Monday, August 29, 2016


Hi Everyone,
Now that Amnesty law is passed and aggressively being implemented, we will now want to move our attention to the next big obstacle to our long awaited RV, that of the oil and gas law (HCL). This law  has been kicking the can down the road since 2008. If you research you will see just why this is the case. However this can not go on much longer since the survival of Iraq depends on nailing down just how the drilling, transporting, selling and revenue sharing will be handled. With ISIS stealing oil and all the recent mismanagement with the contractor payments they need an HCL more than ever.

If you truly take the time to study the 2008 draft oil and gas law you will see just why it has been delayed for so long and why it now has to go forward. Iraq has never had a better opportunity to move on this law and do it now. There is still some little hesitation since many in the finance ministry and parliament do not want to now distribute revenues for the oil revenue sharing due to the cost of fighting ISIS in the north. This is one other obstacle and now they also are talking about supporting a reduction in oil generation to raise the prices. This will of course have to be support by all of the GCC and not just Iraq alone. But the important part for us is this could cause yet more delays in the HCL law as they try to figure out what they are going to do. Will it impact the passing of HCL? I do not think so. But this is my personal opinion.

So in today’s news letter let’s read up a bit on the HCL and educate ourselves so we don’t get tricked by these charlatans once again selling us their every day / any day RV stuff. If we stay educated we are in control of our own news. There are a ton of very good articles on the web these days. Just make sure they are not opinion from some intel guru and factual news.

No need for Rumors, No Hype, just the FACTS.
The Iraq Hydrocarbon Law: How and When?
Published:  June 1, 2007
By: Christina Parajon

The much-discussed and often delayed Iraqi hydrocarbon law, approved by the Iraqi cabinet in February, is a bellwether for the future of the Iraqi state. Successful passage and implementation of the law would reflect a strong spirit of compromise and help to calm violence. If, on the other hand, the proposed law fails to pass, it will have negative repercussions for Iraq’s social, economic and political stability.

The much-discussed and often delayed Iraqi hydrocarbon law, approved by the Iraqi cabinet in February, is a bellwether for the future of the Iraqi state. Successful passage and implementation of the law would reflect a strong spirit of compromise and help to calm violence. If, on the other hand, the proposed law fails to pass, it will have negative repercussions for Iraq’s social, economic and political stability.

To consider outstanding issues concerning the law, the U.S. Institute of Peace held a public event on May 18, 2007 featuring Revenue Watch Middle East Director Yahia Said. Said recently returned from several months in Iraq working on the International Compact with the UN. USIP Vice President for Post-Conflict Peace and Stability Operations Daniel Serwer moderated the event. This USIPeace Briefing summarizes the discussion and does not represent the views of the Institute, which does not take positions on policy issues.

The Hydrocarbon Law So Far: More than Oil, but Still Less than Everything
Yahia Said underlined the contentious climate surrounding discussion of the hydrocarbon law, which has more to do with the overall political situation than with the law’s specific content. It has become a political battleground between those who want a more unified Iraq and those who want a looser, more decentralized federation. Many Iraqi citizens look to the law for what it can contribute to reconciliation, security, and welfare, but the political leaders see it as a test of who will govern in the future and how.

The portion of the hydrocarbon law approved by the cabinet in February concerns managing hydrocarbon investment, in particular how the upstream part of the industry will be developed. It is only one part of what will eventually be a four-part agreement. The three other parts of the agreement will deal with the issues of
1) revenue sharing;
2) restructuring of the ministry of oil; and
3) establishing the Iraqi National Oil Company (INOC).

The separation of revenue matters from management of the oil sector is vital, but there has to be agreement on the other matters—the sharing of revenue, the oil ministry (which is relatively non-controversial) and INOC (including the specific fields within its remit)—before the legislation can be submitted to the Council of Representatives (the Iraqi parliament).

