Luke Ryland On Antiwar Radio

Scott Horton:

Luke Ryland, of the Wot Is It Good 4 blog, explains the saga of FBI translator turned whistle-blower Sibel Edmonds and the criminality of some of the most powerful Americans that her story exposes.

Click here to listen.

Tom Toles: Moldy Platitudes

Please see Chris Floyd's newest: Supporting the Troops: "Shut Up and Suffer".

Portrait Of A Foreign Policy In Total Chaos

Michael Smith via Larisa says top US brass are prepared to resign if Bush orders an attack against Iran, amid questions as to whether an attack would be merely "reckless" or simply "impossible".

“There are four or five generals and admirals we know of who would resign if Bush ordered an attack on Iran,” a source with close ties to British intelligence said. “There is simply no stomach for it in the Pentagon, and a lot of people question whether such an attack would be effective or even possible.”
...
A generals’ revolt on such a scale would be unprecedented. “American generals usually stay and fight until they get fired,” said a Pentagon source. Robert Gates, the defence secretary, has repeatedly warned against striking Iran and is believed to represent the view of his senior commanders.

Meanwhile, Kathy at Larisa's blog quotes a new book by Andrew Cockburn which says Rumsfeld always wanted to nuke Russia ... well, Russia and China, really ...

Faced with the most awesome choices a simulated environment could present, placed in a situation that was designed and advertised as a rehearsal for what might one day be terrifyingly real, Rumsfeld had one primary response. He always tried to unleash the maximum amount of nuclear firepower possible.

If Cockburn has this right, Dumsfeld was an even more reckless maniac than we ever suspected -- difficult to imagine but quite possibly true! So it's a good thing he's gone ...

... unless he isn't! The Washington Times says Dumsfeld still goes to work at the pentagon every day, where he has a staff of seven, and Mike Whitney argues this means he's still running the works, not Bob Gates, who (as Michael Smith points out) has been among the voices warning the so-called president not to attack Iran.

Meanwhile the so-called vice president has made a "surprise" stop in Pakistan, where he has instructed Pakistani General President Pervez Musharraf to get tough on al-Q'aeda, which sounds pretty good until you read Sy Hersh, who says the USA is once again funding al-Q'aeda-related groups in the Middle East. The veep express was supposed to have stopped in Afghanistan, too, but that was cancelled because of "bad weather". Fog? Flak? What scared them off?

At Empire Burlesque, Chris Floyd has posted an excellent analysis of this particular criminal insanity.

Today, the time lag between a criminal policy and its consequences grows much shorter all the time -- just as the virulence of that response is potentially much greater. For example, the United States engineered an illegal and stupid "regime change" in Iran in 1953, but did not have to face any direct consequences of this folly for more than a quarter of a century, and even these consequences were relatively limited. But there is general agreement that an attempt at "regime change" in Iran now would result in horrific consequences, immediately, including the possible collapse of the oil-based global economy, Shiite uprisings throughout the Middle East (especially against American forces in Iraq), "asymmetric" retaliation at American targets both at home and abroad and other pleasantries. (Similarly, the lag time between supporting the global jihad – which began in 1979 under Democrat Jimmy Carter – and the first fruit of that blowback, the first bombing of the World Trade Center, was just 14 years. How short will be the blowback from this latest arming and funding of al Qaeda and other Sunni extremists? A few years? A few months? Or right now – as many of these groups are allied with the Iraqi insurgents?)

And so, beyond the inherent immorality of supporting al Qaeda (yet again); beyond the inherent immorality of fomenting terrorist strikes inside Iran (and elsewhere); beyond the inherent – and downright Hitlerian – immorality of invading Iraq and possibly invading Iran, we have the simple fact that in today's world, the United States simply cannot "get away" with such extravagant stupidities anymore, for any length of time whatsoever. The rot is too deep, the compound interest is too high and the consequences too dire and immediate.

It may be very true that the United States cannot "get away" with such extravagant stupidities anymore. But unless I am reading this way wrong, our so-called leaders have no intention of stopping now, let alone turning back.

Prepare to radiate!

Meet Jerome Hauer, 9/11 Suspect Awaiting Indictment

Jerome Hauer

Ladies and Gentlemen, meet Jerome Hauer, director of the Office of Public Health Preparedness.

On September 11, 2001, Jerome Hauer was a national security advisor with the National Institute of Health, a managing director with Kroll Associates, and a guest on national television.

His background in counter-terror and his specialized knowledge of biological warfare served him well on that day.

Perhaps a little too well.

Anthrax Attacks

On September 11, 2001, Jerome Hauer advised the White House to begin taking Cipro, an antibiotic which is effective against anthrax.

Mr. Hauer's advice was not made public. Its value may have been underestimated at the time, but it was clearly demonstrated a week later, when the first anthrax letters appeared, and again three weeks after that, when anthrax appeared in letters to Democratic Senators Daschle and Leahy.

The obvious question is: Did Jerome Hauer know about the anthrax attacks in advance?

Prior Knowledge?

Strangely, perhaps, this is not the first time questions of prior knowledge have surfaced in Jerome Hauer's wake.

Jerome Hauer joined New York City's Office of Emergency Management (OEM) in 1998 and quickly obtained funding from the office of then-mayor Rudy Giuliani for the study of West Nile virus. The following year the virus appeared in the city, and Jerome Hauer led the fumigation effort.

Did Jerome Hauer know this was going to happen? Or did he just get "lucky"?

And how could anyone know such a thing was going to happen? Unless ... unless ...

The Sound Of Two Feet Dragging

Strangely, perhaps, Jerome Hauer managed the NIH response to the anthrax attacks. The anthrax used in the attacks was identified as an Ames strain, which means it had to have come from the U.S. Army Medical Research Institute of Infectious Diseases (USAMRIID) at Fort Detrick, Maryland.

Jerome Hauer received relatively good information for tracking down the origin of the anthrax. He even got a list of people from various institutes, including USAMRIID at Fort Detrick. But his response was slow and hidden behind a public relations campaign spreading Orwellian claims like "Suspects are Osama bin Laden and his Al-Q'aeda network and sympathizers to US right wing extremists".

Why would he act so slowly, and in such an inappropriate fashion? Perhaps because Jerome Hauer knew someone whose name was on that list?

Stephen Hatfill, at one time considered a prime suspect in this still-unsolved case, had worked for USAMRIID at Fort Detrick. Strangely, perhaps, he had also worked with Jerome Hauer, for Scientific Applications International Corporation, at the Center for Counterterrorism Technology and Analysis.

The World Trade Center

Jerome Hauer's connections with terror and counter-terror started with and concentrated on biological warfare, but they don't stop there.

On September 11, 2001, in addition to his job with the NIH, Jerome Hauer was also Managing Director of Kroll Associates, a well-established security firm serving clients in the military and the US government. In the 1980s, Kroll was known as the "CIA of Wall Street" because of the sorts of the people it hired, and the sorts of tasks they were assigned.

Strangely, perhaps, on 9/11, Kroll was in charge of security for the entire World Trade Center complex.

The head of security at the WTC on September 11, 2001, was former FBI counter-terror specialist John P. O'Neill.

O'Neill, considered the world's leading expert on Osama bin Laden, had resigned his post as Deputy Director of the FBI during the summer, very unhappy with the Bush administration's head-in-sand "approach" to terror, after investigations into Osama bin Laden and al-Q'aeda had been blocked.

Who Killed John O'Neill?

John O'Neill started his new job at the WTC shortly before he was killed there. His having landed that particular job at that particular time raises some very interesting questions.

Among them: Why does this matter?

If, as many people believe, 9/11 was a false-flag operation designed to implicate Osama bin Laden, then a legend, or a cover story, involving bin Laden would have to be fabricated, disseminated very quickly, and swallowed whole -- not just by the American people but by the people of the world.

And John O'Neill was a most -- if not the most -- formidable obstacle in the way of such a cover story.

He was not only the world's leading expert on bin Laden, but he was also regarded as a "loose cannon", because of his record of working outside normal channels when normal channels were "blocked". He knew FBI investigations into bin Laden and al-Q'aeda had been shut down in the summer of 2001 and it is extremely unlikely that he would have remained quiet about it. He also knew whether or not Osama bin Laden was capable of inflicting the amount of damage the US suffered on 9/11.

In other words, if the conspirators were hoping to spread a Big Lie about Osama bin Laden, they would have had a short list of things they absolutely had to do.

Surely, one of the items on that list would be to silence John O'Neill.

And what better way than to entomb him at the scene of the crime?

So many questions!

Who got John O'Neill the WTC job?

Strangely, perhaps, John O'Neill was lured to the WTC position by his old friend Jerome Hauer, Managing Director of Kroll.

Very strange indeed, don't you think?

National Television

Which employer -- if any -- was Jerome Hauer representing on the morning of September 11, 2001, when he slipped the seeds of the official conspiracy theory to Dan Rather and his viewers on CBS?

A few weeks ago I blogged about a video which was hosted at Google at the time but which has now been taken down. Fortunately I was able to obtain transcripts from the video while it was available.

[UPDATE: The video is now available again, at YouTube, and it will be embedded below if possible.]

One segment of the video [starting at 2:30] documents the following exchange, from the morning of September 11, 2001:

Dan Rather: Based on what you know, and I recognize we’re dealing with so few facts, is it possible that just a plane crash could have collapsed these buildings, or would it have required the, sort of, prior positioning of other explosives in the, uh, in the buildings? I mean, what do you think?

Jerome Hauer: No, I, uh, my sense is just the velocity of the plane and the fact that you have a plane filled with fuel hitting that building, uh, that burned, uh, the velocity of that plane, uh, certainly, uh, uh, had an impact on the structure itself, and then the fact that it burned and you had that intense heat, uh, probably weakened the structure as well, uh, and I think it, uh, was, uh, simply the, uh, the planes hitting the buildings, and, and causing the collapse.

Jerome Hauer is certainly a remarkable guest, isn't he? On the very morning of the event, he had the whole thing figured out.

The collapse was simply due to the planes hitting the buildings, just the velocity of the plane and of course the fact that it was filled with fuel, and the fact that it burned and of course you had that intense heat which must have weakened the structure ... It's incredible, of course. It's also half of the official story!

But let's get back to the attack itself. Who did it? Who could have done it? If you were watching CBS that morning, you would have heard this:

Dan Rather: What perspective can you give us? I mean, there have been these repeated reports that, well, yes, Osama Bin Laden, but some think he’s been over-emphasized as, as responsible for these kinds of events. I know many intelligence, uh, people at very high levels who say, listen, you can’t have these kinds of attacks without having some state, Iraq, Iran, Libya, Syria, somebody involved. Put that into perspective for us.

Jerome Hauer: Yeah, well I’m not sure I agree that, umm, this is necessarily state-sponsored. Umm, it, as I mentioned earlier, certainly has, umm, the, uh, fingerprints of somebody like Bin Laden.

And that, of course, is the other half of the official story.

How did Dan Rather happen to have a guest with him on the morning of 9/11 who knew the entire official story before it became public knowledge?

Jerome Hauer was introduced to CBS's viewers as a former director of NYC's OEM. Strangely, perhaps, CBS News audiences were not told he was also a managing director of the security company responsible for the twin towers. And of course no one was told to start taking Cipro -- except the White House.

Planting The Seeds

The twin disintegrations of the twin towers certainly looked like explosives-driven demolitions to many reporters who covered them live -- but Jerome Hauer assured Dan Rather and his viewers that it was just caused by the intense heat that weakened the structure!

The attack of 9/11 was of such scope and ferocity that it was virtually unimaginable -- except to the people who planned it -- just a day before it happened. But when it did happen, Jerome Hauer was able to contradict the intelligence experts and claim it bore the fingerprints of somebody like Bin Laden!

Jerome Hauer knew the entire official story before it became public knowledge.

Jerome Hauer helped the official story become public knowledge!

Watering The Seeds

In November of 2001, Jerome Hauer participated in the Council on Foreign Relations' "Independent Task Force on America's Response to Terrorism", along with Henry A. Kissinger and others; their task included the following items:

Release a White Paper explaining our goals and rationale for the war in Afghanistan, and outlining the evidence that the al-Qa'eda network was responsible for the 9/11 attacks

Disseminate stories of particular victims to convey the range of people killed in the 9/11 attacks -- stress range of religions, races, income levels, etc.

