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Oil Giants Bend to Iraq's Terms

War for oil hasn't been too lucrative for American companies

By Kevin Spak,  Newser Staff

Posted Dec 1, 2009 10:35 AM CST
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(Newser) – If the Iraq war was fought for oil, it’s done little to enrich American oil companies, which are just now striking deals to service the country’s fields—and at far worse terms than they’d hoped. Most companies balked at Iraq’s initial service contract offers, refusing to bid in a June auction. But in the past month, many have swallowed their pride and inked nearly identical deals, the New York Times reports.

The oil giants were after production-sharing agreements, but to Iraqis those deals smacked of colonial times, when foreign companies controlled the country’s fields. They favored service contracts, which pay the companies a fee per barrel produced. The profit margins are tiny, but the companies have accepted, believing they need to get a foothold in Iraq. They’re hoping for better contracts later on, and a crack at the loaded Basra fields.

An Iraqi worker operates valves at the Rumaila oil refinery, near the city of Basra, 550 kilometers (340 miles) southeast of Baghdad, Iraq, on Monday, Nov. 9, 2009.
An Iraqi worker operates valves at the Rumaila oil refinery, near the city of Basra, 550 kilometers (340 miles) southeast of Baghdad, Iraq, on Monday, Nov. 9, 2009.   (AP Photo/Nabil al-Jourani)
An Iraqi worker operates valves at the Rumaila oil refinery, near the city of Basra, 550 kilometers (340 miles) southeast of Baghdad, Iraq, on Monday, Nov. 9, 2009.
An Iraqi worker operates valves at the Rumaila oil refinery, near the city of Basra, 550 kilometers (340 miles) southeast of Baghdad, Iraq, on Monday, Nov. 9, 2009.   (AP Photo/Nabil al-Jourani)
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COMMENTS
Showing 3 of 20 comments
IndependentThinker
Dec 2, 2009 8:44 AM CST
@hyb: No he did not. He had nothing to do with the war at all. Our "crusade" in Iraq is what Spudsy is referring too. It has killed more than 4100 Americans and wounded more than 200,000.
hybrid
Dec 1, 2009 10:18 AM CST
@spudsy christian righteousness killed many Americans and our economy. could you expand your thought on this?
hybrid
Dec 1, 2009 8:26 AM CST
soon i hope
Money • World

 
Iraq • Iraq oil • oil companies • Iraq war • Exxon Mobil • oil industry

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