Picture Credit: The Independent |
Iraq has the world's second largest proven oil reserves. According to oil industry experts, new exploration will probably raise Iraq's reserves to 200+ billion barrels of high-grade crude, extraordinarily cheap to produce. The four giant firms located in the US and the UK have been keen to get back into Iraq, from which they were excluded with the nationalization of 1972. During the final years of the Saddam era, they envied companies from France, Russia, China, and elsewhere, who had obtained major contracts. But UN sanctions (kept in place by the US and the UK) kept those contracts inoperable. Since the invasion and occupation of Iraq in 2003, much has changed. In the new setting, with Washington running the show, "friendly" companies expect to gain most of the lucrative oil deals that will be worth hundreds of billions of dollars in profits in the coming decades.
The Iraqi constitution of 2005, greatly influenced by US advisors, contains language that guarantees a major role for foreign companies. Negotiators hope soon to complete deals on Production Sharing Agreements that will give the companies control over dozens of fields, including the fabled super-giant Majnoon. But first the Parliament must pass a new oil sector investment law allowing foreign companies to assume a major role in the country. The US has threatened to withhold funding as well as financial and military support if the law does not soon pass. Although the Iraqi cabinet endorsed the draft law in July 2007, Parliament has balked at the legislation. Most Iraqis favor continued control by a national company and the powerful oil workers union strongly opposes de-nationalization. Iraq's political future is very much in flux, but oil remains the central feature of the political landscape.
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Analysis
Oil in Iraqi History
Status of Forces Agreement (August 9, 2008)
Noam Chomsky argues that since World War II, the US has wanted to control Iraq's huge oil resources, which prompted the US to invade Iraq in 2003. As the world's oil resources are diminishing, the US seeks control over Iraq's oil to secure its global power and influence. (Chomsky.info )
How the Bush Administration's Iraqi Oil Grab Went Awry (September 25, 2007)
Iraq Oil Lobbying Comments on the Confidential Document (July 14, 2006)
Crude Designs: the Rip-off of Iraq's Oil Wealth (November 22, 2005)
The Iraq Oil Bonanza: Estimating Future Profits (January 28, 2004)
Confidential Government Document on Iraq Oil Lobbying by Australian Firm (May 20, 2003)
Click here to view the original document from the website of the Cole Inquiry.
Oil Companies in Iraq: A Century of Rivalry and War (November 2003)
James A. Paul analyzes the power and influence of US and UK oil companies. He discusses their century-long interest in Iraqi oil and the likelihood that control of Iraq's huge oil reserves drove seven wars, including the 2003 conflict. (Global Policy Forum)
Iraq: the Struggle for Oil (August, 2002)
Oil in Iraq: the Heart of the Crisis (December, 2002)
Articles
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2013
Iraq at the Brink: A Decade after the Invasion (February 14, 2013)
A decade after the US-led invasion of Iraq, Iraqi citizens struggle to find a uniting vision. A violent war-legacy, Western interests, regional power plays and bitter sectarianism continue to divide Iraq. Sectarian strife has flared once again, with the ruling Shi’ites and Kurds accused of carrying out attacks against Sunnis. In return, the Sunni population is staging mass protests and strikes against political inequality, and demanding the end of Sunni disfranchisement under the new political system. Furthermore, business elites are taking advantage of the country’s divisions. Disputes between the Iraqi and Kurdish government grow over the control of oil fields. Both governments have amassed troops around the oil rich Kurdish region. Tensions are exacerbated by multinationals, such as Exxon, which has bypassed the central government in Baghdad to make lucrative oil and gas deals.