Counteract [the] myth that Mossad was behind the attacks by showing Jews killed, etc.

Routinely monitor the regional press in real time to enable prompt responses

Routinely Monitor This!!

You have a plane filled with fuel hitting that building, the velocity of that plane certainly had an impact on the structure itself, and then the fact that it burned and you had that intense heat, probably weakened the structure as well, and I think it was simply the planes hitting the buildings and causing the collapse.
...
I’m not sure I agree that this is necessarily state-sponsored. It certainly has the fingerprints of somebody like Bin Laden.

Yeah, sure it does! Really, Jerome -- we believe you!

No, we don't!

Book 'em, Danno!

~~~

[SEE ALSO]

CRUCIAL VIDEO: Who Killed John O'Neill?

9/11 Encyclopedia: Hauer, Jerome
9/11 Encyclopedia: Kroll Associates
Demopedia: Jerome Hauer
Demopedia: Who Killed John O'Neill
Here In Reality: Who Killed 9-11 Hero John O'Neill?
Whistleblower Andrew Grove blames Kroll for 9/11
Wikipedia: Jerome Hauer
Wikipedia: John P. O'Neill
Wikipedia: Kroll Associates


[thanks to 99 for research assistance]

Tom Toles: Rehab

Here's a soft question for a Monday ... Did you manage to avoid catch the Ocsars (TM)?

Surprise! Most Of The 'Intelligence' USA Gave IAEA On Iran Was Wrong!

From South Africa, News24 reports:

Washington - Most US intelligence on Iran shared with the International Atomic Energy Agency has proved to be inaccurate and failed to lead to discoveries of a smoking gun inside the Islamic Republic, The Los Angeles Times reported on its website on Saturday.

Citing unnamed diplomats working in Vienna, the newspaper said the CIA and other Western intelligence services have been providing sensitive information to the IAEA since 2002.

But none of the tips about Iran's suspected secret weapons sites provided clear evidence that the Islamic Republic is developing a nuclear arms arsenal, the report said.

"Since 2002, pretty much all the intelligence that's come to us has proved to be wrong," the paper quotes a senior IAEA diplomat as saying.

Another official described the agency's intelligence stream as "very cold now" because "so little panned out," The Times reported.

US officials privately acknowledge that much of their evidence on Iran's nuclear programs remains ambiguous, fragmented and difficult to prove, the report said.

If it's ambiguous and difficult to prove then it's not exactly evidence, is it?

News24 has more.

Tom Toles: Anyone Can Be A Monday Morning Quarterback

How long has it been since we had an Open Thread?

Oh! Really?

Well, I hope you don't mind another one so soon!

Israel Seeks US Permission To Fly Over Iraq On The Way To Iran

The Telegraph says: Israel seeks all clear for Iran air strike

Israel is negotiating with the United States for permission to fly over Iraq as part of a plan to attack Iran's nuclear facilities, The Daily Telegraph can reveal.

To conduct surgical air strikes against Iran's nuclear programme, Israeli war planes would need to fly across Iraq. But to do so the Israeli military authorities in Tel Aviv need permission from the Pentagon.

Israeli intelligence is showing itself to be as creative in this manufactured crisis as the Americans were four years ago. Look at this:

The pace of military planning in Israel has accelerated markedly since the start of this year after Mossad, the Israeli intelligence service, provided a stark intelligence assessment that Iran, given the current rate of progress being made on its uranium enrichment programme, could have enough fissile material for a nuclear warhead by 2009.

The CIA said not long ago that the Iranians were ten years away from being able to make nuclear weapons. But this is not sufficient pretext for the launching of nuclear war, especially since I personally am about that far away from being able to make nuclear weapons, so now the intelligence has to be continually revised and restated and reinterpreted and sometimes simply created until there's enough information -- bogus or double-bogus, it really doesn't matter anymore -- to justify the continuing planning to kill thousands or maybe even millions of innocent people.

A senior Israeli defence official said negotiations were now underway between the two countries for the US-led coalition in Iraq to provide an "air corridor" in the event of the Israeli government deciding on unilateral military action to prevent Teheran developing nuclear weapons.

"We are planning for every eventuality, and sorting out issues such as these are crucially important," said the official, who asked not to be named.

"The only way to do this is to fly through US-controlled air space. If we don't sort these issues out now we could have a situation where American and Israeli war planes start shooting at each other."

Well we wouldn't want that, would we?

Former Federal Prosecutor Publishes Indictment Of Bush And Other Administration Officials

Former federal prosecutor Elizabeth Vega has written a book containing a draft indictment of the so-called president and other top administration officials for conspiracy to defraud the American people on the issue of whether or not we needed to invade Iraq. The book also includes a fictional grand jury proceeding based on that indictment.

More details from Matthew Cardinale of Atlanta Progressive News:

De la Vega argues the American people are too narrowly concerned about whether Bush Administration officials lied or not, when in fact, lying is just one type of fraud.

"A scheme to defraud is any plan or course of action that’s intended to deceive another through false pretenses, representations, or promises," she writes on page 54.
...
The word conspiracy does not legally mean people in trench coats were whispering in a dark alley. It simply means a concerted effort; and the White House stated publicly in the weeks prior to the 2002 Congressional Authorization to go to war, that they were openly engaged in a concerted public relations strategy.

At only 241 small pages, this book sounds like a great gift idea! Please read the whole article.

U.N. Report Compares Israel's Actions To Apartheid

From the AP's Bradley S. Klapper via the Houston Chronicle:

An independent report commissioned by the United Nations compares Israel's actions in the West Bank and Gaza Strip to apartheid in South Africa — charges that have drawn angry rebukes from Israel.
...
In the report, [John] Dugard, a South African lawyer who campaigned against his country's system of state-sanctioned racial segregation in the 1980s, says "Israel's laws and practices in the (Palestinian territories) certainly resemble aspects of apartheid."

Jimmy Carter said the same thing recently, to howls of derisive laughter -- or something derisive, anyway...

The report catalogues a number of accusations against the Jewish state ranging from restrictions on Palestinian movement, house demolitions and preferential treatment given to Jewish settlers in the West Bank.

"Can it seriously be denied that the purpose of such action is to establish and maintain domination by one racial group — Jews — over another racial group — Palestinians — and systematically oppress them?" he wrote in the report.

All depends on what you mean by "serious", I suppose:

Israel maintains that its actions are aimed at preventing Palestinian suicide bombings and other attacks that have killed more than 1,000 Israelis in the past six years. Officials say the violence broke out in 2000 after Israel's proposal to pull out of the vast majority of the West Bank and Gaza in exchange for peace was rejected.

Strangely enough, non-Israelis remember the beginning of the current round of violence much differently.

Israel's ambassador in Geneva criticized Dugard for directing attacks only at the Jewish state.

"Any conclusions he may draw are therefore fundamentally flawed and purposely biased," said Yitzhak Levanon.

But in fact the report criticizes both sides, so once again Israel's ambassador is lying through his teeth.

Dugard's report says war crimes have been committed by both sides, though it reserves its harshest criticism for Israel.

"This applies to Palestinians who fire Qassam rockets into Israel; and more so to members of the IDF (Israeli Defense Force) who have committed such crimes on a much greater scale," he wrote.

Can't somebody at AIPAC get the Americans to veto this report before it comes out? There's still time, isn't there?

The report by John Dugard, independent investigator on the Israeli-Palestinian conflict for the U.N. Human Rights Council, is to be presented next month.

Well, then ...

Burn it!

It has already been posted on the body's Web site.

Ummmm.... Oops!!

Brooklyn: Ex-Party Leader Found Guilty Of Corruption -- Again!

Anemona Hartocollis in the New York Times:
Ex-Party Boss in Brooklyn Guilty of Corruption

Clarence Norman Jr., the deposed Democratic assemblyman and party leader from Brooklyn, was convicted today on charges that he shook down judicial candidates seeking party support...

It was his fourth trial for corruption in two years, and his third conviction!

In the latest case, Mr. Norman was found guilty of attempted grand larceny in the fourth degree by extortion; grand larceny in the third degree by extortion and coercion in the second degree. He was accused of forcing two white candidates for civil court judge to pay thousands of dollars to favored campaign vendors to retain his organization’s support in the 2002 primary.

Right! Sell the endorsement. Because who cares about the issues anyway? We've got cynical parasites on both sides of the aisle.

The jury handed up its verdict after less than three days of deliberations. It appeared to have adopted the prosecution’s view that Mr. Norman, once the leader of one of the largest Democratic Party organizations in the country, had sold out his public trust for the sake of financial greed and political power.
...
“Clarence Norman is no hero,” Michael Vecchione, the assistant district attorney, told the jury before they began deliberating on Wednesday. “Clarence Norman is no champion of civil rights. Clarence Norman is a thief.”

Looks like a good call to me.

How can I tell? Look at this:

The defense argued that Mr. Norman was a skilled political strategist, doing what was necessary for Democratic candidates to win.

Did you catch that? The defense didn't even try to pretend he didn't do anything wrong. Instead the defense argued that Democratic candidates cannot win without extortion! and that therefore extortion by Democratic bosses is acceptable!

I'm glad the jury didn't endorse this particular brand of mental illness! And this makes three out of four.

In his three previous political corruption trials, Mr. Norman was convicted in two of them and acquitted in one. He faces a total of two to six years in prison for the earlier convictions.

Two to six years in prison is a pittance compared to the heinous crime of betraying democracy for personal gain. I hope all thinking Americans will join me in condemning all corrupt politicians, regardless of their party affiliation.

They really don't deserve to be IMPEACHed!

Judge Orders Tests To Determine Whether Alleged Terrorist Wannabe Derrick Shareef Is Competent To Stand Trial

Derrick Shareef will undergo testing to determine whether he is mentally fit to stand trial, according to an order issued by U.S. District Judge David H. Coar in Chicago today.

The AP's Mike Robinson has the details:

A federal judge on Friday ordered a psychological examination for an alleged terrorist wannabe who offered to trade his stereo speakers for grenades to set off in a Rockford mall at Christmas time.

Derrick Shareef, 22, of Rockford, is to be examined by a qualified psychiatrist or psychologist designated by the government under the order issued by U.S. District Judge David H. Coar.

It's interesting to see Mike Robinson calling Shareef an "alleged terrorist wannabe", rather than the more standard "alleged terrorist" or even "Muslim terrorist"; perhaps Robinson's starting to get a whiff of the fragrance which has led me to call Shareef an "entrapment victim", rather than "alleged terrorist", since the day he was arrested.

Prosecutors say the 22-year-old Muslim convert plotted with an FBI undercover informant to commit acts of "violent jihad," or holy war, including blowing off hand grenades in garbage cans at the Rockford mall.

The idea was to blow the cans apart and spray the 130-store CherryVale Mall with deadly shrapnel at the height of the Christmas shopping rush, authorities said.

Yes, and a ludicrous plan it was, to be sure. A careful reading of the affidavit filed in this case reveals that nearly every aspect of the "plot" -- the date, the place, the weapons -- was suggested by the "confidential FBI informant". The only detail Shareef apparently came up with on his own was the utter brainstorm about detonating the grenades in garbage cans.

According to the affidavit, Shareef thought the garbage cans -- and the garbage in them -- would turn into deadly shrapnel. But grenades are designed to fragment; they make their own shrapnel. Detonating a grenade inside a garbage can would only serve to contain the shrapnel, and limit the damage. But the "confidential FBI informant" didn't need to worry about the details; all he needed to worry about was leading his horse to water and getting him to take a little sip.

Federal officials said that Shareef had been under investigation long before his Dec. 6 arrest after he offered to trade the speakers for a pistol and four hand grenades. They said there had never been any danger.

Well of course there was never any danger; there were never any live weapons involved either. And if not for the "confidential FBI informant" the alleged plotter Derrick Shareef would never have even visited the alleged scene of the allegedly planned alleged crime: CherryVale Mall.

Nor would he have cased any other potential "targets". For the purpose of selecting targets, Shareef rode around with the "confidential FBI informant", because Shareef didn't have a car. Nor a clue. He didn't have any weapons, he didn't have an independent source of weapons; he didn't even have any cash, and he couldn't get any, either. That's why the "confidential FBI informant" offered to introduce him to an "arms dealer" who would take a pair of speakers as payment.

This was the detail that tipped me off in the beginning. What sort of "arms dealer" accepts used home audio equipment in place of cash? Unknown to Derrick Shareef, but not surprising to me, both the "confidential informant" and the "arms dealer" turned out to be working for the FBI.

Coar issued his order after defense attorney Michael B. Mann said there was a question of whether Shareef was competent to stand trial.

I've been wondering about that myself. Clearly he wasn't competent to resist the enticements of a slick scammer, but whether or not he is declared competent to stand trial, the government has already got all it wants from this case. And that may be one reason why

Assistant U.S. Attorney Jake Ryan did not object to the examination.

The publicity generated by Derrick Shareef's arrest gave a big boost to the phony war on phony terror, and it may actually be in the government's interest to have Shareef found unfit for trial; then there would be no trial and no possibility that the slick entrapment scheme which caught Derrick Shareef could be exposed.

Coar said the competency examination should be performed within 30 days and set April 6 for a hearing on the results.

All right, then. April 6 it is. I'll mark my calendar. And I'll try to keep you posted.

Justice Coar also set a date of March 6 for a hearing following Shareef's complaint about the conditions under which he is being held. Mike Robinson has more details here.

~~

seventh in a series

Cheney In Australia: Four Arrested In Violent Protests

Police and anti-war protesters clashed violently in Sydney during a massive security operation to protect the Vice-President [...] Four people were arrested during the two-hour protest outside Sydney's Shangri-La Hotel, where Mr Cheney was giving his speech.

This from Australia's The Age, which ran the above photo with the caption: "Love him or hate him, members of the public make their feelings about US Vice-President Dick Cheney known in Sydney yesterday. [Photo: Lee Besford]"

I'm still laughing at the picture.

Meanwhile, inside the hotel, Cheney spun out his ever-more-elaborate New Domino Theory for an audience strangely devoid of high-level Australians:

Mr Cheney said a withdrawal of troops before the Iraqis could properly defend themselves would allow violence to spread across the globe.

Many jihadists would head for Afghanistan and others would undermine moderate governments across the Middle East, while other terrorist groups sought victims on other continents, he said.

"We have a duty to stand in their way," Mr Cheney told a meeting of the Australian-American Leadership Dialogue, notable for the absence of most senior members of the Howard Government.

Mr Cheney [...] said terrorists wanted to seize a country in the Middle East and use it as a base for attacks on governments that refused to meet their demands.

Their ultimate aim was to create a caliphate ranging from Spain, across North Africa, the Middle East and South Asia to Indonesia. "It would not stop there," he said...

Of course not. It wouldn't stop at all. Not as long as Cheney's making millions of dollars every year from it. What does he care?

In diplomatic terms, his reception was strange indeed.

America was glad to be fighting alongside a country like Australia, which never abandoned its mates, he said.

But the Prime Minister, and other senior members of the Government, including Foreign Minister Alexander Downer, were not present to hear the praise, given during the only public engagement of Mr Cheney's three-day Australian visit.

Mr Howard, who did not meet Mr Cheney's plane when it arrived on Thursday night, put a higher priority on yesterday's water summit with state premiers. He will meet Mr Cheney today.

So instead of being greeted by his "mate" the Prime Minister, Cheney was welcomed by the leader of Australia's opposition Labor Party, Kevin Rudd.

And as The Age notes, there are very clear differences in opinion between the two:

It was clear yesterday that Mr Rudd and Mr Cheney differed in their views of the war in Iraq, with the Labor leader depicting the conflict as a religious civil war requiring a political solution rather than a fight against terrorism.

The Age also mentions:

During a visit by President George Bush in 2003, Government ministers lined up to shake the hand of the US President.

What a difference four years makes!

Perhaps Dick Cheney would have felt more comfortable with the state premiers at the water summit.

And why not? It was good enough for John Howard!

Devious, Dangerous And Far From Stupid: Connecting The Dots From Afghanistan to Iraq

Here's a good find, caught recently by a good friend: a very well-written piece by Richard W. Behan at Alternet called From Afghanistan to Iraq: Connecting the Dots with Oil

I've been thinking "from Lebanon to China", but that's a small point.

In the Caspian Basin and beneath the deserts of Iraq, as many as 783 billion barrels of oil are waiting to be pumped. Anyone controlling that much oil stands a good chance of breaking OPEC's stranglehold overnight, and any nation seeking to dominate the world would have to go after it.

The long-held suspicions about George Bush's wars are well-placed. The wars in Afghanistan and Iraq were not prompted by the terrorist attacks in New York and Washington. They were not waged to spread democracy in the Middle East or enhance security at home. They were conceived and planned in secret long before September 11, 2001 and they were undertaken to control petroleum resources.

The "global war on terror" began as a fraud and a smokescreen and remains so today, a product of the Bush Administration's deliberate and successful distortion of public perception. The fragmented accounts in the mainstream media reflect this warping of reality, but another more accurate version of recent history is available in contemporary books and the vast information pool of the Internet. When told start to finish, the story becomes clear, the dots easier to connect.

Both appalling and masterful, the lies that led us into war and keep us there today show the people of the Bush Administration to be devious, dangerous and far from stupid.

The following is an in-depth look at the oil wars, the events leading up to them, and the players who made them possible.

There's a lot more. Read it all if you dare.

Gwynne Dyer: If Bush Gives The Order, Pace Faces A Big Decision

Many people listen to the White House these days and conclude a United States attack on Iran is imminent: "To be quite honest, I'm a little concerned that it's Iraq again," as Senator John Rockefeller, the new chairman of the Senate Intelligence Committee, said recently.

But if President Bush gives the order, then General Peter Pace, chairman of the Joint Chiefs of Staff, will face a big decision.

Some senior US soldiers were worried about the strategic wisdom and even the legality of invading Iraq, but nobody resigned over it. It was obvious the US would win the war quickly and cheaply, and almost nobody worried about the aftermath.

But an attack on Iran is different, even though it would not involve American ground troops, because any competent general knows this is a war the US cannot win.

Who says there's a war the US cannot win?

Why, Gwynne Dyer, of course. He's a veteran of two navies and a respected military historian; he knows the difference between slogans and realities. Dyer's most recent column comes to us today from New Zealand.

Air strikes alone cannot win a war, however massive they are, and they probably could not even destroy all of Iran's nuclear facilities, which are numerous, dispersed, and often deeply buried.

Many Iranians would be killed, but what would the US do next? It would have very few options, whereas Iran would have many. Iran could flood Iraq with sophisticated weapons and volunteers to fight against US forces.

It could throw international markets into turmoil by halting its oil exports. It could try to close the entire Gulf to tanker traffic, and throw the world economy into crisis.

And any further US air strikes would simply harden Iranians' resolve.

So ... what to do about it?

How about NOT doing it?

So would General Pace attack Iran if Bush ordered him to? His only alternative would be to resign, but he does have that option.

Senior officers like Pace, while still bound by the code of military discipline, also acquire a political responsibility. Like cabinet ministers, they cannot oppose a government decision while in office, but they have the right and even the duty to resign rather than carry out a decision they believe disastrous.

The resignation of the chairman of the Joint Chiefs of Staff - and possibly several of the other chiefs as well - would be an immensely powerful gesture. It could stop an attack on Iran dead in its tracks, for the White House would have to find other officers who would carry out its orders.

It would doubtless find them, but such a shocking event might finally enable Congress to find its backbone and refuse support for another illegal and foredoomed war.

But what would it say to the Terrorists?

My guess is both the Joint Chiefs and the White House understand that the option of resignation is on the table. Consider the dance that was done around the question of Iran and "Explosively Formed Penetrators" in the past couple of weeks. (EFPs are glorified shaped-charge weapons that can penetrate armour. Most major armies have had them for several decades.)

On 11 February, US officials claimed the EFPs that have killed some 170 American troops in Iraq since 2004 were Iranian-made, and supplied to Iraqi insurgents by "the highest levels of the Iranian government".

White House spokesman Tony Snow insisted they were being supplied by the Quds unit of the Iranian Revolutionary Guard.

Familiar stuff from the run-up to the Iraq war - but then something unscripted happened. In Australia, General Peter Pace said Iranian Government involvement was not proven: "We know that the explosively formed projectiles are manufactured in Iran, but I would not say by what I know that the Iranian Government clearly knows or is complicit." A day later, in Jakarta, he repeated his doubts: "What [the evidence] does say is that things made in Iran are being used in Iraq to kill coalition soldiers."

Methinks the General ought to know enough not to undercut his Commander in Chef while he's trying to catapult the propaganda!

There is a civil-military confrontation brewing in the US not seen since President Truman fired General Douglas MacArthur during the Korean War.

But this time, if the general acts on his convictions, he will be in the right.

There are some people around here looking for a much more serious civil-military confrontation than the president firing a General. And pulling for the military, too, unless I am very much mistaken.

The "thinking" goes: If we can't have gridlock in Congress then maybe we can get some mutiny in the Pentagon. Yesterday I wasn't sure whether that would qualify as thinking or merely wishin' and hopin' and prayin' ... but today, having read Dyer's most recent, I could almost be persuaded that there's hope for us yet.

Slim is always better than None.

Australia Prepares Welcome For Dick Cheney, War Criminal

From the New Zealand Herald:
Clashes in Sydney before Cheney's Australia trip

SYDNEY - Anti-Iraq war protesters clashed with police in Sydney yesterday ahead of a visit by US Vice President Dick Cheney, underlining divisions within one of Washington's firmest allies over the unpopular war.

Police detained about six people when up to 200 Stop the War Coalition protesters, demanding Australian Prime Minister John Howard pull troops out of Iraq, tried to march from Sydney Town Hall to the US consulate.

A heavy police presence, including officers mounted on horseback, ringed the protesters in an attempt to minimise disruption to peak-hour commuters, some of whom also squabbled with police.

Protesters held placards saying "Dick Go Home & Take John With You" and "Stop Cheney, Troops Out". Police later relented and shepherded protesters as they marched towards the consulate.

There's more where that came from, and more here too.

Tom Toles: Little Georgie's Excellent Iraq Adventure

All sorts of things are going on; unfortunately I can't blog about them yet. But I'll let you know about them as soon as possible.

Tom Toles understands things that normal people don't even notice.

Proposed Iraqi Oil Law In HTML

The proposed Oil Law for Iraq has been leaked to the blogosphere and translated into English. As far as I know, the text is available as a PDF file in a few places but not otherwise. PDF format is fine for some purposes but it is very difficult to quote without extensive typing. For those who seek an HTML version of the proposed law, I have posted the text as a blog page here.

The Proposed Iraqi Oil Law

The new Oil Law proposed for Iraq has been leaked to the blogosphere. The text presented below is from a draft dated January 15, 2007, and translated by Raed and Niki of Raed in the Middle. Essential further details, including analysis and PDF files, are available from Raed here.

This page is intended for those who seek the text of the proposed Iraqi Oil Law in HTML. Many thanks to Raed Jarrar for translating this document and making it available to us. I have done a very slight bit of editing for clarity.

