KURD OIL FOR
PROJECT BACK DOOR
It was Kurdish Oil which transformed the process of industrialisation from coal as a source of energy to oil and endeavour to use these resources to reunite Kurdistan.
Since the last century there have been many geologists - German, French and English – who have visited Kurdistan. They have found that the land has one of the biggest oil reserves in the world.
When early in the 20th century Great Britain chose oil to power the Royal Navy, the oil of Kurdistan became a subject of world strategy. Many works have been published on the subject of oil politics. Few of these books have understood the Kurdish claims, their sufferings or their point of view.
During April 1995, I attended a conference entitled: (NEW OIL: THE WORLD’S OIL MAP IN THE YEAR 2005) and the oil experts discussed the oil in Kurdistan and under the Zagros mountain which show that there are over three hundred billion barrels contained there. This is an immense reserve. It is the legitimate property of the Kurdish people ! .
The oil reserves of Kurdistan, the destruction of thousands of villages and towns in Kurdistan and the use of chemical weapons by the Iraqi regime, the uprising of the Kurdish people when they took over Kirkuk the main oil field with some support from the Allies: all these things obliged me in 1991 to go and set up an oil project under a humanitarian umbrella for re-building Kurdistan under the name of Project BACKDOOR. This was given support by the United Nations and permitted me the power to make a feasibility study on oil production in Kurdistan.
The Kurdish nation greatly welcomed the project, but it was upsetting news for the political parties who were backed by the oppressors of Kurdistan. The power of the people proved to be greater. I went ahead with the project. Mr. Anton Keller, a Swiss citizen, who wrote a letter to Barzani and Talabani and asked them to co-operate with us and to promote the political cause of the Kurdish people, assisted me but they refused to do so. This proved to be disastrous for our project.
In March 1992, I co-operated with both foreign and local engineers and succeeded to open wells in the Shewashok in Tak Tak area inside the 36th parallel, the area that is protected by the Allies. And after that with the oil I wrote the words.
The words KURD OIL in the hill nearby and set it on fire. A small sacrifice to strengthen the will of all Kurds to struggle for freedom! This greatly angered the political parties and the oppressors of Kurdistan, especially the regime in Baghdad. Since that day those forces have viewed my project as a tool to forward the cause of Kurdish Independence, and so they have opposed our cause consistently
Accordingly, those forces advanced their repression under the guise of calling an election and an apparent revival of parliamentary activity, and an independent Kurdish government. This, in the beginning made me happy and I decided to put forward my name as head and leader of that government.
When I found out that this was a selfish political gambit, I decided to withdraw my name. I left the battle to them to see whether or not what they were saying would become true or be merely so much hot air.
After the voting took place, Barzani and Talabani ignored the voters and decided to share power on a 50/50 basis. Even though this upset me greatly, I said that I would recognize this government and that I was ready to co-operate in order to rebuild Kurdistan.
They did not agree with me because their intentions were not honourable. They decided to ignore me and open three lines of communication: one with Baghdad thereby smuggling Iraqi oil and sharing the proceeds with Saddam Hussein; the other, to contact the foreign oil companies especially the ones with whom I had dealings with in order to impede my project; and the third line was to join the Iraqi opposition movement (INC), in order to confuse them on these important issues.
Der Spiegel magazine in 1998 reported that the proceeds of the smuggling of Iraqi oil into Turkey was shared between the Kurdish factions and Saddam Hussein and the Turkish mafia as follows:
84,400,000 US dollars for the Kurdish factions per year.
164,450,000 US dollars for the Turkish mafia.
300,000,000 US dollars for Saddam Hussein.
An inspector employed by the United Nations, Mr. Tim Trevan in his book Saddam’s Secrets (HarperCollins, 1999) on page 279 details the oil smuggling engaged in by the above-mentioned three factions.
This mistaken, short-sighted policy gave renewed strength to Saddam. He now had leverage within his regime, beyond his territory and especially within the groups who comprise the Kurdish nation. The foreign companies lost interest to invest in Kurdistan and they left the region.
They repeated the mistakes of earlier Kurdish leaders who opposed the Gulbenkian project to extract oil in Kurdistan. This left me no option but to fight them or withdraw for the time being, which I withdraw.
