Texas and Kurdistan oil each other up

Despite the fact that US and other oil companies have been operating in Kurdistan for quite some time already, the passage of a Kurdish version of an oil law was sure to further spur activity. And so it is. Within a month of the KRG passing their oil law, Texans are now able to officially move in.

Texas' Hunt Oil Co. and Kurdistan's regional government said Saturday they've signed a production-sharing contract for petroleum exploration in northern Iraq, the first such deal since the Kurds passed their own oil and gas law in August.

A Hunt subsidiary, Hunt Oil Co. of the Kurdistan Region, will begin geological survey and seismic work by the end of 2007 and hopes to drill an exploration well in 2008, the parties said in a news release. Terms of the deal were not disclosed.
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Revenue will be shared by the KRG throughout Iraq, consistent with the Iraq constitution and the Kurds' new petroleum law, issued by the Kurdistan National Assembly early last month.

Despite Iraq's vast oil reserves, major international companies have sat on the sidelines, not only for security reasons but because of the absence of legislation governing the industry and offering protection for investments.

A draft oil law for all of Iraq has been bogged down for months, in part because of disputes over who will control the proceeds.

In August, however, the Kurdish self-governing region in northern Iraq enacted its own law governing foreign oil investments. The move angered the central government in Baghdad, but the Kurds are determined to push ahead with oil exploration.

I love the conceit Ashti Hawrami, the regional government's minister of natural resources, espouses that the oil law has produced a "a supportive and transparent business environment," while simultaneously preventing the disclosure of contract terms. And don't expect this to change. The terms of these PSAs will likely never be revealed and the direction and share of oil revenues in Iraq will likely have to be pieced together from a variety of sources, if it can be done at all.

Now, it is indeed a curious sight: all these Texas oil companies moving in on Kurdish oil fields, even while being admonished by the State Department. Ballsy, really. Even Exxon doesn't seem to be doing this but perhaps this only because their profile is bit larger than some of the small lights in the oil and gas industry.

As I pointed out earlier, if they're from Texas and oil companies, they probably have some relationship to either Dick Cheney and/or George Bush. Well, Hunt Oil certainly has that. From Hunt Oil's own website, we can learn that Hunt Oil's CEO is a one Ray Hunt.

[I]n October 2001 and again in January 2006, Mr. Hunt was appointed by President George W. Bush to the President’s Foreign Intelligence Advisory Board in Washington, D.C.

Furthermore, Ray Hunt serves on the National Petroleum Council which advises the Secretary of Energy. As interesting is Hunt Oil's Senior Vice President and Director, Tom Muerer, who serves on the board of The Middle East Institute, a "think tank" whose major funders are Chevron, ConocoPhillips, ExxonMobil, Raytheon, Saudi Aramco, Shell. In a not unrelated note, both Hunt and Muerer are or have been trustees for the Southern Methodist University, where, despite the protests of actual Methodist ministers, the George W. Bush presidential library is likely to be housed.

How convenient it is that Hunt Oil, with a CEO on the president's Foreign Intelligence Advisory Board, winds up with, as far as I can tell, the first officially sanctioned oil contract in Iraq.

I love it when a plan comes together.