On the draft Iraqi Oil and Gas Law

To our great Iraqi people and the masses of the Iraqi working class:

Iraq is rich with a variety of natural resources, in the forefront of which is the enormous oil wealth, that is the real nerve centre of the political and economic life of both Iraq and the world.

Iraq was among the founders of the Organization of Petroleum Exporting Countries (OPEC) in Baghdad in 1960, and issued Law No. 80 of 1961. Under this law, 95.5% of Iraqi territory, that had been under the control of foreign companies according to concession agreements, was expropriated. It lay the proper foundation for protecting the historic gains obtained by the Iraqi people through prolonged battles to regain control of their oil wealth. This law was the solid foundation that ensured success for oil nationalization in 1972.

The covetous designs of major industrial countries therefore continued, in particular American and British oil monopolies that were the first to obtain concession agreements in the Arab region more than 80 years ago. After our country had rid itself of such dominance over the past decades, these multinational corporations and oil monopolies are attempting to regain control of this important oil wealth under various pretexts and flimsy arguments.

Taking into consideration the great importance of oil and gas for the Iraqi economy, and in order to avert the fall of our economy in the trap of oil, it is necessary to adopt a strategy for national development, and to reconfigure the role of the oil sector in this economy through the effective application of coherent policies driven by a socio-economic strategy with clear objectives. This is achieved through linking the present to the future, so as to preserve this national wealth which belongs to all the Iraqi people. It is therefore is right of the Iraqi people to see the draft Oil and Gas Law, and to refuse to allow the fate of this national wealth; the wealth of future generations, to be decided behind closed doors.

The Iraqi public opinion, spearheaded by Iraqi workers, strongly oppose handing over the control of oil and gas to the multinational corporations whose goal is profit. This will have negative economic consequences for our national wealth at the expense of the Iraqi people, and will result in plundering this wealth under unjust long-term contracts.

Having seen the draft law, the Iraqi working class and trade union movement are very concerned about this law as it raises big problems and a host of issues that need to be tackled and reviewed in accordance with the national interest.

The General Federation of Iraqi Workers is putting forward the following points of view as part of its contribution to the debate about this draft law, to make it possible to develop proper Iraqi oil strategy and policies during the coming period, in the light of the nature of the current stage experienced by the oil industry:

First: To avoid hastiness in passing the Oil and Gas Law, so as to give more time for studying and discussing it in a technical and professional manner. The public opinion, civil society organizations, workers and vocational unions, and experts must be allowed to examine the draft law, along with oil cadres specialized in this area, in order to study it and improve it before being forwarded to the Parliament to consider its legislation.

Second: We demand that representatives of the General Federation of Iraqi Workers Iraq and vocational unions attend the discussions of the draft law for the purpose of enriching ideas and opinions relevant to legal items in this law. This is particularly so with regard to the provisions that require contracts to adhere to the Labor Law, the regulations and conditions for employing and developing Iraqi human resources, the proportion of Iraqi participation in these companies, regulating the importation of foreign labor, the responsibilities of investing companies to preserve the rights of individuals and workers, the compensation systems, and the relationship with the courts in the event of various conflicts arising.

Third: We reject, adamantly, the privatization of our oil national wealth and the Production Sharing Agreements (PSAs), and call for direct national investment in oil and gas by the Iraqi National Oil Company. We also call for supporting and developing the Ministry of Oil and its institutions in a comprehensive manner, and to benefit from international expertise and technology on the basis of service and administration agreements with companies that are technically efficient and capable, as needed.

Fourth: To re-establish the Iraqi National Oil Company and to give it preference in the award of contracts. Its tasks must not be confined to producing fields, but should be able to invest in the remaining fields: those discovered but not developed, or those partially developed. It should be granted the new exploration contracts. Law No. 80 of 1961 must not be repealed through handing over the oil fields that are not exploited to foreign companies on the basis of long-term contracts.

Respect for sovereignty and national wealth, including oil wealth, is to respect the laws of the country that serve the interests of its people politically, socially and economically, safeguard its future and the rights of individuals and groups, and preserve the assets of the state and the people.

Long live our great Iraqi people! Long live the Iraqi working class that is fighting for free dignified life!

Executive Bureau

The General Federation of Iraqi Workers

10 July 2007

Translation published in “Tareeq al-Shaab” (People’s Path), the central organ of the Iraqi Communist Party, p.3, Sunday, 15 July, 2007.