Oil Prospecting Hurts Democratization

April 19, 2006

Dear President Bush,

I wrote to you two weeks ago pondering the role of oil in un-greasing the wheels of democracy in Iraq. May question to you was “what role is the squabbling over oil having on the snail’s pace movement towards fashioning a democratic government in Iraq?”

The answer appears to be a major role, according to the LA Times.

Leaders of Iraq's Kurdish north have unveiled a controversial plan to consolidate their hold on the region's future petroleum resources, raising concerns about how the ethnically divided nation will share its oil revenue.

The Kurdish parliament will be asked to vote on the creation of a Ministry of Natural Resources that would regulate potentially lucrative energy projects in newly discovered oil and natural gas fields within the three provinces of Iraqi Kurdistan.

The new ministry, if established, would be another step in the Kurds' gradual retreat from the Baghdad government, as well as a potentially destabilizing development in a country already on the verge of fragmenting along ethnic and religious lines."They have the right to make a decision in their territory, but it is dangerous," said Mohammed Aboudi, a divisional director-general of the national Oil Ministry and a government advisor. "They are starting to search for oil without any consultation with the central government. What if Basra does the same, or any other province?"

Interim Oil Minister Ibrahim Bahr Uloum, advised of the proposal, warned against unilateral decisions on oil."At the end of the day, it's important to have coordination and communication, especially with oil, because it's a very sensitive issue," Bahr Uloum told the Los Angeles Times.

Officials in Baghdad, including allies of the Kurds, said they were blindsided by news of the proposed ministry. "We know what the ambitions of the Kurds are," said Iyad Samarrai, a leader of the Iraqi Islamic Party, a Sunni Arab group. "But everybody agreed to make such moves within the [national] political process."

The Kurds are being advised by an ex-U.S. diplomat, Peter Galbraith. He said:

"Forming a new ministry is an arrangement that will help increase oil production. If oil production increases in Alaska, it may be that the Alaskans get a major part of the benefits, but Alaska is still part of the U.S."

Funny how Mr. Galbraith mentions Alaska as you passed on setting up an oil profits fund that would benefit all Iraqi citizens, just as the state of Alaska did decades ago. Had such a fund been established would oil be greasing the democratic process, instead of throwing monkey wrenches into its gears?