases, short-term and long-term, under which the company is exempted from taxes and state and population compensation, but it is obligated to train and employ a percentage of the local workforce. The region concluded such contracts in geographical areas, confirming the presence of oil there. However, due to the lack of skill in the negotiator, the agreed ratios were unfair to the people. Among them are contracts with the Norwegian company DNO in the fields of Tauki, Semel, Toki, Bashkhbour, Binan and Bastoura, and contracts with the American company ExxonMobil in the fields of Ain Sifni and Sheikhan in Mosul. One of its clauses is for the companies to recover all the money they spent first and then to share with the region 40% of the remaining percentage, provided that the unextracted oil remains restricted to the company because it is linked to its rights, i.e. property is seized during the long-term contract period. If we compare similar contracts concluded by the Sultanate of Oman, for example, it has specified an 80% share for it, compared to 20% for the operating company, regardless of the level of production. (Saad Allam / Encyclopedia of Petroleum Legislation for Arab Countries / Arab Gulf Organization / 1st Edition Doha Qatar 1987.) Among them are contracts with the Norwegian company DNO in the fields of Tauki, Semel, Toki, Bashkhbour, Binan and Bastoura, and contracts with the American company ExxonMobil in the fields of Ain Sifni and Sheikhan in Mosul. One of its clauses is for the companies to recover all the money they spent first and then to share with the region 40% of the remaining percentage, provided that the unextracted oil remains restricted to the company because it is linked to its rights, i.e. property is seized during the long-term contract period. If we compare similar contracts concluded by the Sultanate of Oman, for example, it has specified an 80% share for it, compared to 20% for the operating company, regardless of the level of production. (Saad Allam / Encyclopedia of Petroleum Legislation for Arab Countries / Arab Gulf Organization / 1st Edition Doha Qatar 1987.) Among them are contracts with the Norwegian company DNO in the fields of Tauki, Semel, Toki, Bashkhbour, Binan and Bastoura, and contracts with the American company ExxonMobil in the fields of Ain Sifni and Sheikhan in Mosul. One of its clauses is for the companies to recover all the money they spent first and then to share with the region 40% of the remaining percentage, provided that the unextracted oil remains restricted to the company because it is linked to its rights, i.e. property is seized during the long-term contract period. If we compare similar contracts concluded by the Sultanate of Oman, for example, it has specified an 80% share for it, compared to 20% for the operating company, regardless of the level of production. (Saad Allam / Encyclopedia of Petroleum Legislation for Arab Countries / Arab Gulf Organization / 1st Edition Doha Qatar 1987.) One of its clauses is for the companies to recover all the money they spent first and then to share with the region 40% of the remaining percentage, provided that the unextracted oil remains restricted to the company because it is linked to its rights, i.e. property is seized during the long-term contract period. If we compare similar contracts concluded by the Sultanate of Oman, for example, it has specified an 80% share for it, compared to 20% for the operating company, regardless of the level of production. (Saad Allam / Encyclopedia of Petroleum Legislation for Arab Countries / Arab Gulf Organization / 1st Edition Doha Qatar 1987.) One of its clauses is for the companies to recover all the money they spent first and then to share with the region 40% of the remaining percentage, provided that the unextracted oil remains restricted to the company because it is linked to its rights, i.e. property is seized during the long-term contract period. If we compare similar contracts concluded by the Sultanate of Oman, for example, it has specified an 80% share for it, compared to 20% for the operating company, regardless of the level of production. (Saad Allam / Encyclopedia of Petroleum Legislation for Arab Countries / Arab Gulf Organization / 1st Edition Doha Qatar 1987.)                                                                                                        

Second // Joint Venture Contracts: Such contracts are concluded between three parties, namely the state, the foreign company and the national oil company of that country, or it may be concluded between a national oil company representing the state and the foreign company. Such contracts were concluded in some Arab countries and in Iraq. These contracts are characterized by the sharing of expenses and revenues, after the discovery of oil. The foreign company bears all the expenses of research, exploration, drilling, and taxes. But if the operations did not result in the presence of oil, the foreign company has no rights for the money it spent.                        

