Yeah we are not profiting from their oil. No bid contracts are NOT advantageous. We did a good thing for the Iraqis and gave them democracy allowing their representatives to sell their own people's resources out to the
highest bidder
http://www.nytimes.com/2008/07/01/world/middleeast/01iraq.html?scp=2&sq=iraqi+oil+contracts&st=nytBAGHDAD — Iraq announced Monday that it was opening six key oil production fields to more than 30 foreign companies, while delaying an announcement on a series of no-bid consulting contracts with a handful of Western oil companies.
Related
Iraq Sues Companies Over Oil-for-Food Program (July 1, 2008)
Iraq’s oil minister, Hussain al-Shahristani, speaking at a news conference here, said Iraq would begin taking bids later this year for longer-term contracts on six of its oil fields. Thirty-five foreign companies have qualified to participate. Winners will be announced in 2009, Mr. Shahristani said.
Iraq hopes to almost double its production, to 4.5 million barrels of oil a day over the next five years from the current 2.5 million barrels, Mr. Shahristani said. The contracts are aimed at helping the country do that.
Iraq had been expected on Monday to issue its first contracts to foreign oil companies that would provide technical support and help raise Iraqi oil production ahead of awarding lucrative long-tern contracts.
Those initial short-term contracts, with Exxon Mobil, Shell, Total, BP and Chevron, are still under negotiation, a person close to the talks said, and will probably be completed in the next month.
The reason for the delay was unclear.
Chevron said in a statement that it was “continuing to negotiate” with the Oil Ministry on the short-term technical contract on an oil field called West Qurna, which is currently producing.
“The ministry has separately announced a tender for full field development and Chevron has been prequalified to participate in that bid round,” the company said.
Mr. Shahristani defended the way Iraq has handled the oil contracts, which have led to criticism in the Arab world and abroad, where suspicions run rampant that the United States-led invasion was at least partly about access to Iraq’s oil.
The initial contracts are expected to be awarded without competitive bidding, but Mr. Shahristani told the news conference, “There will be no privilege for any of those companies to participate in future contracts.”
Bloomberg News quoted the chief executive of Shell, Jeroen van der Veer, as saying at the World Petroleum Congress in Madrid that the company expected to sign oil agreements with Iraq in “a matter of weeks.”
A major legal question hangs over the process: Iraq has yet to pass a law that divides oil revenue among all parts of the country.
Iraq has some of the largest oil reserves on earth, but they are largely untapped because the country has long lacked the resources to develop them. The companies will provide equipment and expertise to refurbish the country’s aging infrastructure.
The six fields “are producing now, but there is a need for development because they were established years ago,” Mr. Shahristani said.
Iraqis interviewed on Monday said profit from oil was the business of the country’s most powerful politicians, as well as the United States, and ordinary people got little benefit from it
“The income won’t come to me,” said Abu Riyam, a 42-year-old engineer who was shoe shopping with a relative in central Baghdad. “They won’t build houses or hospitals with it.”
Despite Iraqi skepticism, oil accounts for nearly all of Iraq’s revenue, and provides salaries for public sector employees as well as financing for most public works projects.
Other Iraqis were more hopeful.
“American technology is the best in the world,” said Salah Mahmood, a 45-year-old cab driver in Basra, Iraq’s second-largest city and the center of oil production for the country. “Why would we reject these contracts?”
Also on Monday, a spate of violence against judges escalated sharply. Bombs exploded in front of the houses of four judges from the Court of Appeals in largely-Shiite eastern Baghdad, a spokesman for the court said.
A fifth judge discovered a bomb in his car as he was leaving the same court Monday afternoon. An Interior Ministry spokesman said the bomb exploded and the judge, Hassan Fuad, was wounded.
The attacks seemed to be calculated to intimidate rather than to kill. It was not clear who was responsible.
“This is an attack to destroy the state itself,” said Wail Abdul Latif, a member of Parliament who worked as a judge for decades. “These judges were far from sectarianism and politics.”
In addition, bombs exploded in Mosul, in northern Iraq, and near a police station in a town called Mandli in Diyala Province in eastern Iraq, killing two and wounding more than 20, the authorities said.
