MGM&USP Document #70

Oil and Oil Profits:

The Primary Reason The U. S. is in Mideast

The US military is in the Mideast because well over half of easily accessible petroleum is there.

Iraq was invaded and occupied primarily to help U.S. and UK companies gain control of Iraq’s oil industry and reserves and much of its economy Footnote , and to steal trillions of dollars of oil profits Footnote . (not simply to get oil for the U.S. or to reduce the price of oil in the U.S.)


The amount of the profits will depend upon:


1.        The amount of oil in Iraq’s reserves.


2.        Iraq probably has more than 400 billion barrels of high-grade/high value crude oil according to the U.S. State Department.


3.        Oil, such as that in Iraq, has recently sold for as much as $147 per barrel. Considering increasing world-wide demands and dishonest speculators, the price of Iraqi oil will probably average over $100 over the next few decades


4.        Most Iraq's oil is under relatively high pressure from water and associated natural gas deposits, close to the surface and in enormous fields. This oil can be tapped with relatively few, shallow wells and very little pumping energy for less than $1.50 a barrel including all exploration, oilfield development and production costs.

With an estimated 400 billion barrels of oil in the Iraqi reserves and assuming a conservative 80% recovery rate, means that potential profits from Iraq oil could be as much as $30 trillion.

All these profits belong to and should go to the Iraqi people. Iraq does not need the oil companies capital or help. Iraq has all the development capital it needs and they can use technical support type contracts that do not require payments as a percentage of profits, or per gallon.

Iraq would happily sell to the oil companies all the oil they want at market prices; however, the oil companies would not be able to get their hands on any of these profits.

The following describes how Bush, Cheney, Bremer, et al:


1.         Took over the economy of Iraq, rewrote their laws and constitution, installed a puppet regime and managed the occupation from the White House and the “Green Zone” with U.S. personnel imbedded in most government departments, in particular, the oil ministry Footnote .


2.         Appeared to have the power to decide which oil company got which oil field.


3.        Institutionalized production sharing agreements (PSA's) which could extend for an unheard of 30 years with oil companies receiving as much as 75% of the profits with the remainder going to Iraq. These would earn massive profits for oil companies at the expense of the Iraqi people.


4.         Wrongfully and unlawfully had the laws of Iraq changed so that U.S. and other foreign oil companies would not have to pay taxes on these profits and could immediately transfer these profits out of Iraq and to their offices in countries other than the U.S., so that they would not pay U.S. taxes either. (As a matter of fact, U.S. oil companies would not even have to sell Iraqi oil to the United States and could control the price of oil by withholding Iraq oil from the U.S.)

Two things remain for U.S. oil companies to get control of Iraqi oil and the profits:

1. Convince the Iraqi Parliament to enact the new National Petroleum law. This law, which was written by U. S. government employees and contractors, could unlawfully give mainly U.S. oil companies control of at least 64 percent and as much as 87 percent of the Iraqi oil reserves Footnote . The law has been approved by the Council of Ministers and is awaiting approval by parliament. Most Iraqis and the powerful oil workers union oppose this law and any form of de-nationalization of the oil reserves.


2. Congress appropriations of taxpayers money for U.S. troops and mercenaries to provide security on the ground for the oil companies and to protect the puppet regime in the Green zone and other enclaves. Since Iraqi soldiers and policeman don’t seem willing to get killed to help Americans steal their oil, their performance is uncertain, and therefore Bush/Cheney would not agree to U.S. troop or security guard (mercenaries) withdrawals no matter how many Iraqi’s and Americans are killed and how much of Iraq is destroyed. President Obama is now doing the same

Language in H.R. 1591 - the Supplemental Spending Act, passed by the House pressured the Iraq Legislature to pass the new National Petroleum Law which would give control over 64-87% of Iraq oil reserves to U.S. and UK oil companies.