 

Third, “Services Contracts” are the latest, most beneficial and profitable for countries that own land and oil, and this is what the Baghdad government concluded in the seventies with the French company Airab and then through recent licensing rounds, in addition to maintaining the state’s sovereignty over its oil fields because foreign companies operate As a contractor, it has to bear all the risks alone in return for a wage that it will get from the produced and marketed oil, in return for the technical services it provided in exploration, drilling, training, development, production and other heavy financial expenses. A percentage of the oil reserves for the benefit of the national company in return for an agreed upon commission, and it does not have the right to dispose of all the discovered oil reserves because the ownership of oil is for the host country, and a national reserve belongs to the people.In addition to the existence of legal legislation backed by the sins and negatives of the region’s oil contracts // The fact that the region did not seek the assistance of the expertise of the center’s cadres on the one hand and the weakness of its capabilities and financial capabilities needed by the exploration, drilling, development and oil production operations in its lands, all of which made it a motive to seek the assistance of foreign oil companies, but what happened to it It is the weakness of the negotiator's skill, the sophistication of the foreign negotiator, and political factors that make the concluded contracts fragile contracts marred by suspicions and negatives. 

1- The Iraqi constitution expressly states that (the natural resources belong exclusively to the Iraqi people), and therefore the region’s contracts are considered a serious constitutional violation, as they lose their legitimacy due to their inconsistency with its reality as an Iraqi region. The region sought to obstruct the issuance of the oil and gas law by standing against any clause that gives the center the right to invest all Iraqi oil and sign contracts. It seeks that the oil revenues be in the form of quotas for each party that takes its returns based on the volume and quantity of production from the fields and the terms of the contracts it signed as if the oil is a personal property. Issuing the oil and gas law that has been lying in the corridors of Parliament for years, and amending the constitution is very necessary. The region dreams of secession as a state, but it will face the problems of rejecting neighboring countries, even if it makes concessions.   

2- The region's negotiator did not take into account the geographical areas granted for investment, most of which are geologically confirmed by their oil reserves, which makes companies reassuring not to take the risk of choosing and investing their money. The terms of the contract should be in the interest of the region. It imposes its conditions and percentages that it deems appropriate at the expense of the companies’ low shares, but the reality of the contracts is the opposite. The companies’ share exceeded 40% of the amount of production after deducting what they spent of money as well as 53% as production and profits, which is It is unfair in such areas with certain oil and low production costs, as it is an insult to the country and a waste of people's money.   

3- The region’s ambition is to hand over most of the promising northern lands to foreign oil companies in order to extend its hegemony over all the northern oil sources so that it can turn into an oil power in which production exceeds one million barrels of oil per day, and it has actually exceeded that. Its oil contracts included all the territory of the region and exceeded the disputed areas and Nineveh (Alqosh, Bashiqa, Bardrash, Safiya, and Sheikhan), and recently he usurped the Kirkuk fields by force (Kharmala, Daoud, Bay Hassan and Avana) and in Diyala and Salah al-Din, taking advantage of Baghdad's crisis situation.  

4- The region signed 57 oil contracts with less than five years, 17 of which are in disputed areas, most of which are bad production-sharing contracts with oil companies, most of which are small and not known globally, which is a surprising phenomenon in oil affairs. These unfair contracts were tempted by the American company Chevron, Exxon Mobil and Russia's Kazprom, which left their contracts in the south and concluded contracts with the region that included 13 geographical areas.

5- The unfair, quick and ill-considered contracts that the region signed, which threw their weight to support international oil companies, may have been intended to force the center to accept the fait accompli, and even if we interpret this in good faith, it can be said that the negotiator is not qualified for such complex rounds (I was part of the negotiating delegation for BP and Mobil Oil). In the year 78 he realized the sophistication of foreigners in choosing expressions and creedal clauses. All the region's contracts are ashamed of Iraq's right to the world's reputation in the field of oil, which dates back to the thirties of the last century. 

6- The region enjoys security stability, its decision is personal, and its trade relations are good with several Arab and European countries, as well as with America. His dream is to attract larger investments and as soon as possible at the expense of the nation's interests and sovereignty, and this matter is an economic risk. That is, he is experiencing an oil explosion that pushes him to surpass some OPEC countries in his oil production, while he needs to develop all his oil, service and food security sectors, and he is also experiencing financial inflation. Great and thus the blessing of oil will turn into a curse. 

