Randy Shannon – 3/25/07

This page was last updated on March 25, 2007.

Exploiting Iraq for its oil; Randy Shannon; Beaver County Times; March 25, 2007.

In 2006 Mr. Shannon penned a letter to the editor entitled “The Times is a tool of the GOP,” and he was serious.

For background info about Mr. Shannon, see my notes on his speech of October 16, 2004, in front of the Beaver County Courthouse.

I wish Mr. Shannon would cite the sources of his “information.” I suspect that info would be at least as entertaining as his letters.

Below is a detailed critique of the subject letter.

“The Iraqi cabinet approved a new oil law drafted by the United States in February. Bush’s surge had forced the Iraqis opposing the new oil law into hiding, chiefly the cabinet ministers from al-Sadr’s group.

“In a recent Associated Press article, Prime Minister Maliki stated that if the Iraqi legislature did not pass the oil law by June, Bush would overthrow his government. Secretary of State Condoleezza Rice had publicly threatened Maliki in January because the law had not been approved earlier.”

[RWC] There are two forms of production sharing agreements (PSA), but Mr. Shannon is purposely conflating the two.

The PSA of primary interest to the U.S. is the one that requires all Iraqi oil revenue to be shared by the entire country, not just the provinces that produce oil. That’s important because while the Kurdish and Shia areas have a lot of crude, the Sunni areas tend to be crude poor.

The second type of PSA is one in which an oil-rich, but capital-poor country enters into an agreement with an investor to explore for and develop oil fields. Without these agreements, oil-rich countries without the financial resources to develop its resources would remain poor. In any case, PSAs are just like any other contract and investors must compete for them. Barring shenanigans, this process should result in fair terms for both the investor and the country.

“The Iraqis’ problem is the law includes production sharing agreements that allow the oil companies to exploit Iraq’s oil under terms equal to armed robbery.

“The PSA is a contract for exploiting oil that is typically offshore or in remote areas. The PSA guarantees the oil company all costs and the lion’s share of the income.”

[RWC] According to Radio Free Europe, here’s a summary of the oil law Mr. Shannon finds so evil. I believe you’ll find Mr. Shannon’s interpretation of the law to be “creative.”

“But Iraq’s oil, like Iran’s and Saudi Arabia’s, lies in large pools near the surface, easily extracted at a cost of $1 per barrel. No other country with such deposits has a PSA contract.”

[RWC] Yep, you just send Jed Clampett “shootin at some food, and up through the ground [comes] a bubblin’ crude. Oil that is, black gold, Texas tea.”

If Iran’s oil is so easily produced, why does Iran’s production continue to drop despite huge reserves? You can ask the same question about Venezuela.

“An Iraqi PSA has been the goal of the oil companies and Vice President Dick Cheney since 2002. The immediate occupation of Iraq’s oilfields and the appointment of Cheney’s man as oil minister show the occupation’s objective is to steal Iraq’s oil.”

[RWC] Hmm, and here I thought “occupying” Iraq’s oilfields early in the war was to keep Saddam Hussein loyalists from blowing up the oil wells as they did when we chased them from Kuwait in 1991. I now know it was a plot “to steal Iraq’s oil.” I wonder why Mr. Shannon doesn’t get into writing conspiracy novels.

Did you notice how VP Cheney suddenly appeared in this letter? Mr. Shannon did forget something, though. He forgot to mention Halliburton. <g>

Which oil minister is/was “Cheney’s man?” By my count, there have been at least three oil ministers since 2003.

“Bush opposes a date certain to leave Iraq because the Iraqis could hold out against passage of Cheney’s oil law. Bush needs more time to kill or imprison Iraqis that oppose unfair oil contracts.”

[RWC] Yep, U.S. Special Forces operatives are murdering Iraqis who “hold out against passage of Cheney’s oil law.” Are these the same guys who blew up the WTC buildings, the Pentagon, and crashed United Flight 93 on 9/11?

“Rice, a former Chevron Oil director, said, ‘The Iraq war is worth the sacrifice.’

“I don’t agree. The ‘war on terror’ is really a global ‘war against democracy.’”

[RWC] Against which democracies are we waging war? Lest we forget, Mr. Shannon believes the U.S. is fascist, we’re in a state of terror, and al-Qaida doesn’t exist in the U.S.

If we were really taking Iraq’s oil as Mr. Shannon claims, I don’t understand why he would have a problem. After all, he has no problem with taxes on “the rich” that amount to “armed robbery.”