Iraqi Oil Minister Accused of Mother of All Sell-Outs
Thursday 18 June 2009
by: Patrick Cockburn | Visit article original @ The Independent UK
Furious protests threaten to undermine the Iraqi government's controversial plan to give international oil companies a stake in its giant oilfields in a desperate effort to raise declining oil production and revenues.
In less than two weeks, on 29 and 30 June, the Iraqi Oil Minister, Hussain Shahristani, will award service contracts to the world's largest oil companies to develop six of Iraq's largest oil-producing fields over 20 to 25 years.
Senior figures within the Iraqi oil industry have denounced the deal. Fayad al-Nema, the director of the South Oil Company, which comes under the Oil Ministry and produces most of Iraq's crude, said on the weekend: "The service contracts will put the Iraqi economy in chains and shackle its independence for the next 20 years. They squander Iraq's revenues." Mr Nema is reported to have since been fired because of his opposition to the contracts, which he says is shared by many other officials in Iraq's state-owned oil industry.
The government maintains that it is not compromising the ownership of Iraq's oil reserves - the third-largest in the world at 115 billion barrels - on which the country is wholly dependent to fund its recovery from 30 years of war, sanctions and occupation.
But the fall in the oil price over the past year has left the government facing a financial crisis; 80 per cent of its revenues go to pay for salaries, food rations and recurrent costs. Little is left for reconstruction and the government is finding it hard to pay even for much-needed items such as an electrical plant from GE and Siemens.
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