Iraqi cabinet endorses amended oil law

Iraqi cabinet endorses amended oil law
Iraq’s cabinet on Tuesday approved an amended draft oil law — a key plank to help unite the country’s warring communities — and was set to forward the bill to the parliament, a government spokesman said.
"The law has been endorsed during today’s cabinet meeting and it will be sent to parliament today," Ali al-Dabbagh told AFP.
The draft was amended by a government consultative committee which made "some linguistic amendments to the law" addressing the mechanisms to be used to share revenues among the country’s nearly 28 million people, he added.
The law, a key benchmark stressed by Washington to end the sectarian bloodshed in Iraq, aims to distribute revenues from crude oil exports equitably across 18 provinces and open the sector to foreign investors.
Ownership of Iraq’s vast oil reserves has been a subject of fierce debate among leaders from the country’s bitterly divided factions.
The bill was first approved in February but several powerful factions expressed reservations about the text, prompting further debate.
On the controversial question of foreign ownership, Dabbagh said the oil law will address the issue of production sharing on a "case by case basis."
"We usually seek best revenues for Iraqis when signing a contract," he said.
A number of foreign companies have already entered into contracts with the regional Kurdish administration in northern Iraq and fear that the new law may terminate those contracts.
Oil exports are Iraq’s single most important source of revenue, even after more than four years of frequent insurgent attacks on oil facilities.
Most oil production is in the Shiite south, but the best prospects for exploration are around the northern city of Kirkuk, which Kurds would like to incorporate into their largely autonomous region.
A referendum to settle the city’s fate is supposed to take place this year, but the city’s sizable Arab and Turkmen minorities are bitterly opposed to it, and have been pushing to delay the vote.
US officials have repeatedly urged the Iraqis to adopt a consensus law on sharing revenues and on international investment in order to head off future conflict and allow the oil sector to develop.
Iraq’s proven oil reserves, estimated at 115 billion barrels, are thought to be the third largest in the world, but since the US-led invasion production has tumbled from 3.5 million barrels per day to around two million.



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