~~~~~

Contents

Preamble
CHAPTER I: Fundamental Provisions
ARTICLE 1: Ownership of Petroleum Resources
ARTICLE 2: Scope of Application
ARTICLE 3: Purpose
ARTICLE 4: Definitions

CHAPTER II: Management of Petroleum Resources
ARTICLE 5: Competence Of Authorities
ARTICLE 6: Creating the National Iraqi Oil Company
ARTICLE 7: Re-Arranging the ministry of oil
ARTICLE 8: Oil Fields’ development and production
ARTICLE 9: Grant of Rights
ARTICLE 10: Mechanisms of negotiations and contracting
ARTICLE 11: Oil revenue
ARTICLE 12: Participation of the State

CHAPTER III: UPSTREAM OPERATIONS
ARTICLE 13: Exploration and Production Contract
ARTICLE 14: obligations of the Holders of Exploration and Production right
ARTICLE 15: building local expertise
ARTICLE 16: Unitisation
ARTICLE 17: Conservation
ARTICLE 18: Access to Main Pipelines and Field Pipelines
ARTICLE 19: Ownership of Data
ARTICLE 20: Restrictions on Production Levels

CHAPTER IV: Transportation
ARTICLE 21: Main Pipelines
ARTICLE 22: Rights and Obligations regarding Pipelines