Power Sharing: The Balance Tilts Toward the Central Government...
The controversial issues in the law concern how power will be divided, first between the central government and regions (or governorates), and secondly between the public sector and the private sector.

The law starts with an article of the Iraqi constitution which declares that "the Oil and Gas are owned by all the people of Iraq in all the Regions and Governorates." The current draft treats oil as a united national patrimony, with the Council of Ministers as the supreme oversight body, the ministry of oil as the policy-setting body and the Iraq National Oil Company and its regional subsidiaries as the operating entities. The Federal Oil and Gas Council will be responsible for carrying out the Council of Ministers’ duties in overseeing the sector.

This suggests a degree of recentralization of control over oil, an important concession by the Kurdistan Regional Government (KRG), which had previously insisted that Kurdistan’s oil belonged to the people of Kurdistan, that "new" oil fields should be managed exclusively by the KRG, and that the private sector—including international oil companies—should play a major role. The ministry of oil argued for a prominent role for the state sector and the government in Baghdad. Compromise on the oil law was made possible by the promise of an ironclad system for revenue sharing, an agreement that has not yet been approved even in the cabinet.

The KRG has lingering doubts. Its objective is still to maximize KRG control and to maximize private sector (including foreign) investment. Some of the drafters and negotiators for the federal government are concerned that ambiguities and cumbersome institutional underpinnings of the law may lead to decentralization by stealth and open the way for inefficiency and abuse.

When the law goes to Parliament for official approval, it could be amended in ways that Kurdistan MPs would find difficult to block. That could undermine the revenue-sharing and other parts of the agreement as well.

...and Away from the Internationals
While the law makes room for foreign investors, it has not done so to the detriment of national interests, as many press reports have asserted. Fear that the law gives free reign to multi-national companies is unfounded, Said argued. Frankly speaking, "the aim of this law from beginning was to promote foreign investment in Iraq’s oil sector. Yet while the law opens the door for foreign companies, there are careful, deliberate mechanisms in place to maintain control in the hands of national government."

The drafters, who were all Iraqis but worked in English, paid heed to the balance between the need for investment and expertise from abroad and the requirement for national control over revenue and exploration. The national oil company is given control of over 90 percent of known reserves in the law’s annexes, which allocate fields between INOC, the ministry and the regions. The law mandates that all contracts made with foreign companies contain language that ensures national control, maximizes national economic return, and ensures through various conditions Iraqi sovereign control and interest.

Said believes that a more plausible concern is that the restrictions placed on multi-nationals, combined with national and regional insecurity, would discourage foreign investment. There is even a question of whether the wording of law allows companies to book reserves. Said concluded on this point that "in terms of spirit, intent, and language it is a law that is informed by the national interest."

Transparency is Important
Will the state have the technical capacity to exercise the degree of technical regulation and development required in the new law?

Said believes that the Iraqi state’s lack of technical capacity is a real issue, but will not present problems for implementing the law’s strong provisions on transparency. He feels that the law is the "strongest [oil law] on transparency in the region." It requires the publication of all contracts, all commercial data related to the industry, output figures, taxes, royalties, and so on. Optimistic on this front, Said stated that "the beauty of transparency is that it is one thing you can do to shore up accountability without huge associated demands of technical capacity."

There is Still a Long Road Ahead...
There is still a long road ahead before passage of the Iraq hydrocarbon law. The draft put forth in February cannot go to parliament on its own—it must go as one piece of the four-part package. The other three parts are in various stages of development, with the revenue-sharing component being the most contentious.

While parliament has shown willingness to take the oil law’s passage seriously, it is not willing to be pushed around by the international community or those who wish to see quick passage. Members of Parliament understand the necessity and gravity of the issues, but they also understand their constitutional right to examine the document carefully. Some feel that there are other issues more urgent than an oil law. The majority argue that the law can and must be part of the solution to Iraq’s broader instability and is an essential part of the way forward, but only after thorough discussion.