2011
Time to Move on: Iraq's Oil and Gas Impasse Explained
The controversial contract signed by oil giant Exxon with the semi-autonomous state of Kurdistan has created severe tensions between the government in Baghdad and Kurdistan. This “landmark deal” authorized Exxon to develop oil and gas in six blocks in the northern region. The deal was sealed with a law which had not been approved by Iraq’s federal authorities, and the uproar that followed demonstrates that Iraq is in an urgent need for a new oil and gas law. New legislation is crucial for Iraq’s future and for the stability of the region. (Niqash)
Iraqi Oil: Transparency and Corruption (September 26, 2011)
In Iraq, corruption and foreign occupations go hand in hand. Corruption within the Ministry of Oil (MoO) in Iraq is widespread and the level of transparency is extremely low. Corruption gave US administrations the support they needed to get Iraqi groups to sustain Washington’s efforts in privatizing and controlling Iraq’s natural resources. International Oil Companies and foreign National Oil Companies that operate in the country are just as corrupt as the Iraqi government. Transparency International World corruption index has put Iraq as the fourth most corrupt country in the world, out of 178 surveyed. (Znet)
Iraq’s New Oil Contract: Grand Theft and Local Collusion (September 6, 2011)
Journalist Alaa al-Lami asserts that Iraq’s infamous oil wealth was the primary reason for the Iraq war eight years ago. This article follows the subsequent pillaging of the oil funds by both US and Iraqi military and political authorities as well as the widespread smuggling of oil into Kuwait. Al-Lami asserts that further exploitation of Iraq’s oil money has also been encouraged through the withholding of finances into the Iraqi Development Fund. This casts doubt onto the commitment to reconstruction by both the US and Iraq as funds, when released, may risk being pilfered by corrupt Iraqi officials or international powers. (Al Akhbar)
Where’s Our Missing $17bn? Iraq Demands Return of Oil Money ‘Stolen by US Institutions after 2003 Invasion’ (June 20, 2011)
Iraq has requested UN assistance in locating $17billion in oil money it says was stolen by US institutions in the wake of the 2003 invasion. The Iraqi parliament Integrity Committee called the disappearance of the money a 'financial crime' but said UN Security Council resolutions prevent Iraq from making a claim against the US. The money came from the sale of Iraqi oil, surplus funds from the UN oil-for-food program and seized Iraqi assets. The money was intended to be used to pay the salaries and pensions of Iraqi government workers and for reconstruction projects. Last July, an audit report from the US Special Inspector General for Iraq Reconstruction admitted the US Department of Defense was unable to account properly for $8.7billion of Iraqi oil and gas money. (Daily Mail)
The empire strikes again: Sex, oil, chaos and corruption at the American University of Iraq (February 16, 2011)
This story exposes the sordid history of the American University of Iraq-Sulaimaniya. Located in Kurdistan and first opened in 2007, AUI-S rapidly received accreditation and has since been beset by scandals and allegations of corruption. Students, former employees and other critics accuse the school of shoddy scholarship, ties to oil tycoons and political propagandizing. The story explores how AUI-S was founded primarily to promote oil and political interests, under the guise of an avant-garde teaching institution. (Salon)
2010
UN Oversight of Iraqi Oil Money Struggling to Adapt (July 28, 2010)
The UN-appointed International Advisory and Monitoring Board (IAMB), which has been overseeing Iraq's oil export revenue since 2003, is facing criticism once again. The principle role of the IAMB was to ensure that the Development Fund for Iraq was used transparently for the benefit of the Iraqi population - a role it clearly failed to fulfill. Now, as reports of illegal oil exports to Iran emerge and the semiautonomous Kurdistan Regional Government strikes oil deals independently of the Iraqi central government, the IAMB's lack of investigative muscle and enforcement power is receiving greater media attention. (Iraq Oil Report)
Iraqi Electricity Union Offices Raided Under Draconian Decree (July 26, 2010)
The Iraqi Minister of Oil and Electricity issued a decree on July 20, 2010 banning trade unions in the energy sector; electricity union offices in Iraq have already been raided under this new law. Anti-labor and anti-union laws are relics from the Sadaam era which were strategically kept in place by the US to minimize challenges to the occupation and the oil sector in particular. They are a violation of ILO Conventions to which Iraq is signatory and are also undermining the Iraqi constitution, which calls for the enactment of a basic labor rights law. (In These Times)
Prospects Abound Among the Kurds (July 15, 2010)
US Companies Join Race on Iraqi Oil Bonanza (January 14, 2010)
US companies, including Halliburton, Baker Hughes, Weatherford International and Schlumberger, have arrived in Iraq to pursue rebuilding contracts which could total $10 billion over the next five years. As the Iraq government will administer the contracts directly, a system of transparency and accountability is necessary. But Iraq is notoriously corrupt and it lacks experienced managers, auditing systems and reliable enforcement. So it seems doubtful that Iraq can properly monitor these contracts - with companies already known for their bad Iraq performance in the past. (New York Times)The Legality of Iraqi Oil Contracts Remains Questionable (January 11, 2010)
2009
Oil Auction in Iraq Today (December 11, 1009)
The latest round in Iraq's oil auction took place on December 11, 2009. Foreign oil companies had been holding out for the most lucrative contracts, but as the Iraqi oil law fades from sight, the oil companies sat down at the negotiating table in November. The latest December round marked the last step in an oil revolution which has placed the majority of oil production in foreign hands for the first time in three decades. (Huffington Post)
Slideshow (December 11, 2009)
Click here to view photos of Iraq's November 2009 oil deals here.