7- The region took advantage of the opportunity and signed the largest number of oil contracts in a hurry before issuing the oil and gas law, which will provide the legal framework for the oil and gas sectors in Iraq. But the region hastily issued the Kurdistan Oil Law on 6/8/2007, and it was initiated and approved in two days. Two days later, the contracts were ready, and more than 15 oil contracts were signed in 6 weeks without submitting them to the region's parliament for discussion. 

8- One of the region’s excesses was to prevent the Federal Ministry of Oil from linking the Kormore gas field to the Jambour field with the North Gas Complex in Kirkuk to increase the amount of dry and liquid gas production, then seized it and signed a contract to develop it with the Emirates Crescent Company. The irony is that the region is currently exporting gas to Turkey at a time when Iraq buys gas from Iran to operate electric power plants after the region stopped the connection with the North Gas Complex. The region also prevented the installation of equipment for the development of the Khurmala field, which is part of the Kirkuk fields, and then granted it to the Kurdistan Oil Company, in preparation for granting it to a foreign company. 

9- The region's signing of unfair oil agreements with giant American companies such as Chevron and ExxonMobil, as well as Russia's Kazprom, through which it would like to show the world that it is one of the major players in the oil markets, and it was announced explicitly at the recent energy conference held in Dubai that it is ready to export gas to Europe.  

10- The signing of such a contract with Exxon Mobil encouraged major oil companies such as Chevron of the United States and Eni of Italy to go to the region, knowing that the potential for oil in it is certain and does not require venturing with their investments, and that the concluded contracts are in their favor despite the possibility of legal problems with the center.

11- The region has adopted a policy that is provocative to the center and that may cause future crises with it and companies, as well as the positions of most of its representatives and their double dealing with issues that are not related to the region and giving priority to the interest of the region over the interests of other cities, especially since the country needs to agree on the participants to get out of crises and conflicts that trouble the people and mess his capabilities and his future. Therefore, the day when all the disputed issues will appear as they were taken by force in difficult circumstances will pass through Baghdad. 

12- The companies set precise clauses in their contracts that are in their favour, which is that they are not obligated to a specific time period and program to replace, train and compensate foreign cadres with local ones. It has succeeded in reducing the chances of the region’s cadres acquiring expertise and learning modern techniques in the field of oil that it uses in its work. This is why it ends from time to time the cadres’ contracts before completing their periods of mastery with sufficient experience so as not to compete with foreign expertise.  

13- The contracts did not include a clause on the condition that the region obtain technical and economic reports and studies upon the discovery of oil, and even the amount of possible production and reserves before announcing the discovered and marketed oil and allowing the start of production and development operations, which is an important clause as it possesses advanced technology in the field of the oil industry, which may benefit in the future in developing The structure of the Iraqi oil industry.

14- The contracts included a paragraph that corresponds to the demands of foreign companies, which is that in the event of disputes, they are resolved between the company and the region through international courts, especially in the International Chamber of Commerce in Paris, and this paragraph is fully consistent with the interests of foreign companies. 

15th- The region signed an oil contract in 2007 with the American Hunt Company, which is owned by a senior American intelligence man on a geographical area that is officially outside the borders of the region (in the Ain Sifni sector), and it is one of seventeen similar contracts. These are dangerous indicators of overstepping the arm of the center, as the region operates separately from Iraq.

16- One of the ironies is that the center excluded the Korean oil company KNOC from the tours due to its contract with the region for four geographical areas. During the implementation of the contracts, the company considered them to be failed contracts due to the low volume of oil reserves that were estimated. The Korean newspaper, Chosun Ilbo, admitted after the drilling operations were carried out that the volume of oil in it was uneconomic, and that the process of developing it was expensive. Korea insisted on having clauses in the contracts set by the company in its favor, which it will submit to the court to recover its spent money, as it says. 

17- I hope that the region, after the Federal Court’s decision of the illegality of those contracts, will cooperate with Baghdad and re-examine its contracts again and amend its terms to give it legitimacy and legal basis. Because its survival will give companies great profits, which is a dangerous precedent and waste of money, and in contrast, the day will come when the Center will be forced to put these companies on the blacklist, and submit them to the judiciary on charges of oil piracy on Iraqi lands without the knowledge of the federal government. Therefore, the people and history will expose and hold accountable all those who remained silent about these violations and waste of money.

