Source: The Economic Times - 20/07/2009
Iraq parliament can halt oil contracts: Speaker Iraq parliament can halt oil contracts:
Iraq's parliament has the authority to block a contentious oil deal with BP and China's CNPC, despite the oil ministry's insistence
lawmakers can do nothing to derail the agreement, a top lawmaker said.
"The government believes that such a subject is included in its authorities, according to existing law, but if parliament finds these contracts or this (bidding) round ... are not beneficial, parliament can prevent the government," parliament speaker Ayad al-Samarai said in an interview on Sunday.
"Parliament can stop the government and its decision would be binding," Samarai said.
Like so much else in Iraq, where the government was rebuilt from scratch after Saddam Hussein's ouster and lawmakers are struggling over long-delayed reforms to a 2005 constitution, there are countless murky areas of law and governance, often involving competing claims of authority.
Such is the case with Oil Minister Hussain al-Shahristani's plans for forging deals with the world's biggest energy firms in a bid to resurrect Iraq's oil sector, rich with potential but shackled by years of neglect, sanctions and war.
Iraq has the world's third largest oil reserves, but even six years after the US-led invasion, production lingers around pre-invasion levels of around 2.5 million barrels per day.
Criticism of Shahristani's management of Iraq's vast oil wealth came to a head as the minister planned a June 30 energy auction in which he offered the world's biggest energy firms contracts to develop up to eight major oil and gas fields, most of them already in production.
Only one deal came out of that auction -- BP and partner China National Petroleum Corp won the right, after taking a big cut in what it proposed to pay originally, to develop the southern Rumaila field over a 20-year period.
Now, some members of parliament say the contract, due to be signed in August, will be illegal without parliamentary approval, adding to criticism from some in the state-run oil industry who chided Shahristani for putting fields already in production on the auction block.
There are also some unions threatening strikes and sit-ins, charging that the Rumaila deal is illegal because it was passed without new national oil and gas legislation. The law has been held up for years by a bitter feud between Arabs and Kurds.
In the absence of a new law, the ministry is operating under Saddam-era legislation, but no one can agree on what that means.
Government spokesman Ali al-Dabbagh said that the oil ministry considered such contracts "an executive matter."
"The ministry does not see that the constitution requires it to gain parliament's approval for these agreements," he said.
Many lawmakers, especially minority Kurds who assail plans to auction off fields in disputed areas, disagree.
"I believe that parliament will ask the government to bring them a copy of these contracts ... and will ask the government to hold off on signing the contracts until parliament has had its say," said Samarai, a senior figure in the Accordance Front, Iraq's largest Sunni Arab bloc.
Shahristani is planning a second auction near the end of the year, this time hoping to award deals for 11 oil and gas fields that have not yet been developed.
Samarai said Shahristani may be summoned to parliament for another round of questioning about the oil sector following an earlier appearance in June.
Iraq parliament can halt oil contracts: Speaker Iraq parliament can halt oil contracts:
Iraq's parliament has the authority to block a contentious oil deal with BP and China's CNPC, despite the oil ministry's insistence
lawmakers can do nothing to derail the agreement, a top lawmaker said.
"The government believes that such a subject is included in its authorities, according to existing law, but if parliament finds these contracts or this (bidding) round ... are not beneficial, parliament can prevent the government," parliament speaker Ayad al-Samarai said in an interview on Sunday.
"Parliament can stop the government and its decision would be binding," Samarai said.
Like so much else in Iraq, where the government was rebuilt from scratch after Saddam Hussein's ouster and lawmakers are struggling over long-delayed reforms to a 2005 constitution, there are countless murky areas of law and governance, often involving competing claims of authority.
Such is the case with Oil Minister Hussain al-Shahristani's plans for forging deals with the world's biggest energy firms in a bid to resurrect Iraq's oil sector, rich with potential but shackled by years of neglect, sanctions and war.
Iraq has the world's third largest oil reserves, but even six years after the US-led invasion, production lingers around pre-invasion levels of around 2.5 million barrels per day.
Criticism of Shahristani's management of Iraq's vast oil wealth came to a head as the minister planned a June 30 energy auction in which he offered the world's biggest energy firms contracts to develop up to eight major oil and gas fields, most of them already in production.
Only one deal came out of that auction -- BP and partner China National Petroleum Corp won the right, after taking a big cut in what it proposed to pay originally, to develop the southern Rumaila field over a 20-year period.
Now, some members of parliament say the contract, due to be signed in August, will be illegal without parliamentary approval, adding to criticism from some in the state-run oil industry who chided Shahristani for putting fields already in production on the auction block.
There are also some unions threatening strikes and sit-ins, charging that the Rumaila deal is illegal because it was passed without new national oil and gas legislation. The law has been held up for years by a bitter feud between Arabs and Kurds.
In the absence of a new law, the ministry is operating under Saddam-era legislation, but no one can agree on what that means.
Government spokesman Ali al-Dabbagh said that the oil ministry considered such contracts "an executive matter."
"The ministry does not see that the constitution requires it to gain parliament's approval for these agreements," he said.
Many lawmakers, especially minority Kurds who assail plans to auction off fields in disputed areas, disagree.
"I believe that parliament will ask the government to bring them a copy of these contracts ... and will ask the government to hold off on signing the contracts until parliament has had its say," said Samarai, a senior figure in the Accordance Front, Iraq's largest Sunni Arab bloc.
Shahristani is planning a second auction near the end of the year, this time hoping to award deals for 11 oil and gas fields that have not yet been developed.
Samarai said Shahristani may be summoned to parliament for another round of questioning about the oil sector following an earlier appearance in June.