Iraq Oil: Are the 1st and 2nd Bid Rounds Part of a Wise Resource Development Strategy or Could They Turn Out to be Steps in the Wilderness? (November 15, 2009)
Munir Chalabi assesses the first and second rounds of Iraq's oilfield bidding. He concludes that the Iraqi oil ministry should be initially creating an overall policy which takes into account Iraq's priorities. The first and second round will not rebuild and develop an independent Iraqi oil and gas industry but will give increasing power to International Oil Companies who will soon be in control of 95% of Iraq's oil output. (Znet)
Did Big Oil Win the War in Iraq? (November 14, 2009)
Back in 2003 Britain and the US were shut out from the oil-producing contracts Saddam Hussein's government was negotiating. The contracts BP and ExxonMobil negotiated last week reflect the extent to which British and US "big oil" companies have gained from the war. But the biggest "prize" of all, the passing of the Iraq oil law, which would surrender power to the foreign companies to the detriment of the Iraqi people, remains out of reach. (Alternet)
Outcry Against "Colonial" Takeover by BP of Rumaila Oilfield in Iraq ( November 4, 2009)
British Petroleum and CNPC - a major Chinese company - have signed an agreement with the Iraqi Oil Ministry to develop the Rumaila oil field. The contract gives the companies $2 for every barrel extracted. Although ownership of the field remains in Iraqi hands, BP's involvement has sparked accusations of "colonialism". On a different level, several Iraqi MPs believe the deal is illegal, claiming that parliament, rather than the Oil Ministry, should have the final say in oil transactions. (The Times)
Pickens Says US Firms "Entitled" to Iraqi Oil (October 23, 2009)
Oil tycoon T. Boone Pickens has complained to Congress that the Iraqi government has not awarded oil deals to US companies and has awarded contracts to non-US firms. He claimed that in light of the US soldiers killed in Iraq, and US dollars spent there, US companies are "entitled" to Iraqi oil. (Reuters)
New Information in the Tawke-Gate Affair: Galbraith Was Also a Paid DNO Consultant (October 19, 2009)
US diplomat Peter Galbraith was a paid consultant to the Norwegian oil company, DNO, earning $200,000 from May through November 2004. This revelation adds yet another element to the question of whose interests Galbraith was serving - those of the Kurds or those of Western investors. The Kurds and the Iraqis are currently suffering from the extreme federalism supported by Galbraith, particularly in the oil sector. (Historiae)
Galbraith Confirms Oil Interests in Kurdistan (October 15, 2009)
While He Was Influencing the Shape of the Iraqi Constitution, Peter Galbraith Held Stakes in an Oilfield in Dahuk (October 10, 2009)
Left Behind by Iraq's Oil Rush (September 20, 2009)
Iraqi Oil: The Influence of the 1st Bid Round on the Future of Iraq's National Oil and Gas industries (July 17, 2009)
Iraq's Weakened Unions Fight Foreign Oil Firms (July 13, 2009)
Eager to Tap Iraq's Vast Oil Reserves, Industry Execs Suggested Invasion (July 3, 2009)
Views on the Prospects of Iraq's Oil and Gas Resources (March 21, 2009)
Iraq as the First 'Resource War' of the Century (February 12, 2009)
2008
Iraq Lawmakers Say Will Challenge Shell Gas Deal (November 25, 2008)
In Final Days, Bush Pushes for Iraq's Oil (November 11, 2008)
Shell Secures 25-year Access to Iraq's Oil, Gas (November 7, 2008)
Shell has secured a 25-year contract with the Iraqi government giving the oil giant control of the production and the export of natural gas in southern Iraq. Shell will be the sole gas company to operate in southern Iraq and Iraqi MP Jabir Khalifa Jabir argues that the agreement "is a long term monopoly that allows Shell to export gas when Iraq is in need of that gas." (United Press International)
In Biggest Oil Sale Ever, Iraqi Government to Put 40 Billion Barrels of Reserves Up for Grabs (October 13, 2008)
Pentagon Hands Iraq Oil Deal to Shell (October 2, 2008)
Shell Becomes First International Oil Firm to Open Baghdad Office since '70s (September 23, 2008)
The Draft Iraqi Oil Law: Making a Mockery of Sovereignty (September 9, 2008)
This Jurist article examines how the proposed Iraqi draft oil law would take sovereignty from the Iraqi State and give control over the majority of Iraqi oil resources to foreign companies such as Exon Mobil, Shell, and BP. Foreign oil companies in Iraq stand to make enormous profits at the expense of the welfare of Iraq's people.