18- Due to the inexperience of the region’s negotiator, foreign companies have set unfair terms, conditions and obligations against the region, including increasing their percentage of the produced and marketed oil, and reducing the recovery period for their investments. They have also succeeded in imposing a high commission on oil marketed and sold by them, and disavowing financial obligations such as considering the money they spend as loans. With high interest, the regional government is obliged to pay it out of its share of the oil produced and in a short period of time. 

19- What companies seek when concluding contracts is to achieve large profits, with long-term contracts, and to reserve production rights for guaranteed reserves, so that their capital and stock prices will rise, and the world’s confidence in them will increase. This is what the region granted to most of the contracting companies, in addition to the fact that it elected geologically known oil fields with its oil reserves, low production costs and no risks, so it achieved the highest profits at the expense of the region’s low interest, and consequently the companies were flocking to it, but most of them left contracts in the south and concluded others in the north, This is because the negotiator in Baghdad chained the companies with impossible demands they did not want and with service contractor contracts with a small profit margin. 

20- It is known that the cost of producing a barrel of oil in the region is low despite the sometimes complex topography, but the companies exaggerated in calculating the costs of producing a barrel of oil from the region’s fields within their contracts, which is the reason for allocating a large part of the produced and marketed oil to compensate and recover their investments, which is called cost oil. 

21- The region objected to Article 16 of the draft oil and gas law regarding standards for exploration and investigation of natural resources and that they belong to the people and belong to the center in order to achieve the maximum national return for the Iraqi economy and to give the foreign investor an appropriate return with shares agreed upon in service contracts as a result of investing his money in the fields in exchange for cost oil and profit oil . The distribution continues until the investor recovers the amounts spent. After the expiry of the cost oil period, he begins to obtain profits in appropriate proportions to be agreed upon. 

22- The mechanism of spending oil wealth will remain an inherent problem until the issuance of the oil and gas law. The region demands that Baghdad pay from its oil revenues to pay the profits of the oil companies operating in the region, while the region has not committed to any agreement concluded with Baghdad regarding the amount of production and oil exports and the payment of imports, taxes and others in a transparent manner. Note that large quantities of oil are smuggled from the region and Baghdad does not know anything about all its revenues, in addition to its refusal to any financial control over its imports, border crossings, and the number of its employees.

 

Dr. Abbas Saleh Al-Badri

Natural Resources Economics Consultant

 

 

[Stelardoc]

5 minutes ago, 6ly410 said:

Telling the truth has consequences.. the court's decision against the region's oil is a model

Posted 2 minutes ago

 

Telling the truth has consequences.. the court's decision against the region's oil is a model - Iraq news (iraqakhbar-com.translate.goog)

 

news source /noon agency

News source / Noon Agency

 

Written by: Zaid Al-Mohammadawi

When we were young, they taught us in the subject of reading that survival is in honesty, and that telling the truth is nothing above it, but the matter is different in reality and in practical life because if we ask for the truth, we must wait for the consequences of that word.
A few days ago, we saw an inspector in the Ministry of Industry who spoke about smuggling scrap into the region without the approval of the Minister of Industry and in a suspicious operation. That brave official was unfair and unjust, he was relieved of his position and he is living in a miserable condition today.
Why? Because he spoke the truth and honesty about the territory.
There are many examples of this and of those who are dismissed from their positions because of telling the truth and honesty in the right of the authority of the region, and among them are those whose names are vetoed in the positions of the governments that follow the government in which he was.
One of the examples that we are living now is that the Federal Court, when it decided that the oil and gas law for the Kurdistan region was unconstitutional, and when it obligated the federal government to implement that decision (because it is binding and has become), the Federal Ministry of Oil moved and formed a committee to implement the mechanism for implementing the decision, and after negotiations that reached for more than 75 days However, the region’s authority rejects:
1 - any proposal submitted by the Ministry of Oil
2 - it also refuses any dealings with the ministry
3 - it rejects the court’s decision and the matter came to calling for its dissolution and its unconstitutionality
4 - They also rejected the constitution regarding the fact that oil and gas belong to all Iraqis And they made it the property of the territory only.