CHAPTER V: Natural Gas
ARTICLE 23: investment of Gas
ARTICLE 24: Associated Gas
ARTICLE 25: Flaring of Natural Gas
ARTICLE 26: Non-Associated Gas

CHAPTER VI: Regulatory Matters
ARTICLE 27: Regulations for Petroleum Operations
ARTICLE 28: Use and Benefit of Land and Rights of Way
ARTICLE 29: Access to Zones Subject to Maritime Jurisdiction
ARTICLE 30: Inspection
ARTICLE 31: Environmental Protection and Safety
ARTICLE 32: Transfer of Ownership and Decommissioning

CHAPTER VII: Fiscal Regime
ARTICLE 33: General Principles of Taxation
ARTICLE 34: Royalty
ARTICLE 35: Other Taxation Issues

CHAPTER VIII: Miscellaneous Provisions
ARTICLE 36: Transparency
ARTICLE 37: implementing anti-corruption laws
ARTICLE 38: attracting competitive participation
ARTICLE 39: Existing Contracts
ARTICLE 40: Resolution of Disputes
ARTICLE 41: Relationship to Existing Legislation
ARTICLE 42: Entry in Force

PREAMBLE

WHEREAS the Iraqi Republic has entered a new era after the adoption of the Constitution In 2005;

WHEREAS, ARTICLE 111 of the said Constitution declares Oil and Gas as the property of the whole nation in all Its Provinces and Governorates;

WHEREAS, ARTICLEs 110, 112, 114 and 115 seen in the light of ARTICLE 111 broadly define the authorities and responsibilities of the Federal and Provincial authorities within the Petroleum sector;

WHEREAS, the Iraqi Republic is endowed with rich Oil and Gas resources, a great portion of which is already discovered and ready for Development whilst more Petroleum resources are yet to be discovered;

WHEREAS, Iraq's Production capacity during the last decades has been low and at great disparity with its exceptionally rich Oil and Gas resources;

WHEREAS, the Iraqi nation finds Itself at the crossroad to a new and more prosperous future which will require quick and substantial funding of reconstruction and modernization projects;

WHEREAS, revenues from oil and Gas represent the most important basis for redeveloping the country in general and the Iraqi economy In particular on sustainable and robust basis in a planned and coordinated manner that takes into consideration the objectives of the Constitution Including the unity of the Iraqi Republic, the exhaustible nature of Petroleum resources, the need for preserving the environment; To help the Iraqi Ministry Of Oil focus on its main duties of creating policies, planning, and supervision, while achieving the necessary upgrading to enhance operational quality, the oil activates operated solely by the Ministry of Oil have to be transferred to technical and commercial entities and institutions including an independent national Iraqi oil company, and the Iraqi provinces and regions should be given more authorities.

WHEREAS the rehabilitation and further development of the petroleum Industry will be enhanced by the participation of international and national investors of recognized technical, managerial and operational skills as welt as robust capital resources to help upgrade and develop national expertise and efficiency in the petroleum sector;

WHEREAS, the national private Industry directly and indirectly related to the Petroleum sector are in need of proactive encouragement and support to play a prominent role in the development of the sector;

WHEREAS, the positive interplay between the Federal and Provincial authorities requires appropriate legislative and institutional framework conditions to ensure efficient co-ordination;

WHEREAS, the introduction of a variety of national and international players in the development of the Petroleum sector calls for clear legislative, institutional and operational framework conditions to ensure co-ordination and efficiency between the Iraqi authorities and the commercial players as well as among these players;

WHEREAS, the development of the petroleum sector must be closely coordinated and harmonized with the development of the society and the national economy in a manner that maintains sustainable development for the economy and the environment and in the long term decreases dependence on Oil and Gas revenues;

WHEREAS, the terms and conditions regulating the Petroleum sector are of great importance to the whole nation as well as to all Investors in the sector, there is a need for a clear, fair, transparent and efficient system of governance that inspires confidence, efficiency and co-operation among all participants in the petroleum sector be that on the authorities side (Federal, Provincial or Governate level) or among the national and International actors;

THEREFORE .......

CHAPTER I: FUNDAMENTAL PROVISIONS

ARTICLE 1: OWNERSHIP OF PETROLEUM RESOURCES

Ownership of oil and natural gas is vested in the entire Iraqi Federal Oil and Gas Council in all provinces and regions.

ARTICLE 2 : SCOPE OF APPLICATION

A - This law applies to Petroleum Operations in all the territory of the Republic of Iraq, including the soil and subsoil on land, as well as inland waters and territorial waters.

B - The scope of this Law excludes the refining of Petroleum, its industrial utilization as well as the distribution and the marketing of Petroleum Products.

ARTICLE 3 : PURPOSE

A - This law establishes the regime for the management of Petroleum Operations in the Republic of Iraq, taking Into account the existing International agreements between the Republic of Iraq and other countries on crude oil transportation.

B - The law aims to build upon existing co-operation between the relevant Ministries in the Federal Government administration, in addition to building a base for coordination and discussions among the federal, regional, and provincial oil producing authorities.

ARTICLE 4 : DEFINITIONS

For the purposes of this law, the following terms and expressions shall have the meaning indicated as follows, unless the context in which used requires a different meaning:

1 - "Discovery": the first Petroleum encountered in a Reservoir by drilling that is recoverable at the surface by conventional petroleum industry methods;

2 - "Commercial Discovery": a discovery which has been deemed to be commercial for Development purposes by the holder of Exploration and Production right;

3 - "Region": Kurdistan region or any other regions created in Iraq after issuing this law according to the Iraqi constitution

4 - "Good Oilfield Practices" All those practices related to petroleum operations that are generally accepted by the international petroleum industry as as good, safe, environmentally friendly, economic and efficient In exploring for and producing Petroleum

5 - "Good Pipeline Practices" - all those practices related to transportation by pipelines including the design, construction, commissioning, maintenance, operation and decommissioning of pipelines that are generally accepted in the international petroleum industry as good, safe, environmentally friendly, economic and efficient in transporting Petroleum:

6 - "Production" - the extraction and disposal of Petroleum;

7 - "Petroleum" - all Crude Oil or Natural Gas, or other hydrocarbons produced or capable of being produced from Crude Oil, Natural Gas, oil rocks or tar sands;

8 - "Development": the activities carried out by the holder of Exploration and Production right based on either the Field Development Plan or the Main Pipeline Development Plan, which aim at Production and transportation of Petroleum;

9 - "Exploration": the search for Petroleum by geological, geophysical and other
means including drilling of Exploration and appraisal wells;

10 - "Field" - An area consisting of a single Reservoir or multiple Reservoirs all grouped on, or related to, the same individual geological structural feature or stratigraphic condition. The field name refers to the surface area, although it may refer to both the surface and the underground productive formations.

11 - "Field Pipeline" - a pipeline, including valve stations, pump stations, compressor stations and associated installations, collecting crude oil or natural gas from a field or a group of fields and delivering it to a transfer point for further transportation;

12 - Pipeline: an entity that consists of a linear pipeline accompanied with other components on the ground level including stations of pumping, valves, compression, and other accompanied accessories for gauging, supervision, telecommunications, remote control, for the purposes of transporting crude oil and natural gas from the transfer point to the delivery point.

13 - "Main Pipeline" - The principal pipeline, including valve stations, pump stations, compressor stations and associated installations built by the transporter, for the transportation of crude oil or natural gas from one or several fields or sources inside or outside Iraq;

14 - "Field Development Plan" - a scheduled programme and cost estimate specifying the appraisal and development activities required to develop and produce petroleum from a specific field or group of fields by the holder of an exploration and production contract, prepared in accordance with this law and the relevant provisions in the Regulations for Petroleum Operations and the Exploration and Production Contract covering that contract Area;

15 - "Main Pipeline Development Plan" - A scheme and cost estimate specifying all activities to be carried out by the transporter for the transportation of petroleum by pipeline inside Iraq and across the territory of neighbouring States, prepared in accordance with this Law, the relevant provisions in the regulations for Petroleum Operations and the Exploration and Production Contract covering that Contract Area and any relevant bilateral agreements.

16 - "Decommissioning Plan": a scheme for the closure of Petroleum Operations and restoration of the operating environment including the removal and disposal of all installations;

17 - "Iraqi Person"- Any citizen with Iraqi nationality or any company or institution with legal personality established and registered pursuant to Iraqi legislation, with its headquarters in Iraq and having at least 50% of its share capital held by national citizens or by Iraqi public or private companies or institutions;

18 - "Foreign Person" Any non-Iraqi citizen or any company or institution with legal personality established and registered pursuant to Iraqi legislation, and having less than 50% of its share capital held by national citizens or by Iraqi public or private companies or institutions;

19 - "Petroleum Operations" - all or any of the activities related to Exploration, Development, Production, separation and treatment, storage, transportation and sale or delivery of Petroleum at the Delivery Point, Export Point or to the agreed Supply Point inside or outside Iraq. And includes Natural Gas treatment operations and the closure of all concluded activities;

20 - "Natural Gas" - all hydrocarbons which are in a gaseous state at atmospheric conditions of temperature and pressure, that might be associated or not with liquid hydrocarbons, as well as the residue gas remaining after the extraction of liquid hydrocarbons from the reservoir;

21 -"Associated Natural Gas": Natural Gas which under reservoir conditions is either in solution with liquid hydrocarbons or as gas-cap gas which overlies and is in contact with Crude Oil;

22 - "Non-associated Natural Gas" - The free Natural Gas other than Associated Natural Gas;

23 - "Operator" -the entity designated by the Government, in consultation with the holder of Exploration and Production right, to conduct Petroleum Operations on behalf of the latter;

24 - "Producing province": any Iraqi province that produces crude oil and natural gas continually on rates more than 150 thousand barrels a day (needs revision)

25 - "Reservoir" - a separate accumulation of Petroleum in a geological unit limited by rock characteristics, structural or stratigraphic boundaries, contact surfaces between Petroleum and water in the formation. Or a combination of these, so that Petroleum Production from any portion of the accumulation will affect the pressure in the accumulation as a whole;

26 - "Contract Area": the area within which the holder of an Exploration and Production right is authorized to explore for, develop and produce Petroleum;

27 - "Development and Production Area": a part of the Contract Area which following a Commercial Discovery has been delineated according to the terms and conditions of the Exploration and Production Contract;

28 - "Crude Oil" - all hydrocarbons, regardless of specific gravity, which are produced and saved from the Field in liquid state at atmospheric pressure and temperature, including asphalt, tar and the liquid hydrocarbons known as distillates or condensates obtained from Natural Gas within the Contract Area;

29 - 'Transporter" - the entity designated by the Council of Ministers to receive Crude Oil or Natural Gas from the holder of Exploration and Production right at the Transfer Point and deliver Crude Oil for export or Natural Gas to the holder of Exploration and Production right at the Delivery Point.

30 - "Production Measurement Point" - the place(s) at which volumes and qualities of Crude Oil or Natural Gas to be transferred at the Transfer Point are measured;

31 - "Transfer Point" - the inlet flange(s) of the outgoing Pipelines from the Production Measurement Point, where the Transporter shall receive Crude Oil or Natural Gas from the holder of Exploration and Production right;

32 - "Delivery Point" - the point(s) of the loading facility at which Crude Oil reaches the inlet flange of the receiving tank-ship or such other point inside or outside Iraq, as agreed to under the Exploration and Production Contract. In the case of Gas it is the flange of the inlet to the receiving installation for Natural Gas;

33 - "Supply Point" - the place at which Crude Oil or Natural Gas is transferred from a Main Pipeline or a Field Pipeline to a different type of transport, processing or use;

34 - "The Ministry" - is the Ministry of Oil in the Republic of Iraq and other companies and organizations specifically authorized by it;

35 - "Specialized institute" : Ministry of Oil, National Iraqi Oil Company, or regional institute

36 - "Regional institute": specialized ministry in the regional government.

CHAPTER II: MANAGEMENT OF PETROLEUM RESOURCES

ARTICLE 5: COMPETENCE OF AUTHORITIES

A. The Council of Representatives

First: shall enact all Federal legislation on crude oil and natural gas;

Second: council of representatives shall approve all international petroleum treaties that Iraq signs with other countries that are related to petroleum operations

B. Council of Ministers

First: The council of ministers shall be responsible for recommending proposed legislation on the development of the country's Petroleum resources for introduction into the National Assembly.