The US Gas Garrison (July 11, 2008)
Ever since President Franklin D. Roosevelt promised to protect Saudi Arabian royalty in return for privileged US access to Saudi oil, US governments have regarded access to overseas oil supplies a matter of "national security." Troops have guarded pipelines and refineries and the US has engaged in wars to secure their sources of energy. This article from Le Monde diplomatique argues that the US should change its tactics, end its warfare in the Middle East and instead create an energy policy with focus on domestic, renewable sources of energy.
Bush-Cheney Crony Got Iraq Oil Deal (July 13, 2008)
Bush and Cheney Always Saw Iraq as a Sweetheart Oil Deal (July 12, 2008)
This article by Noam Chomsky states that the main goal of the US in Iraq was to open its oil resources to foreign investment. Bush has continually signed agreements to secure an indefinite US military presence in Iraq. Extensive resort to "signing statements" to expand executive power is yet another Bush innovation, condemned as "contrary to the rule of law and our constitutional separation of powers." (Khaleej Times Online)
It Was Oil, All Along (July 6, 2008)
US Advised Iraqi Ministry on Oil Deals (June 30, 2008)
The Bush administration is working behind the scenes to ensure Western access to Iraqi oil. US government lawyers and private-sector consultants have provided templates and detailed suggestions on drafting the much criticized contracts between the Iraqi governments and five major Western oil companies. The companies will be working some of the largest fields in Iraq, although critics warn that meddling in the country's oil policies can inflame the opinion of Arab nations against the US. (New York Times)
Oil Sell-Off by Stealth (June 26, 2008)
Iraq may lose a large amount of its national revenue to five Western oil corporations that will enjoy direct access to the country's largest oilfields. The lucrative deal has been drawn up by the corporations themselves, who wrote the contracts without input from the Iraqi government. The businesses have ensured their right to match any competing bid once the two year-contracts run out. They will have a claim to long-term control over at least one third of Iraq's known oil reserves. (Niqash.org)
Deals with Iraq Are Set to Bring Oil Giants Back (June 19, 2008)
After a 36 year absence, four Western oil companies are returning to Iraq. Exxon Mobil, Shell, Total and BP lost their oil concession as Saddam Hussein rose to power, now, with US support they have negotiated new contracts with Iraq's Oil Ministry. Due to Iraq's vast resources, these oil companies expect to profit immensely from the renewed deals yet claim their investments will also help rebuild the country's decrepit industry. (New York Times)
Oil for War (March 10, 2008)
Foreign Firms Seek Iraq Oil Deals (February 18, 2008)
In the aftermath of the US-led invasion of Iraq, over seventy oil firms have applied for the right to develop Iraq's oil. With the third largest oil reserve in the world, Iraq has unsurprisingly received bids from "established oil firms with plans for years to gain access to these natural resources." Foreign oil companies are not the only ones concerned with the reserves; Iraqi legislators and the government in Baghdad have yet to resolve questions over who will control the oil. (Al-Jazeera)
2007
Iraqis Make Statement Against Oil Theft (November 26, 2007)
In this letter to the Iraqi Parliament, 60 Iraqi Oil Professionals announce their support for the Ministry of Oil's decision to make illegal 15 production sharing agreements signed by the Kurdistan Regional Government (KRG) and foreign companies. The professionals agree with the blacklisting of the foreign companies in question. This letter follows similar warnings by the group in early 2007 that the negotiation and signing of oil contracts remain exclusively with the Ministry. The letter further asks that the draft oil law be approached with caution and that it be amended to ensure the rights of Iraqis. (After Downing Street)
Long-Term Presence Planned at Persian Gulf Terminals Viewed as Vulnerable (November 12, 2007)