As I had knowledge of the political situation of the area I knew that the oppressors would cause trouble for the Allies and to try eject them from the area. Thus I decided to withdraw and leave the political parties to fight amongst themselves. This they did with the result that 20,000 Kurds were killed, 50,000 were injured and half a million Kurds found themselves homeless and so they went to Europe seeking political asylum.
We as a new generation cannot accept the continuance of the above mistakes. At the dawn of the new millennium we stand in the shadow of our mountains and welcome the world to our Great Kurdistan.
JEFFREY ARCHER'S EFFORTS TO TAKEOVER
MY OIL PROJECT
Please take note:
I have no anti-conservative party agenda as I hold similar political principles but Jeffery Archer has damaged the party.
Archer formed links with the oil project in Kurdistan.
When I heard about his reputation as a writer, and that he was spearheading a concert at Wembley (1991) designed to raise money to stop the plight of the Kurdish people, I naturally assumed that he would be the person to contact with regard to joining people like myself in bringing about an end to the suffering.
The concert was held and the sum of 57 million pounds was raised. I, like many others, was interested in knowing how this money was going to be distributed.
Lord Ennals, a true friend to the Kurds and not a seeker of personal gain, was one of the supporters of my project. As this was a humanitarian project he fully understood my intentions, because the nature of his work was very similar.
At the beginning of the programme, I visited Lord Ennals in order to seek guidance as to the best way to proceed, either through the route of the oil companies or through the use of funds, which had been specifically donated for humanitarian purposes.
Lord Ennals advised me that the best way forward was to contact Jeffrey Archer and ask him to give the sum of between 10 - 20 million pounds in order to see the project underway.
Lord Ennals and I went to Jeffrey
I began to feel a sense of extreme unease. He then informed me that all 57 million pounds had been distributed and that therefore the best way forward would be for me to contact the Overseas Development Agency. Evidence in support of the above can be found later on in this section. For example, a letter from Lord Ennals to the O.D.A. expressing his has had talks with Jeffrey Archer and also focusing on his interest in the plight of the Kurds.
Jeffrey Archer also asked me to support Muhsen Dizaie in his quest to become a Kurdish leader. However, Dizaie was a person who had never known or experienced the atrocities of war and suffering and so would be totally unsuited as a leader of people who had been through so many afflictions.
Also he was one of the Iraqi ministers
who supported the nationalisation of oil.
His son had collected 2 million pounds from British banks - this money had
supposedly been to re house the Kurdish refugee in
Jeffrey Archer thought that Dizaie was a popular figure among the Kurdish people. He knew nothing about Dizaie's past reputation - for example that he was Barzani's account-holder and one of the so-called leaders who did not have the interests of the Kurdish people at heart, instead he preferred to spend his time with the aggressors.
I asked Jeffrey Archer how the 57 million pounds had been distributed and spent. I asked to see documentary evidence. He told me to ask Dizaie for evidence.
Lord Ennals and I had been on a fruitless journey.
I continued my contacting of foreign
investors, and one of them is the Occidental Oil Company who showed interest in
the project and informed his London-based
When we went to Kurdistan we met with Barzani, who was Dizaie's political leader, and he declared his support for our programme. Dizaie approached Barzani and asked for information regarding the company who had expressed an interest in a Kurdish oil development programme. Before our return from Kurdistan Dizaie gave this information to Jeffrey Archer, who in turn declared that he had contacts in that company named Henry.
Jeffrey Archer contacted this person,
Henry, and told him to completely disregard Sardar Pishdare because he (Archer)
could bring all the Kurdish leaders to his house for talks and he could also
gain the support of the British government. When I returned from
I explained that I had asked him for help with my project, but that he had been unable to do anything. They informed me that they needed time to assess the situation. During the weeks that followed, Dizaie and some self-styled Kurds met with Jeffrey Archer and called a conference at Archer's house.
Henry and his colleagues from the
Occidental were present. I cannot understand why I was not invited to attend.
Archer promised to bring both American and British support if Occidental were
prepared to deal with his company, which he had registered, in
I knew of Archer's activities but I still contacted him and once more asked for help. He stated that he was a writer and was not involved with any business enterprises. Archer held an interview with a Kurdish newspaper, which is printed monthly - Hangaw - (June & July 1994). He stated that he was working towards the opening of the oil wells in Kurdistan.
During the time when Archer was setting up a company in Panama in order to avoid paying British taxes, I had already registered the Kurd Oil Company in London.