Second: The Council of Ministers is the competent authority to formulate Federal Petroleum policy and supervise its implementation. It also administers the overall Petroleum Operations including the formulation of Federal policy on all matters within the scope of this law including i.e. Exploration, Production, Transportation, Marketing, the proposal of Petroleum -legislation, and the approval of such regulations as may be necessary from time to time on the said matters.

Third: In carrying out the above functions, the Council of Ministers shall ensure that the Ministry adopts appropriate and effective mechanisms for consultation and co-ordination with the Provincial, Govenatorial petroleum production authorities

C. Federal Oil and Gas Council

First: To assist the Council of Ministers in creating Petroleum policies and related plans, arranged by the ministry in coordination with the producing provinces and regions, and to put important legislation for exploration and production based on ARTICLE 9 of this law the ministers council creates an entity to be named “the
Federal Oil and Gas Council”. The Prime Minister or his/her representative shall be the president of this council, and the council should include:
1 - Federal Government’s Ministers from the ministries of oil, treasury, planning, and cooperative development.
2 - The director of the Iraqi central bank
3 - A regional government minister representing each region.
4 - A representative from each producing province not included in a region
5 - Executive managers of from important related petroleum companies including the national Iraqi oil company and the oil marketing company
6 - Three or less experts specialized in petroleum, finance, and economy to be hired for a period not exceeding 5 years based on a resolution from the council of ministers.

Second: the Federal Oil and Gas Council holds the responsibility of putting federal petroleum policies, exploration plans, fields’ development and main pipelines plans inside Iraq, and this council has the authority to approve any major changes in such plans and policies.

Third: the Federal Oil and Gas Council reviews and changes the exploration and production contracts that give the rights of petroleum operations according to ARTICLE 9 of this law inside Iraq.

Fourth: the Federal Oil and Gas Council approves the types of exploration and production contracts, and chooses the appropriate contract type for the field nature or exploration area or based on offers.

Fifth: the Federal Oil and Gas Council decides the special instructions for negotiations pertaining to granting rights or signing development and production contracts, and setting qualification criteria for companies.

Sixth: To assist the Federal Oil and Gas Council in reviewing exploration and production contracts and petroleum fields’ development plans, the council rely on the assistant of a bureau called the “independent consultants’ bureau” that includes crude oil and natural gas experts, both Iraqis foreigners, this council decides their number, and they should be qualified and have a good reputation and long practical experience in exploration and production operation and in petroleum contracts, and they should be chosen by consensus of the council and contracted for a renewable one year contract. The independent consultants’ bureau gives its recommendations and advice to the Federal Oil and Gas Council in issues related to rights contracts, fields’ development plans, and any other related issues requested by the Federal Oil and Gas Council.

Seventh: the Federal Oil and Gas Council is the competent authority to approve the transfer of rights among holders of Exploration and Production right and associated amendment of contracts provided this does not adversely affect the national content including the percentage of national participation.

Eighth: the Federal Oil and Gas Council is responsible for ensuring that Petroleum resources are discovered, developed, and produced in an optimal manner and in the best interest of the people in accordance with legislation, regulations and contractual conditions as well as recognised international standards.

Ninth: The Federal Oil and Gas Council have the right to create any entities important for implementing its duties, and to create its bylaws.

Tenth: Members of the Federal Oil and Gas Council can suggest policies and law drafts to the Federal Oil and Gas Council.

D. Ministry of Oil

First: The Ministry is the competent authority for proposing Federal policy, laws and plans.

Second: The Ministry creates legislation as well as issuing regulations and guidelines to implement the feral plans.

Third: The Ministry undertakes the necessary monitoring, supervisory, regulatory and administrative actions required to ensure the proper, coordinated, and unified implementation all over Iraq.

Fourth: On the basis of policies, regulations, guidelines and requirements under ARTICLE 5/D/First and 5/D/Second above, and in accordance with the overall economic and social policies of the Federal Government, the Ministry shall in consultation with the petroleum producing provinces and regional authorities draw up
Federal policies and plans on Exploration, Development and Production on an annual or as needed basis. Such policies and plans shall address both the short term as well as the long term requirements. The geographical distribution and timing of actions and projects shall comprise proposals from the Provinces and Governorates in accordance to ARTICLEs 1, 2 and 3. The suggestions for petroleum policies and related plans are to be submitted to the Federal Oil and Gas Council to be reviewed and approved.

Fifth: The Ministry is the competent authority to represent the Iraqi Republic in regional and international forums.

Sixth: The Ministry is empowered to negotiate international and bilateral agreements related to Oil and Gas with other countries and organizations subject to approval in accordance with the Constitution.

Seventh: The ministry is responsible of monitoring petroleum operations to ensure adherence with the laws, regulations, and contracting terms. In addition to its administrative and technical monitoring duties, the ministry shall carry out verification of costs and expenditures incurred by the holders of rights to ensure correct and justified cost recoveries for the purpose of determining revenues accruing to government. The ministry shall through inspection, technical audits and other appropriate actions verify conformance with legislation, regulations, contractual terms and internationally recognised practices. The ministry must coordinate with regions’ governments and producing provinces to create specialized entities that carry out the ministry’s responsibilities.

Eighth: The Ministry has the right to execute contracts related to Oil and gas supply services other than those covered by ARTICLE 5/B/second and in other applicable legislation.

E. Iraqi National Oil Company

First: The Iraqi National Oil Company (INOC), in accordance with ARTICLE 6 of this law, can participate in exploration and production operations inside Iraq on behalf of the Iraqi government. INOC is obligated to sell its share of crude oil to the Oil Marketing Company based on the delivery price that covers the cost in addition to a reasonable profit that would facilitate the company’s development in exploration and production.

Second: The tasks and scope of operation of INOC shall include carrying out Oil and Gas Exploration, Development, Production, Transportation, Storage, Marketing and sales down to the Delivery Point in accordance with the rights and obligations under this Jaw including the necessary contracts, permits and approvals applicable to all other holders of rights.

Third: INOC shall have the right to participate as a commercial partner in international projects related to the transportation, marketing and sale of Oil and Gas. It may also participate in Exploration and Production contracts outside the Republic of Iraq subject to approval by the Council of Ministers.

Fourth: INOC shall form fully owned Subsidiary companies in selected areas in Iraq based on the location of fields, size of petroleum reserves, production capacity and cost benefit analysis, or based on rearrangements and task management of existing companies based on its work capacity leading to better efficiency based on appropriate bylaws and procedures to be issued for the purpose.

Fifth: INOC shall have the right to establish in association with others affiliated companies or acquire shares in existing companies inside the Republic of Iraq. INOC may also undertake the same outside the Republic of Iraq subject to the approval of the Council of ministers.

Sixth: INOG shall have the right to acquire tangible and intangible assets belonging to natural or legal entities for the purpose of achieving its objectives and in accordance with the law.

Seventh: INOC shall also establish wholly owned subsidiary companies to perform common services in participation with partners from regions and producing provinces.

F. Provincial Authorities

The provincial authorities shall have the following competencies:

First: The Province authorities shall undertake the necessary preparations in order to propose to the Federal authorities activities and plans on behalf of the Province to be included in the Federal plans for Petroleum Operations. It shall further assist the Federal authorities in discussions leading to the finalisation of the Federal plan as required.

Second: Participate in the licensing process regarding activities within its respective province related to exploration and production of discovered but undeveloped fields mentioned in appendix number 3 according to mechanisms motioned in ARTICLE 9 and based on contracting types prepared by the Federal Oil and Gas Council and in accordance to regulations issued by Federal Oil and Gas Council with qualified international oil companies adherent to the bases put by the Federal Oil and Gas Council.

Third: Be represented in discussions carried out by the Oil and Gas Commission In accordance with ARTICLE [5/C/First] of this law.

Fourth: Collaborate with the Ministry to undertake the monitoring and supervision of Petroleum Operations to ensure adherence to legislation, regulations, guidelines and the specific terms of the relevant Exploration and Production Contracts. Such functions shall be carried out in close coordination and harmonisation with the Ministry to ensure uniform and consistent implementation throughout the Republic of Iraq.

ARTICLE 6: Iraqi National Oil Company

A - The Iraqi National Oil Company (INOC) a holding company fully owned by the Iraqi Government and based in Baghdad. INOC is financially and administratively independent and is based on commercial bases.

B - Its scope of operations shall include:

First: Managing and operating existing producing fields mentioned in appendix 1, and both the North Oil Company and the South Oil Company are linked to it.

Second: Participation in the Development and Production of discovered and yet not developed fields mentioned in appendix 2.

Third: Carrying out for Exploration and Production operations in new areas outside its respective areas in adherent to this law through applying for Exploration and Production rights in the new areas based on competition.

Fourth: INOC shall also own, manage and operate the Main oil and Gas Pipeline network and the export ports in the Republic of Iraq and enter into contracts with existing and future shippers of oil and Gas in accordance with this law. The company continues its responsibilities in operating the Main oil and Gas Pipeline network and the export ports in Iraq during a transitional period not exceeding two years until rearranging the ministry of oil companies. Then, the Federal oil and gas Council decides the entity responsible of operating the Main oil and Gas Pipeline network and the export ports in Iraq based on a proposal submitted by the ministry after coordinating with the INOC in adherent to this law and after the approval of the ministers council.

Fifth: To ensure and develop the coordination and collaboration with regions and producing provinces, the INOC establishes subsidiary companies which it owns in total and which will control the petroleum operations in the regions and producing provinces; these subsidiary companies will be represented on the INOC board and
will be paid for the cost they incur in addition to a specific reasonable profit in order that they can develop and enhance their operations.

Sixth: The board of the INOC oversees the INOC and its subsidiary companies; in accordance to the INOC law, the board includes members from the federal government, the regions, and the producing provinces

ARTICLE 7 : Ministry of Oil

A - The ministry, according to law, must create the important institutional and methodology changes to cope with its new responsibilities and duties. In particular, the ministry has to create a new department as soon as possible specialized in planning, developing, and following up the process of obtaining rights. This new department must consist of members of the ministry trained and specialized in operating bids and auctions and conduct professional negotiations with oil companies to sign contracts of exploration and production rights in adherent to the ministry’s authorities and in accordance to ARTICLE number 9 of this law. In addition, this department must include in each and every negotiations representatives from the related producing provinces. It is permissible that the negotiation and rights teams include expert advisers with a distinguished international reputation and experience.

B - The law of rearrangement the ministry of oil must include the suggested mechanisms that will be the basis of re-structuring the relationship between the ministry and other related companies and regulating entities in a way that guarantees a full separation between on the one hand the production companies and oil services
and on the other hand the regulatory, monitory, supervisory, departments in the ministry. In addition, the production departments must be separated yet integrated from the services departments in a way that guarantees increasing productivity and maximizing profits.

ARTICLE 8 : Fields development and oil and gas exploration

A - Regarding the priorities aimed at restoring and increasing production related to existing fields, the INOC is the operator and is authorized to directly sign services contracts or administrative contracts with appropriate oil or services companies, in case this was needed to accelerate reaching to the goals stated in the ARTICLE.

B - The ministry, and after coordinating with regions and producing provinces, and in adherence to ARTICLE 9 of this law, is to propose to the Federal oil and gas Council the best methods to develop the discovered but yet not developed fields.

C - The ministry prepares model exploration and production contracts to be approved by the Federal Oil and Gas Council and to be appended to this law. These model contracts must guarantee the best levels of coordination between the oil ministry, INOC, and the regions each according to their specific responsibility in relation to both this law and the international oil companies.

D - The utmost efforts must be put into insuring speedy and efficient development of the fields discovered but partially or entirely not yet developed when this law is enacted, and it is permissible to develop these fields in collaboration with reputable oil companies that have the efficient financial, administrative, technical, operational capabilities according to the contracting terms and the regulations issued by the Federal Oil and Gas Council.

E - The Federal oil and gas Council, the oil ministry, INOC, and the regional entities have to carry out an exploratory program in Iraq to asses the oil and gas assists, compensate production, and add new reserves.