The US Navy is constructing a military installation on one of two Iraqi petroleum-export platforms in the Persian Gulf. The Khwar Al Amaya oil terminal and the Al Basra oil terminal have the potential to load almost 2.4 percent of the world's daily oil needs. Commentators suggest the construction signals US intentions to establish long term bases in the region, with particular interest in protecting Iraq's oil industry. Some commentators suggest the installation will also allow the US to monitor Iran's Revolutionary Guards Corps who are stationed near Khwar Al Amaya. (Wall Street Journal)
Iraq, With US Support, Voids a Russian Oil Contract (November 5, 2007)
The Iraqi government cancels a contract with the Russian oil company, Lukoil, for development of the supergiant West Qurna oil field. In response, Russia threatens to retract a promise to forgo Iraq's US$13 billion debt. Lukoil claims a contract signed with Saddam Hussein is still valid despite the former Iraqi leader canceling it. Since the occupation, the Iraqi government has honored other contracts with Chinese, Indonesian and Indian oil companies. Russia argues that with US pressure, the Iraqi government is selectively enforcing contracts. (New York Times)
Why Did We Invade Iraq Anyway? (October 30, 2007)
The White Man's Burden and ‘Oil for Peace' in Iraq (October 21, 2007)
Two conferences on Iraq's oil were held simultaneously in September 2007. In Dubai, big international oil companies declare Iraq as "open for business," while in Basra, workers, experts and civil society leaders argue that the "oil belongs to the Iraqi people." The author of this Carbon Web Newsletter article suggests the meetings demonstrate the great divide between what Iraqis want and what the oil law will actually provide. Further, while the US claims the law will allow for political reconciliation, the author notes that the law barely mentions revenue sharing.
Iraq's Workers Strike to Keep Their Oil (September – October, 2007)
The Iraqi Federation of Oil Workers (IFOU) is the main opposition to the privatization of oil in the country and is one of few voices speaking out the rights of millions of Iraqi workers. In June 2007, the Union organized a strike which, although short lived, resulted in Prime Minister Nouri al-Maliki agreeing to delay the implementation of a controversial oil law until October 2007. Despite heavy pressure from the US, the oil law has not yet passed parliament. Commentators suggest the union represents a large threat to the Bush administration's goal of privatizating Iraq's oil. (Dollars and Sense)
Black Gold Turns Grey as Western Giants Prepare to Draw from the Wells of Iraq (September 30, 2007)
Greenspan, Kissinger: Oil Drives US in Iraq, Iran (September 17, 2007)
Greenspan: Ouster of Hussein Crucial for Oil Security (September 17, 2007)
The Battle for Iraq Is About Oil and Democracy, Not Religion! (September 10, 2007)
Commerce Seeks Adviser for Iraq Oil Interests (September 10, 2007)
Missteps and Mistrust Mark the Push for Legislation (September 5, 2007)
What Is Holding Up the Delivery of the Long-Awaited Iraqi Oil Law? (August 22, 2007)
Oil Giants Rush to Lay Claim to Iraq (August 19, 2007)
Why Iraqis Oppose US-Backed Oil Law (August 19, 2007)
Iraq's Oil Workers Union strongly opposes Iraq's draft oil law. The Union has popular support and is a symbol of national unity in an otherwise divided country. However, Washington insists that opposition to the oil law is evidence of a weak Iraqi government. In response, Prime Minister Nouri al-Maliki has banned collective bargaining, seized union funds, imposed low wage laws and ignored assassinations against union leaders. One labor leader in Iraq suggests "war makes privatization easy: First you destroy society, then you let the corporations rebuild it." (San Francisco Chronicle)
What Unites Iraqis: Blocking Western Petroleum Companies From Seizing Control of Their Oil (August 9, 2007)
Chevron, Total in Services Pact on Iraq Majnoon Field-Sources (August 8, 2007)
Iraqis Oppose Oil Development Plans, Poll Finds (August 6, 2007)
Top Iraq MP: No Oil Law under Occupation (August 3, 2007)
Good News from Baghdad at Last: The Oil Law Has Stalled (August 3, 2007)
Iraqi Oil Minister Enforces Saddam Law on Trade Unions (August 2, 2007)
No Law For Oil (August 2007)
