From the Univesity of Pennsylvania's Wharton School e-newletter, Knowledge@Wharton, a balanced article on the issues of oil and the post-war econony. The Post-War Future of Iraq and Its Abundant Oil Reserves http://knowledge.wharton.upenn.edu/whatshot.cfm The real dilemma is that only private companies have the wherewithal to maximize the economic potential of the oil fields, yet the dollars generated really need to stay in Iraq. Cynics believe that the it will all flow to Halliburton, and other such companies, but until I see otherwise, I believe that we will try to ensure as much of the dough as possible stays in Iraq. One model would be to hire the private companies in a "fee for service" model, with infrastructure and capital repair getting paid for on a "cost plus" basis. Meanwhile, have the nation retain 100% or a very sizable majority ownership in a state run oil company...and have that be the ONLY state run company in the economy. The rest of Iraq business would be purely private enterprise. Then, at some point in the distant future, have the state run company go completely private. Anyway, it's going to be really really tricky.
Oil well fire damage negligible: http://story.news.yahoo.com/news?tm...11/ap_on_re_mi_ea/war_worst_hasn_t_happened_3 Halliburton awarded 7 billion contract to fight oil well fires: http://www.nytimes.com/2003/04/11/b...00&en=8e3c238766503e7b&ei=5062&partner=GOOGLE
Re: Re: Oil and Post War Iraq Economy But Bill Archer said Halliburton had taken themselves out of the running for post-war contracts?!?!?!
The new regime in Iraq should demand that all DFI be done through JVs with new Iraqi companies. This would be very good politically for the US so that it doesn't look like we're sucking them dry. This will also create a new private industrial sector in Iraq. By partnering we are also giving the new companies the industrial knowledge needed to move forward. Where will the money for the Iraqi investment come from? U.S. Federal Loans of course. The guys who the Pentagon and CIA think are friendly should be in the fast track already. I don't really like the idea of state owned oil companies. Especially if the state has a leadership that's pretty much hand picked by us, it doesn't look good.
Re: Re: Oil and Post War Iraq Economy Well, the story says the contract is "worth as much as $7 billion over two years, according to a letter from the Army Corps of Engineers that was released today." What does "worth as much as" mean, actually?? That they will get paid $7 billion no matter what?? That they COULD ONLY reach the $7 billion if every single oil well was set ablaze and had to be extinguished?? Maybe they'll just get paid for the few that they put out, plus costs for getting over there, and then that's it?? The fact is that we don't know, and the article isn't very helpful in illuminating these key issues. Let's see how much they ACTUALLY get paid, not what they MIGHT get paid. Meanwhile, Congress is perfectly within it's rights to raise hell over this. Do investigate. Oh, by the way, when everyone was moaning about Cheyney and his Halliburton stock, he folded under the pressure and divested. He unloaded it near its high. I bet he thanks those Democrats every single day.
Just for the sake of discussion I'll propose another off-hand "conspiracy". I believe we may give US companies total control over the Iraqi oil reserves in order to drive the price down and put OPEC out of business. The conspiracy here is that the Administration knows that OBL and the like are funded by many of our Saudi friends from whom we currently purchase our oil (common knowledge right). By having the new Iraqi regime operate outside of OPEC and undercut Suadi prices we can put OBL's bankroll out of business, thus putting OBL out of business. All the while lowering fuel prices at home and making all the SUV driving, swing voting, soccer moms happy.