International law would rule post-war Iraqi oil production

Jan 20, 2003 01:00 AM

Before the first shot is fired in an anticipated war with Iraq, US officials should sit down with representatives of various countries and oil companies with concession claims in that state to determine who will produce Iraq's oil once the shooting's ended, said an Oklahoma law professor.
An unknown number of oil and gas concessions in Iraq -- "some real, some promised, and some imaginary" -- have been awarded to several international oil companies outside of the US, including some state-owned companies, said R. Dobie Langenkamp, professor of law and director of the National Energy-Environment Law & Policy Institute at the University of Tulsa.

In addition to concessions granted through the official government process, relatives and friends of President Saddam Hussein have signed influence-peddling agreements that may or may not constitute concessions, he said. Moreover, representatives of opposition forces in exile are likely talking now to oil companies about possible concessions if their particular faction takes over after Hussein is forced out of office.
As a result, said Langenkamp, "France has a dog in this hunt; Russia has a dog in this hunt." He asked, "What's to keep France or Russia from later deciding they're going to participate in the invasion to protect their interests, especially if they land troops in the oil fields where their companies claim to have concessions?" Even if the anticipated war is quick and decisive, he said, it still would take months for US-led forces to secure control of Iraq's territory to prevent such incursions.

Under international laws governing warfare going back to the The Hague Convention of 1907 and the Geneva Conventions of 1929 and 1946, the US and its allies would have the right to produce Iraq's existing oil and gas wells and to use the proceeds to pay the costs of occupation, but not the costs of the war itself, Langenkamp said. Occupation costs mean more than the expense of maintaining troops within a defeated country, of course. International law also requires the occupying army to provide food, medicine, and education for local inhabitants.
At a Jan. 17 forum on Middle East oil at the University of Houston, Langenkamp said those same laws prevent a military takeover of private property, including "the undetermined or claimed rights of foreign contractors, joint venturers, and concessionaires." In fact, the law requires protection of their property.

Continued production of Iraq's wells also will require the cooperation of the national oil company and its employees, since Iraqi workers cannot be forced into servitude, and prolonged use of troops or foreign contractors to replace them is forbidden by international law, said Langenkamp. Slave labour was severely punished during the war crimes trials following World War II, he noted.
The law also prohibits unnecessary damage to Iraq's wells, which means they can't be produced so rapidly or carelessly as to damage formations, he said. Eventually the properties must be returned to the proper government authority in reasonable condition.

Although some proponents of military action against Iraq anticipate a quick increase in Iraqi oil production, the US Department of State is on record as claiming that drilling new wells in a military occupied territory is unlawful. US officials took that position years ago in opposition to Israel drilling exploration wells in territory it occupied from Egypt in the Sinai and from Jordan on the West Bank and offshore, Langenkamp said.
However, he said, Iraq's current production likely can be increased through workovers and by drilling existing wells deeper or through extensions to new formations. At any rate, Langenkamp said, an "operating authority" must be established to make such decisions, to select suppliers, consultants, and contractors, and to deal with the sale of the oil. Sale of Iraqi oil may be left under the current oil-for-aid program currently administered by the United Nations, he said.

Most important, Langenkamp said, occupying forces must make sure that rebel factions and tribal warlords are denied access to cash flow from those wells. "The reality is that Saddam and some other rulers in the Middle East could not be in power without oil revenue," said Joseph A. Pratt, Cullen professor of history and business at the University of Houston, another speaker at that conference.
"Many of these issues may be deferred if the occupation of Iraq lasts only 2 years," said Langenkamp. "But the question is whether the US and its allies can restore order in 2 years." Under international law, he said, "A hasty departure, followed by disorder, would violate our duty as a belligerent occupant."

Source: Oil & Gas Journal
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