As a result of the movements of the Ministry of Oil in implementing the Federal Court’s decision regarding the unconstitutionality of oil and gas in the region, and less than a day after the Minister of Oil said that the region is not cooperating in this regard, we noticed, unusually, a major attack and from various members of the region and from the center and the south calling for the dismissal Minister on various matters.

Or before that, we did not hear from them. Is it related to the minister’s statement regarding negotiations with the authority in the region or about other matters, who obstructs the region’s policy and ways of dealing with the federal government in order to make it:
1 - Weak so that it cannot be held accountable.
2 - It is affiliated with it, by working to recruit ministers who are subject to them as well as directors. And work to exclude ministers and directors who put the interest of Iraq before the interest of the region.
3 - Standing about any legislation that would do justice to the people of the center and the south from the theft of power in the region for Iraq's money, and an example of this is the region's standing against the legislation of the oil and gas law.
4 - The authority in the region undertakes a different type of oil contracts and offers large price discounts that will:
A - attract companies to work for them and leave work in the center and south
B - Iraq loses large financial revenues.

5- The region’s authority had the most prominent role in not investing gas and oil in Kirkuk, which is under the federal oil administration, because it hopes to control it, and it is the one who contracts with international companies, knowing that the region controls several fields in Kirkun and invested them with foreign companies such as Khormor and Khormala fields .

The solution and recommendations
1 - is to support system" rel="">support the Federal Court, especially with regard to its aforementioned decisions.
2 - A statement to the people about what is taken by the region's authority from the oil of the center and the south without paying a single dinar of the region's oil to the public treasury.
3 - A statement to the people of the fields that were occupied by the authority of the territory.
4 - Work to recover the oil fields that were seized by the region after 2003.

 

 

 

Great commentary and read. Me likey alot.

Thanks for bringing that over

Nice to know there is some sanity to 

try to balance out the insanity and sheer greed

[Rochester]

Yota is the funniest guy at this site. Not even close. 

[screwball]

15 hours ago, 6ly410 said:

ederal Court With its decision No. 121 Federal 2022, which the authority in the region refuses to implement. But the decision is now binding, and the region will submit, whether it likes it or not, to this decision.

boom!

[screwball]

20 hours ago, Rochester said:

Let me guess: Massoud Barzani has been paid off, by the central government in Baghdad. So he is no longer opposed to the Iraqi federal gov't implementing the oil law that is coming. 🎰   

end result is what we are after if it takes bribes and pay offs, then let be so!

[screwball]

14 hours ago, 6ly410 said:

22- The mechanism of spending oil wealth will remain an inherent problem until the issuance of the oil and gas law. 

just need to vote on the the last amendment if its not already done!

[psdon]

TO ALL MILITARY VETS WELCOMED HOME  AND THANK YOU

[Half Crazy Runner]

8 hours ago, screwball said:

end result is what we are after if it takes bribes and pay offs, then let be so!

👆🏻👆🏻👆🏻👆🏻 That’s what I’m saying 😁

[Stelardoc]

On 5/30/2022 at 12:21 PM, psdon said:

TO ALL MILITARY VETS WELCOMED HOME  AND THANK YOU

Everyday should be a day we remember ALL. That serve. in EVERY WAY!!

So much respect for our VETS! Grandpa WW1 Uncle WW11 

Dad Korea. Great Great grandpa Civil War Fought at Gettysburg. Then on Sherman's March

He had just turned 15. after escaping military mandatory service in Germany.

We need to Keep our Kids home and clean up our own house. Oh it's messy.

If we UNITE WE WIN!! That goes for every country. WHERE WE GO ONE!  WE GO ALL!

We can TEACH PEACE!! Not war. 

  A message for the US, Iraq and the world.  Play it smart and united. It's not easy Ask JFF and MLK.

Learn Learn. Don't be a sheeple. Lead not follow. Don't reason with knot heads. They may or may not wake up

There many innocent meek and infirmed that need any kind of love or respect. Pray for them.

Sorry for the rant. Hate to see needless suffering

Pray for Peace every single day

 in our hearts and for the world!!

God Bless!!