The most important element still pending is the revenue-sharing scheme. Fearing mistreatment at the hands of the central government, the KRG insists it should receive its share automatically from a special agency that would parcel out oil revenues according to a pre-agreed formula.
Said commented that the solution to some concerns of the Kurdish and other groups might lie outside the hydrocarbon law. The constitution allows for, but does not create, a second chamber of parliament, a Federation Council, which is the more appropriate venue for protecting minority interests. The absence of this Council poisons many debates and creates many legislative ambiguities in Iraq today. The Council is being replicated in miniature in the Federal Oil and Gas Council, the Electoral Commission, and any eventual agency which will oversee revenue distribution. This blurs the boundaries between the legislative and the executive, reduces efficiency, and reduces the accountability of government.

...and Progress is Important

Undoubtedly, the February draft law represents a rare moment in which political elites were able to achieve a reasonable compromise. That said, the compromise is fragile and might be destroyed by the “noise” surrounding the process. Moreover, important pieces of the legislative package remain still to be concluded. While it is vital that the oil package move forward, so that Iraqis (and Americans) can see tangible progress toward reconciliation, stabilization, and reconstruction, it is also important that the Iraqis own the process. It would be a serious mistake for Washington to abbreviate the process, just as it would be a serious mistake for Baghdad to allow it to drag on too long. Either unrealistic expectations of early legislative action or unrealistic prolongation of the process could vitiate the political benefits of the legislation.

U.S. Congratulates Iraq on Hydrocarbon AgreementPress Statement
Marie Harf
Deputy Department SpokespersonOffice of the Spokesperson
Washington, DC
December 2, 2014

We congratulate the Iraqi and Kurdistan Regional Governments on reaching a broad agreement on revenue management and oil exports originating from the Iraq Kurdistan Region and Kirkuk. This resolution, in line with its constitution, allows all Iraqis to benefit equitably from Iraq’s hydrocarbon sector. This agreement will further strengthen both Iraq’s Federal Government and the Kurdistan Regional Government as they work together to defeat ISIL.

So it looked like in 2014 that the draft HCL was finalized but only a daft law in the Kurdistan region. The federal government in Baghdad must also buy into it since all revenues are to go through Baghdad. See above article. But remember all laws must then go through parliament also and be “passed’ to become law. Backroom deals just don’t do it. Sorry all you so called intel “gurus” out there saying this law is done. The show is not over until the fat lady sings….lol…lol…

So just what is the latest news on HCL? See below article.
Legal representative: Parliament is determined to approve oil and gas law
Aug 27, 2016
{Baghdad: Euphrates News} The member of the legal committee in Parliament MP for the coalition of Kurdish blocs Amin Bakr, the intention of parliament to approve a draft oil and gas law in the coming period.

Said Baker, told {Euphrates News}, that "we have a package of laws , including the Justice and Accountability and financial laws exempting companies from taxes and oil and gas law," he said . "There 's determination to approval."

And the legislation of the amnesty law, he pointed out that " the vote on amnesty year, it is a major achievement , "adding that" the subject of amnesty became politically because some parties complain of being politically targeted."  promised legislation amnesty law" a step towards national reconciliation. "
the House of Representatives voted last Thursday, to approve the amnesty bill year.
It is said that several laws approved in parliament crashes since the previous sessions and the most important of the National Guard and the oil and gas of the Federal Court Rules and other trace differences that revolve around by the political blocs.

A possible deal to freeze oil production in order to raise prices

Iraqi Oil Minister Ali Jabbar Luaibi said Saturday that Iraq was ready to play an active role within OPEC to support oil prices without explaining that Baghdad was ready to support a possible deal to freeze production in order to raise prices.
Assem Jihad, spokesman for the ministry quoted the minister as saying the oil city of Basra, "Iraq confirms its support for the policy of OPEC and strengthened and that Iraq is playing an active role in supporting the operations of oil prices." (In other words Kurdistan supports the move of limiting supplies to increase prices, thus revenues in the long run)
"The Allaibi called for a balance between supply and demand in the global market."
It is scheduled to hold an informal meeting of member states of OPEC in Algeria next month on the sidelines of the International Energy Forum and expected that the participation of Russia.

