tenmillion
07-02-2010, 05:42 AM
Issue No 27 2 - 8 July 2010
The Rumaila legal challenge shows why Iraq needs to quickly approve legislation to oversee its oil industry
Sheda Mosawi’s legal challenge to the Rumaila oil field licence came to a strange and somewhat subdued end this week. The outgoing parliamentarian brought the case against Prime Minister Nouri al-Maliki and Oil Minister Hussain al-Shahristani in December 2009.
Mosawi argued the award of the giant oil field in the Basra province violated Iraq’s constitution as it required the approval of both parliament and the provincial government, neither of which were involved in negotiating the contract. The deal was the first of 11 contracts awarded to international oil companies (IOCs) to develop the country’s oil and gas resources.
Mosawi was told by the courts to pay fees of more than $250,000 for consultants to study the technical issues related to the case – effectively shutting her down. The move has been seen as heavy handed in Iraqi legal circles.
IOCs may be relieved by the outcome of the case but they cannot have watched the proceedings of the case with much comfort.
Iraq has been without a hydrocarbons law since Saddam Hussein’s regime was toppled in 2003. The government has been unable to push through the key legislation that would define the roles of the oil ministry, local and central governments in deciding oil policy, as well as the role of IOCs in the sector.
There are quiet rumblings among Iraq’s political factions about the possibility of revisiting the oil contracts once a new government is formed. Ayad Allawi, the leader of the Iraqiya party, which topped the polls in Iraq’s March elections promised a review of the contacts if he become the next prime minister.
It could just be rhetoric but without a hydrocarbons law the worry will remain. Notwithstanding the ultimate prize of Iraqi upstream production, the legal and political risks in the country cannot be ignored.
http://www.meed.com/sectors/oil-and-gas/oil-upstream/hydrocarbons-law-is-a-priority-for-iraq/3007583.article
The Rumaila legal challenge shows why Iraq needs to quickly approve legislation to oversee its oil industry
Sheda Mosawi’s legal challenge to the Rumaila oil field licence came to a strange and somewhat subdued end this week. The outgoing parliamentarian brought the case against Prime Minister Nouri al-Maliki and Oil Minister Hussain al-Shahristani in December 2009.
Mosawi argued the award of the giant oil field in the Basra province violated Iraq’s constitution as it required the approval of both parliament and the provincial government, neither of which were involved in negotiating the contract. The deal was the first of 11 contracts awarded to international oil companies (IOCs) to develop the country’s oil and gas resources.
Mosawi was told by the courts to pay fees of more than $250,000 for consultants to study the technical issues related to the case – effectively shutting her down. The move has been seen as heavy handed in Iraqi legal circles.
IOCs may be relieved by the outcome of the case but they cannot have watched the proceedings of the case with much comfort.
Iraq has been without a hydrocarbons law since Saddam Hussein’s regime was toppled in 2003. The government has been unable to push through the key legislation that would define the roles of the oil ministry, local and central governments in deciding oil policy, as well as the role of IOCs in the sector.
There are quiet rumblings among Iraq’s political factions about the possibility of revisiting the oil contracts once a new government is formed. Ayad Allawi, the leader of the Iraqiya party, which topped the polls in Iraq’s March elections promised a review of the contacts if he become the next prime minister.
It could just be rhetoric but without a hydrocarbons law the worry will remain. Notwithstanding the ultimate prize of Iraqi upstream production, the legal and political risks in the country cannot be ignored.
http://www.meed.com/sectors/oil-and-gas/oil-upstream/hydrocarbons-law-is-a-priority-for-iraq/3007583.article