 

[Stelardoc]

THANK YOU FOR YOUR SERVICE 

GOT BLESS YOU AND ALL OUR VETS EVERYWHERE AND 

AT DV

[6ly410]

SULAIMANI — A member of the oil and gas committee in Iraq’s Council of Representatives on Wednesday (June 1) called on the Prime Minister, Mustafa al-Kadhimi, to take action regarding the Kurdistan Region’s lack of commitment to the federal supreme court’s ruling from February on the Region’s oil and gas law.

Faleh Hassan Khazlaee, a member of the oil and gas committee in the House of Representatives, said in a message to Kadhimi that the committee invited the general director of Iraq’s State Organization for Marketing Oil (SOMO) to speak before the committee on Monday. 

Khazlaee said based on questions over the Kurdistan Region’s oil export case, the committee came to the opinion that the Kurdistan Regional Government (KRG) has not complied with the supreme court’s verdict to hand over the Region’s oil to the Iraqi government. 

He also stated the Region had not accepted the court’s ruling despite suggestions from the oil ministry on ways to ease the process. 

Khazlaee also referenced the Kurdistan Region’s undercutting oil sales at $11 less than the global price, which he referred to as a waste of public funds. His message stated his goal was for public wealth to be distributed fairly. 

The committee calls for fair action to be taken to enforce the law and for the oil case not to be mixed with political conflict and promotion but for citizens to regain trust in the law and the federal court, according to his message. This was especially important, the messages noted, in oil-rich provinces like Basra governorate, which accounts for a large share of the federal income. 

(NRT Digital Media)

[yota691]

A source for "Economy News": Oil companies in Kurdistan will appear before the Commercial Court in Baghdad next Sunday

oil field in kurdistan

energy
   

Economy News - Baghdad

An informed source revealed that Western oil companies operating in the fields of the Kurdistan region have received a summons to appear before the Commercial Court in Baghdad next Sunday.

The source, who preferred not to reveal himself to Economy News, said that the Ministry of Oil, after the Federal Court’s decision, which included the unification of oil policy and the failure of the Kurdistan Region to produce and export oil independently, began to take legal measures to compel oil companies to contract with Baghdad instead of the Kurdistan region, referring to The Western oil companies received a summons to appear before the Commercial Court in Baghdad next Sunday.

The source added that the companies operating in the Kurdistan region began to meet in London to agree on a specific mechanism, especially as it says that it is not binding with Baghdad, but rather in contracts signed with the Kurdistan Regional Government, and the dispute may turn to one of the commercial courts in Europe.

 

 

 

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80 . views

Added 06/03/2022 - 2:57 PM

Update 06/03/2022 - 4:36 PM

[6ly410]

Baghdad launches legal action against Kurdistan’s oil companies

IOCs summoned to appear in federal commercial court as Oil Ministry also signals international legal campaign against Kurdistan's oil sector independence.

Baghdad launches legal action against Kurdistan's oil companies - Iraq Oil Report

Iraqi federal oil and KRG political negotiating teams meet in Baghdad on April 11, 2022. (Source: Oil Ministry media office)

BEN VAN HEUVELEN, BEN LANDO, MOHAMMED HUSSEIN, RAWAZ TAHIR, ALI AL-AQILY, LIZZIE PORTER AND STAFF OF IRAQ OIL REPORT

THURSDAY, JUNE 2ND, 2022

 

    Iraq's Oil Ministry is initiating legal action against international oil companies operating in the Kurdistan region — part of an escalating effort to implement the Federal Supreme Court's landmark decision to invalidate the Kurdistan Regional Government's independent oil sector.

Multiple oil companies received a letter summoning them to appear at the Commercial Court in Baghdad on June 5, according to three Kurdistan-focused industry officials; and Alaa al-Yassiri, the director general of the federal Oil Ministry's marketing company (SOMO), told Parliament on Tuesday that Baghdad is also planning to bring international lawsuits.

[6ly410]

 

[6ly410]

 

[6ly410]

 

[ametad]

This sure looks like a war brewing to me…who is going to enforce the decision? I really don’t understand how these international arguments are settled in court. It takes force, plain and simple to enforce a decision like this…I just don’t see economic sanctions fixing this problem because the problem is within the country itself. Yeah, seems like a civil war in the making. They sure need to agree on an HCL or there will be blood, again.