Slick Connections: US Influence on Iraqi Oil (July 17, 2007)
Iraqis Protest Oil Law (July 16, 2007)
Led by the Iraqi Federation of Oil Unions (IFOU), hundreds of Iraqis took to the streets to protest the proposed hydrocarbon law and a hike in fuel prices. The IFOU also called on Parliament to legalize trade unions and to establish workers' rights. Observers charge that the draft law would not serve the interests of the Iraqi people, as it would divert oil revenues from Iraq's economy to foreign companies. (US Labor Against the War & Oil Change International)
Iraqi Unions Fight the New Oil Law (July 9, 2007)
Australia "Has Iraq Oil Interest" (July 5, 2007)
Australian Prime Minister – and staunch US ally – John Howard supported the invasion of Iraq, purportedly to "give the people of Iraq a possibility of embracing democracy." But Defense Minister Brendan Nelson invalidates such justifications for the war, conceding that oil interests hugely motivated Australia's involvement in Iraq. (BBC)
Blood, Sweat and Oil (July 2007)
Iraqi Union Leader Urges Opposition to Oil Law (June 18, 2007)
Iraq's Workers Strike to Keep Their Oil (June 2007)
The Iraqi Federation of Oil Unions went on strike in opposition to the proposed hydrocarbon law. Prime Minister Nouri al-Maliki responded forcefully by sending the army and issuing arrest warrants against the union's leaders. Iraqi unions are a strong, secular voice against oil privatization and the occupation in general. (truthout)
What Congress Really Approved: Benchmark No. 1: Privatizing Iraq's Oil for US Companies (May 26, 2007)
Losing Fuel (May 25, 2007)
Iraqis Resist US Pressure to Enact Oil Law (May 13, 2007)
Billions in Oil Missing in Iraq, US Study Says (May 12, 2007)
The Struggle over Iraqi Oil (May 8, 2007)
Violence Threatens Oil (April 13, 2007)
Mystery of Missing Meters: Accounting for Iraq's Oil Revenue (March 22, 2007)
Whose Oil Is It, Anyway? (March 13, 2007)
Foreign Office Helped Set Up Iraqi Oil Deals (March 11, 2007)
BG Spearheads Move to Tap Iraq's Riches (March 10, 2007)
Cabinet Readies Iraqi Oil for Privatization (February 27, 2007)
The Iraqi Cabinet approved a hydrocarbon law that will allow foreign companies to control Iraq's vast oil resources. In order to avoid controversy, the term Production Sharing Agreements was replaced by Exploration and Risk Contracts, but both mean that Iraq is renouncing its sovereignty and handing over exclusive rights and huge profits to private oil companies. According to Ewa Jasiewicz, a researcher at PLATFORM, "the law's unfair, untransparent and undemocratic provisions reflect the influence and interests of external actors, namely the US and British governments and their major oil companies."
Iraqi Oil Wealth Stays Locked Up (February 20, 2007)
The revised draft of the Iraqi oil law is expected to go to the Parliament for debate and ratification, if approved by the Iraqi cabinet. Nevertheless, this law still faces controversy. A key trade union of oil workers declared it would oppose the law, claiming the legislation was "unbalanced and incoherent with the hopes of those who work in the oil industry." Former Iraqi oil officials are also against this law and according to one of them "rushing through a petroleum law could cause more harm then good to the industry." (Wall Street Journal)
Iraq Oil Technocrats: Time Not Suitable for Oil Law (February 17, 2007)
Iraqi Leaders Still Wrangling Over Hydrocarbon Law (January 9, 2007)
Observers expect the Iraqi Parliament to pass legislation re-shaping the country's oil industry. However, because of differences between Iraq’s federal and local governments, this Dow Jones article foresees a possible delay of several months in the passage of the law. The semi-autonomous Kurdish region in northern Iraq has already signed agreements with small oil companies, and the central government in Baghdad fears that this could set a precedent in the oil-rich South. Further, no consensus exists on the sharing of oil revenues, the types of contracts to award foreign oil companies and the creation of the Iraqi National Oil Company. These issues could lead to further opposition to the occupation.
Future of Iraq: The Spoils of War (January 7, 2007)
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