F - The ministry must provide the federal oil and gas council with a comprehensive proposal for oil and gas exploration throughout the Republic of Iraq in coordination with the regions and the producing provinces, sorting out the areas according to their oil and gas potentials, implemented within a short time table in order to guarantee increasing reserves and continuing and developing production.

ARTICLE 9 : GRANT OF RIGHTS

A - The rights for conducting Petroleum Operations shall be granted on the basis of an Exploration and Production contract. The contract shall be entered between the Ministry (or the regional entity) and an Iraqi or Foreign Person, natural or legal, which has demonstrated to the Ministry the technical competence and financial capability that are adequate for the efficient conduct of Petroleum Operations according to what the Federal oil and gas Council and mentioned in ARTICLE 5/C/Fifth, and in accordance to the mechanisms of negotiations and contracting mentioned in ARTICLE 10 of this law. shall not be granted to Foreign Persons, singular or plural whose countries of Origin do not allow Iraqi entities to seek reciprocal opportunities. The contracts shall be approved by the Council of Ministers of the Republic of Iraq.

B - The licensing process shall be based on transparent and accountable tendering and shall take into account recognised practices by the international petroleum industry. It shall adhere to the following principles and procedures:

First: Competitive licensing rounds based on clearly defined terms and terms of application as well as the criteria to be used in the selection of successful candidates.

Second: The contractual terms offered to applicants shall be specified in model contracts accompanying the letter of invitation.

Third: The form and terms of the model contract shall take account of the specific characteristics and requirements of the individual area, field or prospect being offered, including whether the resources are discovered or not, the risks and potential rewards associated with the investments under consideration, and the technological and operational challenges presented.

Fourth: All model contracts shall be formulated to honour the following objectives and criteria:
1 - National control,
2 - Ownership of the resources,
3 - Optimum economic rent to the country,
4 - An appropriate return on investment to the Investor,
5 - Reasonable incentives to the investor for ensuring solutions which are optimal to the country in the long-term related to:
a - Improved and enhanced recovery,
b - Technology transfer.
c - Training and development of Iraqi personnel,
d - Optimal utilisation of the Infrastructure,
e - Environmentally friendly solutions and plans.

Fifth: The Model Contracts may be based upon Service Contract, exploration risk contract, or exploration and production contract Buy-back Contract and Production Sharing Contract (PSC) provided they are adapted to best meet the objectives and criteria under 9/b above which serve the best interest of the Republic of Iraq.

Sixth: Only pre-qualified companies by the ministry or the regional entity shall be considered in any licensing round. The criteria for prequalification shall be specified in the Invitation to bidding according to the regulation and instructions put by the Federal oil and gas Council.

Seventh: Evaluation of pre-qualified applicants shall aim at establishing a short list of successful candidates for negotiations.

Eighth: The selection and ranking of successful applicants shall be on the basis of the quality and relevance of the proposed work plan and the anticipated economic rent to the nation.

Ninth: The overall allocation of Exploration and Production rights throughout the Republic of Iraq shall aim at achieving variety among oil companies and operators with different background, expertise, experience and approach so as to enhance efficiency through positive competition, benchmarking of performance and transparency. The possibility of using consortia of selected companies, particularly in large fields, should be considered.

Tenth: Not later than two months after the endorsement of approval of Exploration and Production contracts by the Council of Ministers the text of the contract shall be made public.

C - The granting of rights for the activities referred to in ARTICLE 1/6 shall always respect national interests, including but not restricted to those related to defence, navigation, research and development, conservation, health and safety and a high level of environmental protection.

D - The Ministry is to regulate the form and manner in which rights are granted under this ARTICLE in a manner consistent with this law and the regulations of the Federal Oil and Gas Counicl.

ARTICLE 10 : Mechanisms of Negotiations and contracting

A - The Ministry, the INOC, or the regional entity, based on their respective specialties and responsibilities, and after completing initial procedures for granting rights as indicated in ARTICLE 9, there will be an initial signing of exploration and production contracts with the selected contractor

B - The exploration and production contracts mentioned in ARTICLE 10/A must include the following: “the contract is valid unless it is rejected by the federal oil and gas council”

C - The initial contract mentioned in ARTICLE 10-B must be submitted to the federal oil and gas council within thirty days from the day of the initial signing or it will be considered cancelled

D - The federal oil and gas council must adhere to the following steps when deciding on the contracts submitted to it by Ministry, INOC, or the regions:

First: Submitting the initial contract mentioned in ARTICLE 10/C, if the Federal Oil and Gas Council finds it advisable, to the independent consultants bureau for analysis who will provide their opinion and assess whether the contract adheres to the model contracts approved by the Federal Oil and Law Council and to its regulations pertaining to exploration and production rights in accordance to ARTICLE 9

Second: In case the initial contract has serious discrepancies as compared to the model contracts and regulations approved by the Federal Oil and Gas Council, the Federal Oil and Gas Council will make a decision on the contract based on the recommendations of the independent consultants bureau; the decision requires a 2/3 majority of the members in attendance

Third: The Ministry, INOC, or the regional entity must be informed of the rejections of the initial contract in accordance to the legal reasons within (60) sixty days of receipt of the initial contract by the Federal oil and gas Council, and the contract is to be considered approved in case no decision was made by the Federal Oil and Gas Council within the mentioned period. In case the Federal Oil and Gas Council could not hold a meeting within 60 days of receiving the initial contract due to extraordinary reasons, the council must take a decision regarding the contract within the second (60) sixty days using all the possible means, and the contract will be considered approved in case no decision was made by the Federal Oil and Gas Council within the mentioned period.

C - The Ministry, INOC, or the regional entity must fix the reasons behind the rejection of the Federal Oil and Gas Council trough changing the initial contract in the necessary way to get approved and submit it again according to the regulations mentioned in this ARTICLE.

ARTICLE 11 : Petroleum revenue

A - According to the constitution (articles 106, 111, 112, 121 third) regarding the ownership of the oil and gas resources, the distribution of its revenues, and monitoring the federal revenue distribution, the ministers council must submit a federal law draft to the representatives council regulating these matters in adherence to the sections of this article.

B - The oil revenues include all the government revenues from oil and gas, royalties, signing rewards and production rewards of petroleum contracts with foreign or local companies.

C - The revenues mentioned in article 11/A must be deposited in an account called “the oil revenue treasury” opened under the name of the Iraqi Central Bank specifically for this reason, and managed by the Council of Ministers and the ministry of treasury. The oil revenue treasury must be administrated by an independent entity headed by an employee whose rank is a minister. This entity must include representatives from the federal government, regions’ governments, provinces, and a number of independent consultants, and the entity must be associated with the Council of Ministers and must be formed directly after issuing this law. This entity must create its own bylaw, and must periodically publish all the financial data related to the oil revenue treasury.

D - The government’s revenue, including the oil revenue, must be distributed in through the federal budget in a fair and just way in adherence to the constitution.

E - Another treasury must be created under the name “The Future Treasury”, and a certain ratio of oil revenue must be deposited in this treasury regulated by the law.

ARTICLE 12 : PARTICIPATION OF THE STATE

A - The Republic of Iraq shall aim at achieving substantial national participation in the management and Development of its Petroleum resources in adherence to Article 111 of the constitution.

B - The Exploration and Production rights with regard to existing producing fields are hereby given to the INOC. The formal granting of additional Exploration and Production rights to INOC regarding not yet developed Fields shall be affected by the Ministry Federal Oil and Gas Council in accordance to article 6 and appendix 2 of this law.

C - The Main Pipeline network inside Iraqi territories is hereby assigned INOC or any specialized companies created by the ministry. The formal procedure for this assignment and necessary approvals shall be affected by the Ministry Federal Oil and Gas Council in accordance with article 21 this Law.

D - The Republic of Iraq reserves the right to participate in Petroleum Operations on in any phase of Petroleum Operations on terms and conditions that are established by contract.

E - The Ministry Federal Oil and Gas Council is authorised to designate INOC to exercise the Republic of Iraq's participation share in accordance with Article 12/4 of this law.

CHAPTER III: FIELDS EXPLORATION AND DEVELOPMENT ACTIVATES

ARTICLE 13: EXPLORATION AND PRODUCTION CONTRACT

A - An Exploration and Production Contract shall give the holder an exclusive right to conduct Petroleum Exploration and Production in the Contract Area. In addition, the contract shall give the holder the right of transportation in accordance with ARTICLE 21/A of this law.

B - Except if additional time is needed to complete the operations to assess a Discovery, the exclusive Exploration and Production right shall be granted as follows:
1 - A First Period shall be a maximum of four years.
2 - Subject to having fulfilled all commitments by the holder, the Ministry specialized entity may grant a Second Period of two years provided however that a substantial work programme is committed to under this period.

C - A Third Period of Exploration can for special considerations of continuity be granted by the Ministry specialized entity provided however that such extension is justified by the quality and substance of the work programme and does not exceed two years.

D - All extensions shall be subject to the provisions concerning the relinquishment of Contract Areas in adherent to the petroleum regulations.

E - In the event of a Discovery, the exclusive Exploration and Production right may be retained by the holder for the purposes of completing the operations initiated within a specified area to assess or determine the commercial value of a Discovery for an additional period of two years or, in the case of a non-associated Natural Gas Discovery, for an additional period not to exceed four years.

H - On the basis of a Field Development Plan prepared and approved in accordance with this law and the relevant contract, INOC and other holders of an Exploration and Production right may retain the exclusive right to develop and produce Petroleum within the limits of a Development and Production Area for a period to be determined by the Ministry Federal Oil and Gas Council varying from 15 to 20 years not exceeding 20 years dating from the date of approval of the Field Development Plan, depending on considerations related to optimal oil recovery and utilisation of existing infrastructure. In cases which for technical and economic considerations warrant longer Production period, the Council of Ministers, on newly negotiated terms, has the authority to grant an extension not exceeding 5 years. The remaining acreage outside the Development and Production Area shall be relinquished at the end of the Exploration and Production right.

I - The appointment of an Operator shall be approved by the Ministry Federal Oil and Gas Council (the specialized entity) and the procedures for such appointment are contained in the Contract.

ARTICLE 14: OBLIGATIONS OF THE HOLDERS OF EXPLORATION AND PRODUCTION RIGHT

A holder of Exploration and Production right is obliged, mutatis mutandis, to:

A - Conduct Petroleum Operations in accordance with the terms of this law, the Regulations for Petroleum Operations as well as other applicable legislation and Good Oil Field Practices;

B - Promptly report any Discovery within the Contract Area to the Ministry;

C - Conduct the necessary delineation and evaluation of the Discovery with a view to determining its commercial potential and keep the Ministry fully informed of progress and results;

D - In the event of a Commercial Discovery, prepare and submit to the Ministry specialized entity, in accordance with the Regulations for Petroleum Operations, a Field Development Plan for the Discovery:

E - Prepare and submit a revised Field Development Plan for any material amendment to the original Plan for approval by the Ministry specialized entity

F - Implement the Field Development Plan or the revisions thereto once these have been approved by the Ministry specialized entity;

G - Submit a Decommissioning Plan to the Ministry, not later than two years before the planned termination of Production;

H - Compensate the Injured parties for any losses or damages resulting from the conduct of the Petroleum Operations as provided by law;

I - When the national Interest so requires, give preference to the Ministry in the acquisition of Petroleum produced in the Contract Area, and access to pipeline transportation, in accordance with terms and conditions to be agreed upon with the Ministry;

J - Provide the greatest possible support for required research and development activities in connection with Petroleum Operations and endeavour to carry out as much of these activities by Iraqi institutions;

K - Collect, organise and maintain in good condition usable data from all phases and on all aspects of Petroleum Operations in accordance with this Law and with Petroleum regulations, and

L - At no cost, supply the Ministry and affiliated companies, with, all data collected and assembled from Petroleum Operations, in accordance with ARTICLE 19 of this Law.

ARTICLE 15: COMPETENCE BUILDING AND LOCAL CONTENT

A - The Republic of Iraq aims at the development of a competent and effective Iraqi private sector capable of substantial participation in Petroleum Operations including the acquisition, alone or together with international companies, of Exploration and Production rights. Such development shall however adhere to the objectives of professional competence in accordance with this law. Towards this end holders of Exploration rights are encouraged to pursue cooperation and association with serious and qualified Iraqi private Initiatives.

