Iraq Draft Oil Law Approved
BAGHDAD, Iraq, Feb. 27--The Iraqi Cabinet approved draft legislation Monday to manage the country’s vast oil industry and divide its wealth among the population, a key US benchmark for progress in this country. According to AFP, the legislation now goes to parliament for approval.
posted by dion at 20:25
1 Comments:
Prime Minister Nouri al-Maliki announced the decision after the Kurds accepted the draft oil bill over the weekend--nearly two months after the government’s own deadline for enacting a new oil law.
Al-Maliki said the measures would be “another foundation stone“ in building a new Iraq, which relies on oil revenues for about 90 percent of its national budget. It was unclear when 275-member parliament will vote on the measure. The legislature reconvenes early next month.
All major parties have agreed to work for approval of the measure by May, but there are no guarantees in Iraq’s fractious, sectarian political system.
“The draft law represents a major breakthrough for Iraq’s economic and political transition,“ said Deputy Prime Minister Brahma Sale, a Kurd. “I very much hope the main political groups will rise to the occasion“ and approve the bill in parliament.
Iraq has some of the world’s largest petroleum reserves, and supporters hope the legislation will encourage major oil companies to invest billions--if the security situation improves.
Under the measure, revenues will be distributed to all 18 provinces based on population size--a concession to the Sunnis whose central and western homeland has relatively few proven reserves. Most of Iraq’s oil is in the Kurdish north and Shiite south, and many Sunnis fear they would be cut out of a fair share.
However, the bill had been bogged down for months in infighting between al-Maliki’s Shiite-led government and the self-ruled Kurdish administration of northern Iraq over who had the final say in negotiating contracts and managing the revenues.
Under the oil legislation, regional administrations will be empowered to negotiate contracts with international oil companies. The contracts will be reviewed by a central government committee in Baghdad headed by the prime minister.
A new law is needed, most outside experts believe, to encourage international companies to pour billions into Iraq to repair pipelines, upgrade wells, develop new fields and begin to exploit the country’s vast petroleum reserves, estimated at about 115 billion barrels.
According to Iraqis familiar with the deliberations, the draft law would offer international oil companies several methods to invest, including production-sharing agreements. Those would give US and other international companies a substantial share of the oil revenues to recover their initial investments and then allow them big tax breaks.
Post a Comment
<< Home