If Archer wanted to help the Kurdish people and act in a humanitarian way, why did he act in this way and completely disregard me when he knew that I had the papers from the United Nations, and also that I was one of the victims of Saddam's war?
Despite his efforts to take over my project, I did not contact the media or any other sources and reveal his ambitions. This was because I did not want to further harm the people for whom this project was originally intended. I do not intend to ruin Archer, but I feel that I must be given an opportunity to put the record straight.
THE INVOLVEMENT OF Zalmay Khalilzad and Gen. Jay Garner to teak over my OIL PROJECT
In early 2003, Mr. Zalmay Khalilzada led a conference in London for the Iraqi opposition to remove Saddam with support of the US and British government. I rejected program from the outset, and informed my Americian contact (P.W) that the groups and individuals involved were not capable of turning Iraq in to a new democratic Iraq, as they had either strong ties with Syria or Iran.
It was Mr. Zalmay Khalilzada who helped to organize the opposition and was subsequently appointed as the USA Ambassador in Iraq. With his influence in the Iraqi opposition and USA government apparent, both Barzani and Talabani managed to make him a key player with a vested interest in Kurdish oil to stand against my projects.
I have shown in the following pages details of Mr. Zalmay Khalilzada and his US associates involvement in the Kurdish oil scandal.
It was Mr. Zalmay Khalilzada who guided other significant US officials in Iraq towards actively having a secret personal vested interest in the Kurdish oil. They include General Jay Garner the former provisional Head of American run government in Iraq and Peter Galbraith a key US diplomat in the Middle East.
This has tarnished many US officials, as it now appears that the decisions and policy were determined by their vested interests in Kurdish Oil. The owners of Kurdish oil are the oil smugglers who don’t have to declare revenue yet have strong relationships with former US officials who people deemed to be their protectors.
Following the deaths of over 6000 US military service men and women and over $700 billion spent on the war, the net result is enriching members of the Iraqi opposition and more distain for the US in the region become a millioner and Billioner.
Ex-U.S. Ambassador to
This is the
latest and highest-profile development in the former
Khalilzad, who is based in
Prior to being
named to DNO's board, he spoke with Iraq Oil Report in his
What is your take on post-election, pre-government-formation
Zalmay Khalilzad: I think this election was a success. A positive step, a positive evolution in Iraqi politics. The level of violence was low. The level of participation was acceptable and the Iraqis voted in a less sectarian manner than in the previous election. The two leading parties, one is clearly a secular, non-sectarian, cross-sectarian party of Ayad Allawi that did very well. At the same time Prime Minister Maliki's party (Dawlat Al-Qanoon) also presented itself as non-sectarian, cross-sectarian and it did very well as well. Of course still most Shia voted for Shia parties and most Sunnis voted for Iraqiya, but nevertheless it shows evolution in the attitudes of the people.
BL: You were
ambassador in Iraq during a quite violent time, when there was a lot of
animosity between Shia and Sunni in
ZK: You cannot rule it out. It's possible it could be reignited. It could happen in two ways. One is if there is contestation of the election results, and if takes a very long time to form a government and during this period violence increases. Or if terrorists are able to carry out operations, spectacular operations, that could once again increase insecurity. Also, violence could increase if a narrowly based and sectarian government is formed.
I think one
reason for the positive change was there was a greater sense of security and
people were tired of the sectarian conflict that had taken place. But my sense
is unlikely to go back to the bad old days of 2006 and 2007 after the attack on
BL: One area of
friction in the country is not religious-based but ethnic-based. And I'm
referring to the ongoing stalemate between
ZK: There are
many issues affecting Kurdish relations with the rest of
BL: What issues have been discussed as being left for later and what issues need to be addressed right away?
ZK: The question is whether the territorial issues are going to be the ones to come to an agreement on first, or do you get a roadmap to deal with the territorial issues, based on the constitution, and then you make some progress in regard to the oil and energy issues?
BL: You view those as the top two issues, territorial and resources issues?
ZK: Those are the top two issues. The Kurdish issue is also a lot more complex than it was. First they're numerically a smaller percentage of the coming parliament than they were of the previous parliament but nevertheless their presence will be significant. Also they are more divided than they were in the previous parliament because now we have got (the new political party) Goran also as a player.