B - INOC and other holders of Exploration and Production rights shall give preference to the purchase of Iraqi products and services whenever they are competitive in terms of price, comparable in terms of quality and available on a timely basis in the quantity required.

C - INOC and other holders of Exploration and Production rights shall to the maximum reasonable extent undertake to employ Iraqi citizens having appropriate qualifications and shall undertake to train and prepare potential candidates towards this objective.

D - INOC and other holders of Exploration and Production rights shall maximise to the greatest reasonable extent, training and technology transfer opportunities for Iraqi nationals, at all levels of Petroleum Operations including management.

E - INOC and other holders of Exploration and Production rights are required to diligently seek and develop associations, affiliations, joint ventures and other forms of partnership and or co-operation in order to promote the rapid growth of an Iraqi private sector capable of assisting and enhancing Petroleum Operations to the mutual benefit of the said holders and the nation.

ARTICLE 16: UNITISATION

A - A Petroleum Discovery which is located partly in one Contract Area and partly in another Contract Area shall be developed and operated jointly pursuant to a unitization agreement which shall be submitted for approval by the Ministry Federal Oil and Gas Council to be approved. Should the right-holders fail to reach agreement on the modalities of unitisation, the Ministry Federal Oil and Gas Council has the right to decide on the terms six months after serving notice to the parties to this effect.

B - A Petroleum Discovery which extends from areas authorized for Production into areas not authorized for Production shall be developed only after consultation with the Ministry Federal Oil and Gas Council about the measures necessary to protect the interests of the Republic of Iraq.

C - The Council of Ministers shall adopt the necessary measures to protect the interests of the Republic of Iraq in Petroleum Discoveries extending beyond the borders of the Republic. In such cases efforts shall be made to seek joint solutions with the said neighbouring countries.

ARTICLE 17: CONSERVATION

A - The extraction of Petroleum resources shall aim at the avoidance of waste, including preventing leakages from Pipelines, and the optimal maintenance of energy in the Reservoir in accordance with Good Oilfield Practices and Good Pipeline Practices.

B - INOC and other holders of an Exploration and Production right shall diligently apply the latest technologies and oilfield practices that lead to optimum recovery from the individual Reservoir or a group of Reservoirs that are targeted under the Field Development Plan(s).

C - The Field Development Plan shall be based on thorough investigations of alternative extraction strategies in order to select a solution that combines the highest level of Petroleum recovery with acceptably high levels of Production and as low cost as possible.

D - Subsequent to the approval of a Field Development Plan, INOC and other holders of Exploration and Production right shall continue to improve Reservoir understanding through optimal data collection and Reservoir monitoring and shall accordingly seek to identify and implement actions that would Improve Petroleum recovery.

ARTICLE 18: ACCESS TO MAIN PIPELINES AND FIELD PIPELINES

A - The Main Pipelines are the property of the federal government.

B - INOC as the Transporter with respect to Main Pipelines and the holder of Exploration and Production right under ARTICLE 17/A with respect to Field Pipelines have the obligation to transport, without any discrimination and on reasonable commercial terms, the Petroleum of third parties, provided in general that:
1 - Capacity is available in the Field Pipeline;
2 - There are no insurmountable technical problems that prevent such utilisation of the Field Pipeline.

C - Details shall be provided for the modalities of the system of access by third parties to Field Pipelines in regulations to be made by the Ministry in coordination with the regions and producing provinces.

D - Whenever there is a dispute concerning the commercially reasonable terms for the transport of Petroleum in a Main Pipeline or a Field Pipeline for Oil or for Natural Gas, the availability of uncommitted capacity in the pipeline in question or a proposed increase of its capacity, the dispute shall be first referred to the Ministry for resolution, the ministry must work in coordination with regions and producing provinces. Thereafter, resolution shall be sought according to the procedures set out in ARTICLE 30 of this Law.

ARTICLE 19: OWNERSHIP OF DATA

A - All data obtained pursuant to any Contract provided for under this Law is the property of the Iraqi Government, and shall not be published, reproduced or exported without the prior approval of the Ministry.

B - The terms and conditions for the exercise of rights in respect of primary, differentiated, processes, interpreted and analysed data related to oil and gas in Iraq including but not limited to geological and geophysical reports, engineering data, samples, logs and well surveys, shall be established in data supply obligations in the relevant contract and by regulations.

C - The Ministry submits copies of the current available petroleum data to the INOC and to the regions, and the INOC and regions must take the responsibility of supplying the Ministry with new data and updates resulted from the petroleum operations implemented by them in a continues and periodic fashion.

D - Anyone who has the information in his possession or sells, buys, transfers, receives, deals with any of the information or data mentioned in this article shall be considered in violation, unless the contract terms states otherwise, and shall be prosecuted under the Iraqi criminal and civil law. No one has the right to own such
data and information.

E - Without prejudice to section D of this article, it is allowed for someone to have a permission from the specialized entities to own, buy, sell, transfer, or receive data and information indicated in section F of this article under the condition of supplying the specialized entities with copies of the data, and his permission should not be revoked without logical reasons.

F - Old Data, for the purposes of this law, mean all primary, differentiated, processes, interpreted and analysed data and information related to oil and gas in the republic of Iraq indicated in section [B] of this article.

ARTICLE 20: RESTRICTIONS ON PRODUCTION LEVELS

In the event that, for national policy considerations, there is a need to introduce limitations on the national level of Petroleum Production, such limitations shall be applied in a fair and equitable manner and on a pro-rata basis for each Contract Area on the basis of approved Field Development Plans.

CHAPTER IV: TRANSPORTATION

ARTICLE 21: MAIN PIPELINES

A - INOC, or the specialized company created by the Ministry, shall own all Main Pipelines. Such Pipelines shall be constructed and operated by the INOC subsidiary representing Transporter for the purpose of transporting Oil or Natural Gas to specified Delivery Points for Oil and Natural Gas respectively. The Ministry in co-ordination with INOC and in consultation with Operators shall ensure that the Main Pipeline network is optimally designed, operated and maintained so as to serve the overall requirement for Petroleum transportation in the Republic of Iraq.

B - The construction and operation of Main Pipeline or any major modification thereof shall be subject to approval by the Ministry on the basis of a Main Pipeline Development Plan outlining the proposed work. If the proposed work is undertaken by the INOC subsidiary company specialized company representing Transporter in association with Iraqi or Foreign Persons, the agreement between' the parties shall accompany the Main Pipeline Development Plan. Such agreement shall outline the terms of financing, implementation, and the modalities of utilisation and operation of the new or modified Main Pipeline.

C - INOC and other holders of Exploration and Production right shall deliver Oil and Natural Gas to the Main Pipeline at appropriate Transfer Point(s) In accordance with ARTICLE 13/A. The transportation of Crude Oil or Natural Gas beyond the Transfer Point shall be carried out by the INOC subsidiary company specialized company representing Transporter on the basis of a contract.

D - All the above activities shall be carried out in accordance with Good Pipeline Practices.

E - The co-ordination of tasks related to the transport of Crude Oil through new Pipelines outside the Iraqi territories is the responsibility of the Ministry. The Follow up of operations subsequent to the approval of the necessary bilateral agreements shall be the responsibility of INOC in accordance with the said bilateral agreements and any specific instructions from the Ministry.

ARTICLE 22: RIGHTS AND OBLIGATIONS REGARDING PIPELINES

A - The Exploration and Production Contract shall provide a non-exclusive right to access Main Pipelines on reasonable commercial terms. It shall also confer the right to construct and operate Field Pipelines to deliver Oil or Natural Gas from the Contract Area to the Transfer Point, for further transportation through the Main Pipeline to the Delivery Point.

B - INOC and of her holders of Exploration and Production right shall Implement the Field Development Plan and construct Field Pipelines connected to the Main Pipeline or the modifications thereto following approval of such plans have been approved by
the Ministry;

C - INOC and other holders of Exploration and Production right shall prepare and submit a revised Field Pipeline Development Plan for any material amendment to the original Plan for approval by the Ministry;

D - INOC and other holders of Exploration and Production right shall negotiate with INOC or the specialized company as the Transporter for the right to use the Main Pipeline. The Ministry Is to be kept informed on the progress of these negotiations;

E - INOC and other holders of Exploration and Production right shall submit a Decommissioning Plan to the Ministry, not later than two years before the planned termination of Production;

CHAPTER V: NATURAL GAS

ARTICLE 23: GAS UTILISATION

A - Natural Gas is a valuable Petroleum resource of increasing importance in the economic development of the Republic of Iraq and the Middle East. It shall be utilised to generate additional revenues through optimal utilisation partly through improving oil recoveries by gas injection into suitable Reservoirs; through utilisation for power generation, utilisation in petrochemical and chemical industries, utilisation for domestic purposes, utilisation in Industrial processes, utilisation for export and/or through the replacement of fluid fuels. The latter will have the additional benefit of reducing the impact on the environment while at the same time maximising revenue by freeing more crude and fuel oil for export.

B - INOC and other holders of Exploration and Production rights shall diligently pursue all alternatives for optimal utilisation of surplus volumes of produced gases in accordance with the objectives of ARTICLE 23/B above. Should they fail to identify commercial utilisation, the volumes of surplus Natural Gas shall be offered after treatment to Government at no cost at the Field's outlet. The cost incurred by the holder of Exploration and Production rights shall be recoverable under the respective contract.

ARTICLE 24: ASSOCIATED GAS

A - INOC and other holders of Exploration and Production right are entitled to use, free of charge, the quantity of Associated Natural Gas necessary for Petroleum Operations.

B - INOC and other holders of Exploration and Production right shall in the Field Development Plan propose optimal plans for the utilization or disposal of Associated Natural Gas.

C - All Associated Natural Gas produced from a Reservoir which is neither used in Petroleum Operations, utilised or re-injected in the Field, shall be offered for delivery free of charge to the Ministry in accordance with ARTICLE 23/B above.

ARTICLE 25: FLARING OF NATURAL GAS

A - Flaring of Natural Gas is only permitted for the purposes of commissioning, testing of installations, safety precautions or while awaiting the completion of transportation facilities provided the flared volumes are strictly kept to a minimum and the Ministry is promptly notified.

B - The flaring of Associated Natural Gas shall be kept to a minimum. It shall not be permitted beyond a maximum period of one year during which measures shall be completed to utilise the gas or deliver it to a nominated government entity in accordance with ARTICLE 23/B above

ARTICLE 26: NON-ASSOCIATED GAS

A - The Development and Production of Natural Gas or liquid components thereof from a Non-associated Natural Gas Discovery shall be subject to the approval of the Ministry of a Field Development Plan supported by signed agreement(s) for the sale of Natural Gas from the Discovery and approved by the Council of Ministers. In the event that only liquid Petroleum is to be produced, a scheme for the re-injection of Natural Gas or other acceptable schemes for its disposal shall be presented in the Field Development Plan.

B - The flaring of Non-associated Natural Gas may only be permitted in accordance with ARTICLE 25/B.

CHAPTER VI: REGULATORY MATTERS

ARTICLE 27: REGULATIONS FOR PETROLEUM OPERATIONS

The Ministry, in coordination and collaboration with the INOC, regions, and producing provinces, shall approve regulations for Petroleum Operations and submit it to the Federal Oil and Gas Council to be Approved.

1 - Such regulations shall include among other matters, the following:
a) Modality, terms and conditions of Contracts;
b) Petroleum Operations practices including resource management, safety, health and environmental protection;
c) Submission of plans, reports, data, samples, information and accounts by INOC and other holders of rights as provided for In the respective contracts;
d) Utilisation of pipeline systems for Oil and Natural Gas;
e) The procurement of equipment, goods and services for Petroleum Operations.
f) The utilisation of local goods and services in Petroleum Operations.
g) Guidelines and conditions related to reciprocity of granting of rights with the country of origin of applicants to rights.

2- The Ministry shall prepare and submit regulations for Petroleum Operations under his Law as required, to be approved by the Council of Ministers.

3- The Ministry may by means of such regulations designate some of its obligations to its associated companies, organisations and Ministerial departments.

ARTICLE 28: USE AND BENEFIT OF LAND AND RIGHTS OF WAY

A - Land use and benefit for the purpose of conducting Petroleum Operations is regulated by the legislation on land use and benefit, without prejudice to the following provisions.

