IPC law will help adopt best management of oil resources – MP

BAGHDAD / IraqiNews.com: The Iraq Petroleum Company law will help adopt best management of Iraqi oil resources through dividing missions between the company and the oil ministry, a member of the parliament’s oil committee said Friday. “The law, which the economic committee received recently, will help adopt best management of oil resources which consider the main resource of income in Iraq through dividing missions between the company and the oil ministry,” Aamra al-Beldawi told Iraqi News. “The law, in case the parliament approved it, will benefit the Iraqi economy, mainly the re-establishment of the Iraqi National Oil Company (INOC),” she said. The Iraq Petroleum Company (IPC) was organized in 1928 from the remains of the Turkish Petroleum Company (TPC). Iraq’s conflicts with IPC began during the negotiations over the original TPC concession. The government had demanded a 20 percent equity share in the company to give it some influence on management policies, including production levels. The TPC partners resisted giving a share to Iraq and called upon their home governments, then engaged in carving the Ottoman Empire into mandates for themselves, to help them. Negotiations between the government of Iraq and IPC in the early 1960s were beset by the inability of each side to understand the reasons behind the positions taken by the other. In December 1962 Iraq’s Public Law 80 (PL 80) called for re-possession of more than 99 percent of IPC’s land-holdings, including its share of the southern oil fields. The law also established the Iraq National Oil Company (INOC). PL 80 allowed Iraq to preserve its income stream from IPC, which retained its producing properties in Kirkuk, but also initiated a protracted struggle with IPC over the law’s legitimacy. After intensive negotiations, IPC regained control of the southern oil fields in a new agreement initialed in 1965 but lost these rights after passage of Public Law 97 in August 1967, which gave INOC exclusive rights to develop all the territory expropriated under PL 80. IPC threatened to sue purchasers of oil from the disputed fields. Following the 1968 coup and the installation of the al-Baath party, the government of Iraq moved rapidly toward nationalization. Continued conflicts over IPC’s production rates, and company demands to be compensated for losses it had sustained as the result of PL 80, led to Public Law 69 (1 June 1972). This law nationalized IPC and established a state-owned company to take over its operations in Kirkuk. SH (S) 1