BL: One thing
ZK: There's quite a large number of opportunities in
with very substantial potential are telecommunications, banking and insurance,
the service areas, the enablers of much else that happens in the economy. The
issue of opening additional cell phone competition is very important. And
developing the infrastructure in some areas is offering opportunities. Then
you're talking about housing. In the election both leading parties talked about
2 million new housing units to be built in the foreseeable future. There are
vast potential for companies from abroad to invest. There is also other
infrastructure from roads to railways, whether up north or the rest of
The whole area
of continuing to build up Iraqi security forces to be able to do what they need
to do for themselves. It used to be
that a lot of the work was done through the
So there is a huge potential in Iraq's economic future whose development is likely to be the key focus of the next government, it's likely to have a big impact not only on Iraq but a big market a big opportunity for outsiders.
BL: Where have you found the most opportunities for your clients or for yourself?
ZK: We have
about a dozen clients interested in
BL: As you
mentioned, a big thing is further developing their massive oil and gas reserves
which can not only help feed the basic services of the country but also bring
in a lot of revenue. Where are you seeing your clients are they invested in, up
north or the rest of
ZK: The whole
BL: Are these American clients?
ZK: I have American clients, but we also have non-American clients as well; but most of my clients are American clients.
BL: And in the oil or energy sectors?
ZK: It includes the energy sector but not exclusive to the energy sector.
BL: What deals have you reached?
ZK: We have had, we are in the process of discussions with Iraqis and these firms. There have been some progress made but I'm not in a position for reasons of confidentiality of it to say which ones we were involved in.
BL: Is this with the KRG?
ZK: No, with
BL: There have been no deals on energy issues with the KRG?
ZK: On energy issues, no, not with the KRG.
BL: I noticed that I was seeing pictures from announcements from the KRG from two events last year, one was when they started exporting the oil and one was when they opened the refinery, and you were there in the front row of both pictures.
ZK: Well, I
have good friends in
BL: It is an
important distinction then for people who follow
ZK: The government was a single government, both PUK and KDP were part of it. I don't think that there was an issue. I have a good relationship with many Iraqi leaders, knowing them when they were in the opposition, ‘til now, and that’s why they've honored me with invitations to some of their events. Success events, as they see it.
BL: These two
events specifically, before I even heard that you were there,
I remember thinking that these were quite potentially controversial events and
it turns out they were. And some people said that it was a little confusing for
the former Ambassador to be at such controversial events and that it could add
to some confusion in negations between the KRG and
ZK: I have not
found it that way. I do not believe those projects were controversial in
THE INVOLVEMENT OF Gen. Jay Garner
To teak over My OIL PROJECT
If Squitieri’s ties to the Kurds were forged during his reporting assignments, he would join a growing coterie of Americans who are benefitting financially from their past associations with the Iraqi Kurds.
A group of
Gen. Jay Garner (Ret.) has become an ardent supporter
of the Kurds in the
officials have tried to leverage their connections, too. In 2008, Ray Hunt, head
of Hunt Oil and a personal friend of President George W. Bush, signed an
exploration deal with the KRG. Later that year the Wall Street Journal revealed that Bush
and Garner—who briefly served as the head of the CPA in 2003—are among the most
When reached by phone and asked about Squitieri, Garner said that he remembered meeting him at a KRG function “about a year ago” and had “no idea” how he came to work for Talabani.
Galbraith, who remains locked in a legal dispute with a Norwegian oil company over his Kurdish oil interests, did not respond to telephone and email requests for an interview.
Trento’s Take: The Other Other Iraq
By Joseph Trento, on June 15th, 2011
The Kurds call themselves the other Iraq. They even have an advertising campaign:
Have you seen the Other Iraq?
Fewer than two hundred US troops are stationed here.
Arabs, Kurds and Westerners all vacation together.
What this Kurdish PR campaign omits is that the hospitable Kurds hire the U.S. generals and diplomats who helped them – the former U.S. government officials who made the other Iraq possible.
I bet you didn’t know there is another other Kurdish Iraq. It’s based in Washington, D.C., in a beautiful, revamped multi-million dollar building. It uses a plagiarist as its spokesperson. It hires former military generals who commanded U.S. troops and rewards former diplomats with oil deals. It maintains several homes in the Washington area and runs up Newt-Gingrich-sized jewelry store accounts. It gives away $25,000 watches for gifts.
