Sadr Bloc and Sunnis object to Oil Law

I wonder if we will hear anything about the debate in the legislature? The oil unions are also opposed to the draft oil law. The next article posted shows that the Kurdish regional government did not even see the draft before it was passed by cabinet! If the Kurds are opposed then the game is up.

Sadr bloc joins Sunnis in rejecting Iraq oil law by Joseph Krauss
Thu Jul 5, 8:25 AM ET



BAGHDAD (AFP) - Followers of Iraqi Shiite cleric Moqtada al-Sadr on Thursday joined a growing chorus of Sunni Arab, Kurdish and Shiite opposition to a draft oil law backed by Washington.

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His opposition, apparently motivated by anger at the idea of US and British oil firms snapping up contracts after their countries invaded Iraq, promises to feed a fierce debate but will not necessarily derail the legislation.

"You cannot have both the Kurds and the Sadrists on the outside," said Joost Hiltermann, Iraq analyst at the International Crisis Group.

Nevertheless, "the oil law is one of the benchmarks that has a chance of success. It may not require the agreement of the Sadrists if there is agreement between the Supreme Council, the Dawa Party, and the Kurds."

"This is the same coalition that has essentially ruled Iraq since January 2005," Hiltermann added, referring to the Supreme Iraqi Islamic Council, a powerful Shiite party, and Prime Minister Nuri al-Maliki's Dawa party.

Amended draft legislation on the crucial distribution of oil wealth in Iraq was approved by Maliki's cabinet on Tuesday and could go to parliament for review as early as next week.

Oil exports are Iraq's single most important source of revenue, even after more than four years of insurgent attacks on oil facilities.

Its proven reserves, estimated at 115 billion barrels, are thought to be the third largest in the world, but since the March 2003 US-led invasion production has tumbled from 3.5 million barrels per day to around two million.

Sadr's supporters said they would not support any law that would allow firms "whose governments are occupying Iraq" -- a reference to the United States, Britain and their coalition allies -- to sign Iraqi oil deals.

"The most serious problem with the law is the production-sharing agreements, which we categorically reject," said Nassar al-Rubaie, spokesman for Sadr's 32-member parliamentary bloc.

Such agreements, which provide for foreign oil companies to share investment and profits with the state, would "undermine Iraq's sovereignty in the short run and will strip it of its sovereignty in the long run", he added.

The Kurdish Regional Government, on the other hand, has demanded that the new oil law accommodate contracts it has already signed with foreign companies to exploit oil in northern Iraq.

"The Sunni extremists and the Shiite extremists are against this law without even discussing it," Kurdish MP Mahmud Othman told AFP.

"They don't want any foreigners involved in the oil sector even though we need foreign companies to help us invest and develop these resources."

The dispute could set the stage for a realignment of Iraqi politics, with the Sadr bloc gathering a nationalist front to overrule the Kurds and pass a law that would limit foreign involvement in the country's oil industry.

"If there were a new coalition of nationalists that incorporated the Sadr movement and the Dawa party and Fadhila that could overcome the Supreme Council and the Kurdish parties," Hiltermann said.

The Supreme Iraqi Islamic Council, the Dawa party, and Fadhila, a smaller Basra-based party, all appear to support the bill.

Othman said as long as the new draft does not deviate from the draft the Kurds signed in February they would likely stay on board.

But if the bill passes amid boycotts by both the Sadr movement and the main Sunni parties it would do little to heal the country's war wounds.

"It should be discussed when all the blocs are there, because this concerns everyone, every citizen," Othman said. "These people should discuss it and if they have different points of view they should talk about them."