On the day that five foreign oil companies get their grubby hands on contracts to help develop Iraq’s oil, the NYT reveals that a small State Department team played an integral part in drawing up the contracts. The American government lawyers and private-sector consultants provided template contracts and detailed suggestions on drafting the contracts.
The disclosure is the first confirmation of direct involvement by the Bush administration in the Iraqi oil deals. It is, in the words of the Times, “likely to stoke criticism.” “We pretend it is not a centerpiece of our motivation, yet we keep confirming that it is,” Frederick D. Barton, a senior adviser at the Center for Strategic and International Studies told the Times. “And we undermine our own veracity by citing issues like sovereignty, when we have our hands right in the middle of it.”
Another leading critic of the Iraqi oil industry Greg Muttitt, from Platform in London, says that “even the most vehement opponents of oil privatisation do not object to such “technical service contracts” (TSCs): they are a normal model of business, where a company acts as contractor, providing a service to its client, a government or national oil company, for an agreed price.”
But peel beneath the surface, he argues “and the contracts start to look very strange. For a start, the deals are with the wrong companies. The companies which usually carry out TSCs are specialist service providers, like Schlumberger, Saipem or Baker Hughes. They are often hired in for geological, construction or drilling expertise, or to install a piece of technology.”
“In no other country are the likes of BP or ExxonMobil carrying out such TSCs”, says Muttitt. But then in no other country is the prize so big. Or been waited for, for so long. .