The equivalent of Mario Puzo’s The Godfather is playing out in the Kurdish region of Iraq. Its two main political families grow wealthier by the day on the oil riches. They build huge mansions back home with large staffs and private jets. They own radio and television stations and control the media. The Talabani and Barzani families have made a temporary peace as they divide up the riches of power and use former American generals and diplomats to tend to the details of keeping Washington happy enough so the Kurdish gravy train does not run off the tracks. That makes our generals and diplomats working for these two political gangs the equivalent of the corrupt New York police official who Michael Corleone dispatches in the novel.
The two main Kurdish political parties have friendly former U.S. general officers, starting with Jake Garner, on their payroll to do their bidding in Washington. They are the best ex-generals (and a few diplomats) that money can buy.
The generals who sent our young soldiers to war in Iraq are cashing in by serving the interests of families who are fundamentally refusing to share Iraq’s oil wealth which is leading to more conflict and death. It is a mindlessly corrupt former U.S. general officer corps that will do anything for cash and a business class ticket.
And now there is trouble back home. The wealth is not being shared beyond these two political families. The gleaming new business hubs of Kurdistan offer little to those who are not members of the clans. The people who are not affiliated with either clan are protesting the mansions and brazen corruption that is the new Kurdistan, increasingly with violence.
When things get out of hand, the Kurdish leaders call in the vaunted peshmergas to take care of the troublemakers. Protests, after all, are bad for business, and business is booming in Kurdistan.
There is no democracy, only corruption. One Kurdish candidate says, “Money is everything on the ground. They buy votes. It’s the only reason they are in power. …No banks. Envelopes. If you are not with the Kurdish party, you have nothing. There are no government books. No accounting. It’s a cash society.”
Most average Kurds do not get to live in huge mansions or stay in luxury hotels made possible by American blood and tax money and our pliable former military officers and fast buck ex-diplomats.
Iraqi President Talabani’s slipping of cash to wounded warriors during visits at Walter Reed is an image of a man who had the most to profit from U.S. intervention handing out tips to American soldiers who sacrificed body parts to make his oil empire possible.
We at the National Security News Service helped unearth the scandal that became David Barstow’s Pentagon consultants’ story a few years ago. We know a great deal about American general officers who peddle their reputations to sell wars and military hardware. These guys are nothing more than mercenaries who wrap themselves in the flag and get wealthy on the backs of the men and woman they once commanded.
The photographs of our very best generals and diplomats rushing to the Kurdish faction to cash in make this tawdry tail even uglier. General officers get a decent pension. They get medical care and PX privileges.
How much money is enough? When does going on the payroll of Kurdish political bosses or others profiting from the wars become conduct unbecoming?
Joseph Trento has spent more than 35 years as an investigative journalist, working with both print and broadcast outlets and writing extensively. Before joining the National Security News Service in 1991, Trento worked for CNN's Special Assignment Unit, the Wilmington News Journal, and prominent journalist Jack Anderson. Trento has received six Pulitzer nominations and is the author of five books, including Prelude to Terror, The Secret History of the CIA, Widows, and Prescription for Disaster. Joe currently serves as the editor of DCBureau.org
U.S. Adviser to Kurds Stands to Reap Oil
By JAMES GLANZ and WALTER GIBBS
Published: November 11, 2009
OSLO — Peter W. Galbraith, an influential former American ambassador, is a powerful voice on Iraq who helped shape the views of policy makers like Joseph R. Biden Jr. and John Kerry. In the summer of 2005, he was also an adviser to the Kurdish regional government as Iraq wrote its Constitution — tough and sensitive talks not least because of issues like how Iraq would divide its vast oil wealth.
Now Mr. Galbraith, 58, son of the renowned economist John Kenneth Galbraith, stands to earn perhaps a hundred million or more dollars as a result of his closeness to the Kurds, his relations with a Norwegian oil company and constitutional provisions he helped the Kurds extract.
In the constitutional negotiations, he helped the Kurds ram through provisions that gave their region — rather than the central Baghdad government — sole authority over many of their internal affairs, including clauses that he maintains will give the Kurds virtually complete control over all new oil finds on their territory.
Mr. Galbraith, widely viewed in Washington as a smart and bold foreign policy expert, has always described himself as an unpaid adviser to the Kurds, although he has spoken in general terms about having business interests in Kurdistan, as the north of Iraq is known.
