Via the NYT: Iraqis Near Deal on Distribution of Oil Revenues by Population:
Iraqi officials are near agreement on a national oil law that would give the central government the power to distribute current and future oil revenues to the provinces or regions, based on their population, Iraqi and American officials say.
If enacted, the measure, drafted by a committee of politicians and ministers, could help resolve a highly divisive issue that has consistently blocked efforts to reconcile the country’s feuding ethnic and sectarian factions. Sunni Arabs, who lead the insurgency, have opposed the idea of regional autonomy for fear that they would be deprived of a fair share of the country’s oil wealth, which is concentrated in the Shiite south and Kurdish north.
The most important word in the above two paragraphs is “could.” And the issue is far from settled:
The major remaining stumbling block, officials said, concerns the issuing of contracts for developing future oil fields. The Kurds are insisting that the regions reserve final approval over such contracts, fearing that if that power were given to a Shiite-dominated central government, it could ignore proposed contracts in the Kurdish north while permitting them in the Shiite south, American and Iraqi officials said.
[...]
…the Kurds are still holding out on the issue of oil contracts, arguing that the Constitution guarantees the regions absolute rights in those matters. The Kurds recently discovered two new oil fields after signing exploration contracts with a Turkish company and a Norwegian company.
Oil is one of the chief reasons that a partition of Iraq into three separate states would lead to more violence, given the relationship of Sunnis to oil-less real estate.
A discussion of oil and oil revenues brings to fore, I would add, another example of failure on the part of the Bush administration’s Iraq policy: all that talk that oil would finance the post-invasion process and the rebuilding of Iraq.
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