B - For the purpose of conducting Petroleum Operations, the duration of the right of use and benefit of the land shall be the same as the duration of the Contract.

C - The land where installations are located, and a strip of land, to be defined by regulation, surrounding those Installations, are considered to be a zone of partial protection in accordance with the legislation on land use and benefit.

D - INOC and other holders of a right to conduct Petroleum Operations who, by virtue of the exercise of Petroleum Operation rights in the Contract Area, causes damage to crops, soils, building and improvements or requires the relocation of the legal users or occupants of the land within the respective Contract Area, has the obligation to compensate the holders of title to the assets and the persons relocated.

E - Subject to the payment of the compensation that are due, the holder of the right to conduct Petroleum Operations may require the right of way in accordance with the legislation in force, in order to have access to the locations where Petroleum Operations are conducted.

F - In cases where lands and rights of way are owned by an Iraqi Person, the land shall be either rented or bought by the relevant state owned company, according to the applicable laws and regulations.

ARTICLE 29: ACCESS TO ZONES SUBJECT TO MARITIME JURISDICTION

The access to Petroleum Operations sites located in interior waters, the territorial waters, and other zones subject to maritime jurisdiction is regulated by law, and any relevant international agreements.

ARTICLE 30: INSPECTION

A - The Ministry Specialized entity, or its authorized representatives, has the right to inspect sites, including buildings and installations, where Petroleum Operations are being conducted, as well as all assets, records and data kept by INOC and other holders of Exploration and Production right relating to Petroleum Operations.

B - The Ministry Specialized Entity may designate an independent entity or a commission created for this purpose, to any out the inspection.

C - The terms and conditions pursuant to which the Inspection is carried out shall be established by regulations.

D - In carrying out its inspections, the Ministry Specialized Entity shall not unreasonably interfere with the Petroleum Operations.

ARTICLE 31: ENVIRONMENTAL PROTECTION AND SAFETY

In addition to carrying out their Operations in accordance with Good Oil Field Practices, INOC and other holders of Exploration and Production rights shall conduct Petroleum Operations in accordance with environmental and other applicable legislation of the Republic of Iraq to prevent pollution of air, lands and waters. They shall also conduct Petroleum Operations so as to comply with the environmental management standards of the ISO 14000 series, as amended. In general, they shall carry out Petroleum Operations in order to:

1 - Ensure that there is no ecological damage or destruction caused by Petroleum Operations, but where unavoidable, ensure that measures for protection of the environment are in accordance with internationally acceptable standards. For this purpose, INOC and other holders of a right shall prepare and submit to the relevant authorities for approval an environmental impact assessment, including environmental impact mitigation measures, for each major operation in the Contract Area;

2 - Notify the Ministry and other specified authorities immediately in the event of an emergency or accident affecting the environment;

3 - Control the flow and prevent the escape or loss of Petroleum discovered or produced within the Contract Area;

4 - Avoid damage to Petroleum Reservoirs;

5 - Avoid destruction to land, the water table, trees, crops, buildings or other Infrastructure and goods;

6 - Clean up the sites after the closure of Petroleum Operations and comply with the environmental resolution requirements;

7 - Ensure the health and safety of personnel in the planning and conduct of Petroleum Operations, and take preventive measures if their physical safety would be at risk;

8 - Report to the competent entity within the government on the amounts of operational and accidental discharge, leakage and waste resulting from Petroleum Operations, and

9 - Provide compensation for damages to State and private property in accordance with the applicable laws and regulations.

B - INOC and other holders of a right under this Law shall act in a secure and effective manner when conducting Petroleum Operations in order to guarantee the disposal of polluted water and waste oil in accordance with approved methods, as well as the safe plugging of all boreholes and wells before these are abandoned.

ARTICLE 32: TRANSFER OF OWNERSHIP AND DECOMMISSIONING

A - On completion of the Exploration and Production Contract or Main Pipeline Contract the ownership of all works and facilities shall be transferred to Ministry Specialized Entity. The properties shall be transferred to the relevant federal state enterprise or to the Ministry in actual operating condition and in a satisfactory state of work at the time of the transfer.

B - All site relinquishment and related costs that become due at the time of transfer with regards to any works and facilities shall be payable by INOC and other holders of Exploration and Production right according to a Decommissioning Plan, submitted in accordance with ARTICLE 9/F [sic] of this Law.

C - An outline Decommissioning Plan shall be included In the Field Development Plan submitted by the Contractor to the Council of Ministers.

CHAPTER VII: FISCAL REGIME

ARTICLE 33: GENERAL PRINCIPLES OF TAXATION

A - INOC and its subsidiary companies as well as other Individual and collective persons who are holders of a right to conduct Petroleum Operations are, subject to the payment of the following fiscal impositions:
1 - Royalty;
2 - Property Contribution and the Property Transfer Tax (SISA) as established in accordance with the law;
3 - Municipal and local taxes due;
4 - The taxes provided for in the Income Tax Code;

B - The Council of Ministers is authorised to establish a law regulating methods of taxation, the rates, tax exemptions applicable to Petroleum Exploration, Development and Production activities.

C - The Commission of Financial Audit has the authority to audit the income derived from Petroleum Operations and to publish it periodically.

D - A Foreign Person may repatriate its exports proceeds in accordance with the foreign exchange regulations in force at the time. It may freely transfer shares pertaining to any non-Iraqi partners in accordance to article 5/c/seventh.

ARTICLE 34: ROYALTY

A - INOC and other holders of an Exploration and Production right shall pay a royalty on Petroleum produced from the Development and Production Area, at the rate of 12.5% of Gross Production measured at the entry flange to the Main Pipeline.

B - The collection of Royalty shall be in kind or in cash at the option of the Ministry.

C - Where the royalty is paid in cash, it shall be calculated according to the prevailing Market Price in accordance with Petroleum Regulations.

ARTICLE 35: OTHER TAXATION ISSUES

A - Holders of Exploration and Production right can transfer any net profits from petroleum operations to outside Iraq after paying taxes and fees owed.

B - INOC and other holders of Exploration and Production right shall maintain proper records and books in both Arabic and English of accounts in accordance with the provisions of the Contract enabling the relevant calculations to be performed, and in compliance with the requirements of the laws relevant to the taxes referred to in
ARTICLE 33. INOC and other holders shall prepare and submit to the specialised entity annually, or quarterly, a statement of accounts.

CHAPTER VIII: MISCELLANEOUS PROVISIONS

ARTICLE 36: Transparency

A - All activities related to oil and gas, while occurring, have to be transparent and responsible. To ensure this transparency and give the Iraqi people the chance to hold governmental entities responsible for their activities and actions, different sorts of information must be published. This information includes but is not limited to the following:

1 - All the revenues, payments and receipts that are delivered to any governmental unit, or entity run by the government, from activities related to oil or gas. This includes but is not limited to the income of selling oil, gas and their products, signing and production rewards, royalties, revenue of selling assets, taxes, fees, customs and taxes, public services fees, share of profits from oil and gas cartels, commercial activates related to oil and gas (and their products) contracts, oil and gas revenue investment yield, and any other payments resulted from or related to commercial production of hydrocarbons.

2 - The revenues of oil and gas usage and distribution, including distribution among governmental entities.

3 - All of the financially significant contracts related to exploration, development, processing and marketing of oil and gas resources in Iraq

4 - All of the financially significant contracts related to importing or exporting services and goods for the oil and gas industry or by any governmental unit or entity controlled by the government

5 - The annual report of the Federal Oil and Gas Council

6 - The annual and quarterly reports of the INOC, the subsidiary companies, and the entities controlled by the government including the budgets audited according to international accounting standards

7 - All other information necessary for understanding the operations and activities carried out by any governmental unit or entities controlled by the government related to oil and gas

8 - Any information that must be declared in accordance to laws and regulations

9 - Any condition or secret agreement aimed at blocking or trying to block access to documents and information that must be made public in accordance to this article in considered in violation of the law and is considered void

B - Publicizing the information stated in Section A of this article does not extend to and has no effect on the oil and gas industry royalties that must be kept secret in accordance to the national or international laws except for financial information

C - Any person or governmental entity obligated to publish information mentioned in section A of this article shall publish it in publicly accessible media

D - The Ministry shall issue the regulations needed for implementing the laws of this section including the legal basis covering what should be included and an exempted as mentioned in Section B of this article

ARTICLE 37: Implementing Anti-Corruption laws

A - Any rights’ contract shall be considered void if it is in violation of any of the laws of the Republic of Iraq, particularly the Iraqi anti-corruption laws

B - The authorized person’s violation of the Iraqi anti-corruption may lead to the cancellation of his rights contract, in whole or in part. Each rights contract shall include terms indicating these conditions

C - Any person who violates the Iraqi Anti-corruption laws may be prosecuted under the criminal law active in Iraq

ARTICLE 38: Competitive Public Bidding

A - All oil companies working in the Republic of Iraq shall submit public bids on a competitive basis in order to offer any goods or services, and this should occur in accordance to the general bidding laws and the Federal Oil and Gas Council shall determine the maximum amount that can be excluded from the bidding process

B - Bidding by the holders of petroleum operations rights stated in this law shall be competitive and in accordance with the petroleum laws and with the special terms of the related contracts

C - All public bidding must be allowed to the public within a reasonable timeframe, must declare thereafter the reasons for selecting the chosen bid, the complete results of the bidding call must also be published, and competitors must be given the opportunity for raising objections

D - Any contract that is signed in violation of the regulations set by this article shall be considered void and inactive

E - In emergency cases or in case bidding is unsuccessful, the specialized entities shall decide exceptions to the requirements set by this article provided that these exceptions are declared and made public

ARTICLE 39: EXISTING CONTRACTS

The Ministry and regions have to review all the existing Exploration and Production contracts signed with any entity before this law was in place to ensure harmony with the goals and general regulations of this law. This review must be submitted to the Federal Oil and Gas Council, to ensure the maximum financial benefit for the Iraqi
people, in a period not exceeding three months from the time the Federal Oil and Gas Council issues model contracts and related regulations.

Any contract made under existing law concerning Exploration and Production of Petroleum in the territory of Iraq shall remain valid provided that it is revised to be in full agreement with the provisions of the Constitution and this law and shall be regulated by this Law.

ARTICLE 40: Changes in Administrative borders

In the case of changes in borders of regions or producing provinces, or in the case of establishing new provinces, the new effected places shall be dealt with in accordance to this law regarding to granting rights and petroleum operations.

ARTICLE 41: RESOLUTION OF DISPUTES

A - Any disputes arising from the interpretation and application of this Law, the Regulations for Petroleum Operations and the terms and conditions of contracts shall in the first instance be attempted to be resolved in good faith by means of negotiation among the parties.

B - If the dispute cannot be resolved by agreement, the matter shall be referred to the Minister to resolve through discussions with senior officers of the holders of rights concerned. Failing resolution through these discussions the matter of dispute may be submitted to arbitration or to the competent judicial authority.

C - If the dispute relates to a technical, engineering, operational or accounting matter relative to Petroleum Operations and is of a kind that is readily subject to resolution by an expert in the relevant field, the parties may refer the dispute to an independent technical expert for a recommendation as to the resolution of the dispute. If a party does not accept the recommendation of the expert, it may initiate arbitration proceedings according to ARTICLE 41/D below.

D - Arbitration between the State of Iraq and foreign investors shall be conducted in accordance with the Rules of Procedure for Arbitration Proceedings of Paris or Geneva Chamber of Commerce for the Settlement of Disputes between States and Nationals of other States or pursuant to the Convention on the Settlement of Disputes
between States and Nationals of other States and based on the Iraqi Law.

The rules of such other international instances of recognised standing as agreed by the parties to the contracts referred to in this law, provided that the parties have expressly defined in the contract the conditions for Implementation including the method for the designation of the arbitrators and the time limit within which the decision must be made.

FOR CONSIDERATION, SOME COUNTRIES DO NOT ACCEPT ARBITRATION BETWEEN A COMMERCIAL ENTERPRISE AND THEMSELVES ON THE BASIS OF SOVEREIGNTY OF THE STATE.

ARTICLE 42: RELATIONSHIP TO EXISTING LEGISLATION

Any article in prejudice to this law shall cease to be effective on adoption of this Law.

ARTICLE 43: ENTRY IN FORCE

This Law enters into force 30 days after publication in the Official Gazette.