EMAIL
PRINT
17 COMMENTS
Got a tip for a post?:
Email us | Anonymous form
After all that, it looks like the Iraqis are cutting some big deals to develop their massive oil wealth -- but with the mushy Europeans and the damn Chi-coms!
Iraq's Oil Minister Hussain al-Shahristani told a Washington conference on Wednesday that his government was happy with the energy auction it held earlier this year. The auction was the first chance for foreign oil firms to compete for Iraqi oil since the U.S.-led invasion in 2003.
BP and the Chinese oil company CNPC were the only firms to win a contract in Iraq's bid round this summer, the first chance for foreign oil firms to compete for Iraqi oil since the U.S.-led invasion in 2003. Seven other oil and gas fields failed to attract bidders on the terms Iraq offered.
But a consortium headed by Italy's ENI (ENI.MI: Quote, Profile, Research) said last week it signed a deal to develop the giant Zubair field for a remuneration fee of $2 a barrel. At Iraq's oilfield auction in June, the consortium refused to go below $4.40 a barrel.
Another consortium headed by Exxon is still in the running for one project, but that doesn't mollify hedge-fund gazillionaire -- and natural gas honcho -- T-Boone Pickens. He's none-too-happy:
Oil tycoon T. Boone Pickens told Congress on Wednesday that U.S. energy companies are "entitled" to some of Iraq's crude because of the large number of American troops that lost their lives fighting in the country and the U.S. taxpayer money spent in Iraq.
[...]
"They're opening them (oil fields) up to other companies all over the world ... We're entitled to it," Pickens said of Iraq's oil. "Heck, we even lost 5,000 of our people, 65,000 injured and a trillion, five hundred billion dollars."
[...]
"We leave there with the Chinese getting the oil," Pickens said.
Nothing new -- In August T-Boone called on the administration to "demand" oil contracts from Iraq before considering a withdrawal ($$). But it is an unusually brazen admission that many energy bigs did in fact consider "blood-for-oil" to be a straightforward deal.
While I discount mono-causal explanations for why we went to war, access to Iraq's oil -- or depriving our rivals of that access -- was a prime reason for the invasion, and (as I wrote here and here), Big Oil's machinations did much to bring it about.
And what has always struck me about this proposition is how bizarre that kind of mercantilism is in a globalized world. After all, what is an "American" energy company anyway? These giants may be headquartered in the U.S. (where they get all sorts of sweet tax breaks), and their top management may be American -- folks like T-Boone Pickens. A majority of their profits may end up in Americans' accounts, but at the end of the day they're multinationals owned by investors from around the world.
So, let's look more closely at T-Boone's premise that "we're" entitled to Iraq's oil because "we" paid a dear price in blood and treasure to "liberate" it.
Most Americans won't gain a thing if Iraq's oil is firmly in the hand of "American" oil companies-- it's a global energy market and whether a barrel of oil is controlled by Exxon or Lukoil doesn't impact its price on that market. A relatively small number of Americans would benefit -- Big Oil's employees, shareholders and the employees and shareholders down its U.S.-based supply chain.
A relatively small number of Americans have paid a huge price in Iraq directly. Not just the 4,300 killed or 31,500 physically wounded, but the entire million-plus who have served there at one point or another.
So a small group would make (sometimes) huge gains if "we" had the loot, and another small group would have paid a huge direct price for those gains. But all of us who pay taxes are picking up a huge tab -- a loss of national treasure that will be staggering by the time the last disabled vet is laid to rest decades from now.
And of course the ultimate price for the gains of T-Boone and his oil buddies will have been paid by the Iraqis -- millions of them have been killed, internally displaced or sent fleeing to other countries to live as refugees and all of them continue to live under the weight of constant civil conflict.
That's how the winners and losers shake out. And when you think about it that way Pickens' whining is simply shameless.
No comments:
Post a Comment