He said Iraqi Prime Minister Haider al-Abadi Tuesday that Baghdad did not reach the full share of the oil market, which may indicate that they would prefer not to curb its production of crude. (In other words Baghdad does not support the move of limiting supplies to increase prices, can a negotiated settlement be made between Kurdistan and Baghdad?)
He explained that Iraq has put the general budget for the year 2017 based on the price of $ 35 per barrel of oil, around the level of the current year, down from an initial forecast was around $ 45 a barrel.
Iraq is the second largest oil producer in OPEC after Saudi Arabia and the public depends spent 95 percent of oil revenues. Iraq and it seems determined to continue to promote the production, which has at present about 4.6 million barrels per day.
Iraq and reap 95 percent of the general budget revenues from oil sales and linking services agreements with companies including CNPC, BP, Shell, Eni and Exxon Mobil, Lukoil and get those companies paid for the additional quantities of oil being produced from the fields.

You let us freeze oil production to raise price of oil and we will pass the HCL. Do you get the political moves going on behind the scenes? Will it work? Remember the new appointed technocratic Iraqi Oil Minister Ali Jabbar Luaibi is a Kurd. We wait and see what will happen. More than likely we will get the HCL very soon.  
Iraqi parliament speaker Salim al-Jubouri, stressed the practical steps in order to activate the national reconciliation in the country file through legislation laws contribute to adopting all political parties or civic and turn them into reality.
He said al-Jubouri, during a meeting with an expert to the United Nations Jeremy Sarkin that full reconciliation project requires great efforts and international support in order to install it as a principle through laws are internal unanimously by all parties and components.
Jubouri said that the parliament is seeking to overcome all the obstacles that would hinder his efforts Bmelvi national reconciliation and constitutional amendments, praising the role of the international community in supporting Iraq, by providing expertise and advice in the formulation of all the laws that are in favor of national reconciliation in the country.

Documents .. Supreme Judicial issue instructions implementation of the General Amnesty Law
{Baghdad} Euphrates News issued a Supreme Judicial Council, instructions and implementation of the amnesty law voted by the House of Representatives last Thursday.

And published the judiciary, on its official website, a number of documents seen by the agency {Euphrates News} pertaining to implementation of the law.
No   delays in the implementation of Amnesty law passed last week.  

HCL and Amnesty play a MAJOR role in the reconciliation process !
The sale of foreign currency window "and a way to ensure stability,”
Long-Presse / Baghdad

Counting the Iraqi Central Bank, on Monday, that the sale of foreign currency window "and a way to ensure stability," the dinar exchange rate to meet the Iraqi economy requirements, while assuring "a greater role for" government to buy and sell the dollar and the development and auditing of funds used sources for banks for the purpose of buying foreign currency.

The central bank said in a statement received (range Press), a copy of it, that "Commenting to issued opinions about the work of selling foreign currency window of the Iraqi Central Bank wishes to state that, sell the currency window is a way to ensure the stability of the dinar exchange rate over the meeting of the Iraqi economy requirements through foreign currency provision to cover the imports of the private sector goods and services, in addition to the needs of citizens for the purposes of travel, medical treatment, study outside Iraq, "stressing" the lack of any allocations in the budget since 2003 and so far for this purpose. "

He added the central bank, that "work on the development of its procedures in this regard by encouraging banks to adopt opening letters of credit mechanism for import rather than remittances style," noting that "the proportion of sales in a manner credits amounted to more than 70% of foreign currency sales."