So it came as a shock to many last month when a group of Norwegian investigative journalists at the newspaper Dagens Naeringsliv began publishing documents linking Mr. Galbraith to a specific Norwegian oil company with major contracts in Iraq.
Interviews by The New York Times with more than a dozen current and former government and business officials in Norway, France, Iraq, the United States and elsewhere, along with legal records and other documents, reveal in considerable detail that he received rights to an enormous stake in at least one of Kurdistan’s oil fields in the spring of 2004.
As it turns out, Mr. Galbraith received the rights after he helped negotiate a potentially lucrative contract that allowed the Norwegian oil company DNO to drill for oil in the promising Dohuk region of Kurdistan, the interviews and documents show.
He says his actions were proper because he was at the time a private citizen deeply involved in Kurdish causes, both in business and policy.
When drillers struck oil in a rich new field called Tawke in December 2005, no one but a handful of government and business officials and members of Mr. Galbraith’s inner circle knew that the constitutional provisions he had pushed through only months earlier could enrich him so handsomely.
As the scope of Mr. Galbraith’s financial interests in Kurdistan become clear, they have the potential to inflame some of Iraqis’ deepest fears, including conspiracy theories that the true reason for the American invasion of their country was to take its oil. It may not help that outside Kurdistan, Mr. Galbraith’s influential view that Iraq should be broken up along ethnic lines is considered offensive to many Iraqis’ nationalism. Mr. Biden and Mr. Kerry, who have been influenced by Mr. Galbraith’s thinking but do not advocate such a partitioning of the country, were not aware of Mr. Galbraith’s oil dealings in Iraq, aides to both politicians say.
Some officials say that his financial ties could raise serious questions about the integrity of the constitutional negotiations themselves. “The idea that an oil company was participating in the drafting of the Iraqi Constitution leaves me speechless,” said Feisal Amin al-Istrabadi, a principal drafter of the law that governed Iraq after the United States ceded control to an Iraqi government on June 28, 2004.
In effect, he said, the company “has a representative in the room, drafting.”
DNO’s chief executive, Helge Eide, confirmed that Mr. Galbraith helped negotiate the Tawke deal and advised the company during 2005. But Mr. Eide said that Mr. Galbraith acted solely as a political adviser and that the company never discussed the Constitution negotiations with him. “We certainly never did give any input, language or suggestions on the Constitution,” Mr. Eide said.
When the findings based on interviews by The Times and other research were presented to Mr. Galbraith last weekend, he responded in writing to The Times, confirming that he did work as a mediator between DNO and the Kurdish government until the oil contract was signed in the spring of 2004, and saying that he maintained an “ongoing business relationship” with the company throughout the constitutional negotiations in 2005 and later.
Mr. Galbraith says he held no official position in the United States or Iraq during this entire period and acted purely as a private citizen. He maintains that his largely undeclared dual role was entirely proper. He says that he was simply advocating positions that the Kurds had documented before his relationship with DNO even began.
“What is true is that I undertook business activities that were entirely consistent with my long-held policy views,” Mr. Galbraith said in his response. “I believe my work with DNO (and other companies) helped create the Kurdistan oil industry which helps provide Kurdistan an economic base for the autonomy its people almost unanimously desire.”
“So, while I may have had interests, I see no conflict,” Mr. Galbraith said.
Kurdish officials said that they were informed of Mr. Galbraith’s work for DNO and that they still considered him a friend and advocate. Mr. Galbraith said that during his work on the Constitution negotiations, the Kurds “did not pay me and they knew I was being paid by DNO.”
Mr. Istrabadi, who was also the Iraqi ambassador to the United Nations from 2004 to 2007, said the case was especially troubling given the influence of Mr. Galbraith’s policy views. In his writings — some of them on the Op-Ed page of The Times and in the New York Review of Books — he is generally identified as a former ambassador or with some other generic description that gives no insight into his business interests in the area.
Mr. Galbraith, for many years on the staff of the Senate Foreign Relations Committee, has a long relationship with the Kurds. In 1988, he documented Saddam Hussein’s systematic campaign against the Kurds, including the use of gas. He served as United States ambassador to Croatia between 1993 and 1998. In September, he was fired as the No. 2 official with the United Nations mission in Afghanistan after he accused the head of the mission of concealing allegations of electoral fraud.