He said the Iraqi Central Bank, that "the development of a fundamental criterion for the implementation of dollar selling operations to banks include the extent of its commitment to the rules to combat money laundering and financing of terrorism," referring to "the adoption of the preparation and application of standards for the electronic system for window sale and purchase of foreign currency (money orders), and a greater role for government banks for buying and selling the dollar and the development and verification sources of funds used for the purposes of buying the dollar from the sale of foreign currency window. "

The national coalition led by Iyad Allawi confirmed on Monday (22 August 2016), the dollar exchange rate in the domestic market management is a "window of thieves and corrupt", and pointed out that the currency anywhere auction "for wasting money and leaking Iraqi balance across the mafias money laundering" , and he expressed concern regarding the determination to continue the auction currency policy despite the warnings and recommendations of experts, called for the inclusion of the Central Bank reforms approved by the House of Representatives.

Folks Allawi is calling for the implementation of the currency reforms including the project to delete the zeros and to get out of a “closed economy” and thus stop the  need to convert dinars to USD to pay debts.  This is a recent article and so we can see the pressure continues for currency reform.

auf wiedersehen,
Mnt Goat


MountainMole: This is our week, the one we've been waiting for so long. Just think one of these nights we will lay our head down on our pillow to sleep and when the morning dawns we will rise to the day one our exchange. We lay down somewhat limited but wake to be released in such unbelievable way. Too good to be true but this is true

Lilypad: we are seeing more and more articles coming out of Iraq stating in the past tense that Mosul is liberated. We are waiting for the official announcement by Abadi which will kick off the financial reforms into warp speed. Abdi projected to send the 2017 budget to Parliament on Sept. 10th.via article in print. Announcement of liberation of Mosul kickoff and coordinated with everyone in place and ready for financial reforms.

Fireball92:  GM ALL. I agree. w/ the laws and Mosul jabber It seems all is looking good that the budget open on 9/9.. Now, will they pull the trigger immediately or wait for the Fiscal year...

Yada: Fireball I would like to think they will at least pull it for private groups.


BGG   I cannot see how anyone is actually following the financial details of this thing and not be thoroughly EXCITED about where we are (finally!)...

One point that gets missed alot - they have signed deals and agreed to remove and adhere to a more "international standard" regarding their internal MCPs... (..."multi-currency practices")... THIS IS HUGE...

MCPs coming to an end...this is a big point in their whole "economic reform package" - it is a complete overhaul... MCPs and currency being only one point of the program...even until recently - they are still (or have been) operating under some odd MCPs.

The WB and IMF doesn't like it...they have agreed to change - and have taken direct action and taken on breath-taking reforms on daily...it's happening before our very eyes.



AlLonghorn:  elmerf How is Okie doing?

Elmerf123456:  Okie is expectant as the rest of us. He has good days and some not so good days with his breathing but he's a strong willed man and tough as nails.

BouncingAlong:  We have heard the amnesty law is to go into the gazette today....wonder if anyone has been able to confirm it actually happened?

Elmerf123456:  Amnesty:

From my friend across the pond. Yes the Amnesty Law has in fact passed parliament and agreed by all sects. It will now go to the Gazette in print.  This has been long coming. Also as a bonus, what once was a main road controlled just south of Mosul, has now been reopened and is clear of any devices.

This is a major accomplishment. Iraqi people are returning to their homes safely and are grateful and celebratory to have to reunited and returned to their families.


SassyD:  Confidence in the Fed Sinking Fast from Greenspan to Bernanke to Yelle​n: How Much Confidence Do You Have? -- August 27, 2016 --https://mishtalk.com/2016/08/27/confidence-in-the-fed-sinking-fast-from-greenspan-to-bernanke-to-yellen-how-much-confidence-do-you-have/

TnDr:  Currency speculation becoming more mainstream. ...check this out!https://www.yahoo.com/finance/news/jim-rogers-bought-north-korean-1323​43883.html

Freeway2:  Tndr Thanks for the link. Maybe the fact that Jim Rogers has zim, could account for the high rate we are hearing.