Views of Mr. Galbraith’s business ties are harsh within the central Baghdad government, which has long maintained, in stark opposition to Mr. Galbraith’s interpretation of the Constitution, that all the oil contracts signed by the Kurdish government were illegal.
Referring to the Constitution negotiations, Abdul-Hadi al-Hassani, vice chairman of the oil and gas committee in the Iraqi Parliament, said that Mr. Galbraith’s “interference was not justified, illegal and not right, particularly because he is involved in a company where his financial interests have been merged with the political interest.”
Citing what he said were confidentiality agreements, Mr. Galbraith refused to give details of his financial arrangement with the company, and the precise nature of his compensation remains unknown. But several officials, including Mr. Galbraith’s business partner in the deal, the Norwegian businessman Endre Rosjo, said that in addition to whatever consulting fees the company paid, he and Mr. Galbraith were together granted rights to 10 percent of the large Tawke field and possibly others.
An internal DNO document dated Dec. 3, 2006, which was first obtained by Dagens Naeringsliv, indicates that a company called Porcupine, registered in Delaware under Mr. Galbraith’s name, still held the rights to the 5 percent stake at that time, while a company associated with Mr. Rosjo held the other 5 percent.
Mr. Eide, the DNO executive, said that as far as the company knew, Mr. Galbraith’s work was proper.
“To our knowledge, Mr. Galbraith in 2004 was working as a businessman with no political assignments,” Mr. Eide said. “Given our network model and limited experience and knowledge from the region at that time, our evaluation concluded that we should use Mr. Galbraith to advise DNO in the first stage of the project.”
As revelations began appearing in recent weeks, Mr. Galbraith at first issued qualified denials stating that he had never been party to any arrangement in Iraq technically referred to in the oil industry as a production-sharing contract. But industry insiders say that the rights could have been couched in different terms — not an ownership stake, but a conditional right or option to become part of such an agreement at a future date.
Estimating the value of any stake in the Kurdish fields is difficult given the political uncertainties. But Are Martin Berntzen, an oil analyst at Oslo’s First Securities brokerage, said the Tawke field alone has proven reserves of about 230 million barrels, a figure likely to increase as new wells are drilled.
“Given no political risk, a 5 percent stake should be worth at least $115 million,” he said, though he emphasized that he knew nothing about Mr. Galbraith’s arrangement.
A possible indication of Mr. Galbraith’s estimate of the deal’s worth may be discerned in a London arbitration case in which Porcupine and a Yemeni investor who now apparently holds Mr. Rosjo’s former share are seeking more than $525 million from DNO, according to a filing reported on the legal news Web site Law.com. Oil analysts in Norway played down the likelihood of a reward as large as the claim.
According to DNO, the claim represents up to 10 percent of the value of the regional production contract, which the Norwegian oil firm now shares with a Turkish energy company after Kurdish authorities reviewed the previous deal and barred “certain third-party interests” from participating further. At a shareholders meeting on Wednesday, Mr. Eide refused to name Mr. Galbraith as a claimant in the case. He acknowledged, however, that DNO lost a procedural ruling in the case last May, and he said a final decision on damages was expected in early 2010.
In his response, Mr. Galbraith would say only that “my contractual relationship was with DNO and is the subject of pending arbitration.”
Mohammed Hussein contributed reporting from Baghdad, and David E. Sanger from Washington.
IRAQ IS SMUGGLING OIL TO THE TURKS UNDER GAZE OF U.S.
By JAMES RISEN, Published: June 19, 1998
The Middil East Report:
(Raad Alkadiri is senior country risk analyst for the Petroleum Finance Company. The views expressed here are his own.)
linked to Masoud Barzani's Kurdish Democratic Party
(KDP) allegedly benefit financially from a deal with Baghdad that ensures the
secure movement of contraband oil products to Turkey. Companies linked to the
KDP are also suspected of receiving legitimate contracts to lift Iraqi oil
under the Oil-for-Food program, as a result of the leadership's smuggling
Michael Rubin is a resident scholar at AEI.
Thursday, July 14, 2011
the Iraqi Kurdish leadership is more consumed with self-enrichment. Following Iraq's defeat in 1991
of corruption goes beyond money. An embezzlement scandal sparked the 1994-97
Kurdish civil war between Barzani and his rival,
Patriotic Union of Kurdistan leader
The danger is in disillusionment. Iraqi Kurds, stifled by the corruption of their leaders, are supporting Islamist parties.