Russia-Iraq tension over oil
- From: "muslim-news.net" <muslim_affairs@xxxxxxxxx>
- To: news@xxxxxxxxxxxxx
- Date: Wed, 18 Dec 2002 10:42:32 +0000 (GMT)
http://www.heraldsun.news.com.au/common/story_page/0,5478,5685270%255E401,00.html
RUSSIA angrily assailed Iraq overnight for its decision to cancel a major oil
contract with a top Russian company ? a surprise blow that came amid Moscow's
push for a political settlement around Iraq.
"Such a move can only be interpreted as running contrary to the friendly
character of Russian-Iraqi relations and the level of bilateral cooperation in
different areas," the Russian Foreign Ministry said in a statement. It was
Moscow's harshest criticism of Baghdad to date.
Abbas Khalaf, Iraq's ambassador to Moscow, said earlier today that the Iraqi
government had severed the 1997 contract with Russia's largest oil company,
Lukoil, because it had failed to start work at the West Qurna-2 field.
He shrugged off Lukoil's claim that the deal was hampered by UN sanctions
against Iraq.
"Lukoil has made no investment whatsoever, it has just signed the contract and
left," Khalaf said at a news conference, adding that other Russian companies
had worked in Iraq despite the sanctions.
The Russian foreign ministry strongly backed Lukoil, saying: "No Russian
company can violate the sanctions regime." It said the problem cannot be solved
by unilateral action and urged Baghdad to talk to Lukoil to resolve the
dispute.
The ministry said Russia was particularly annoyed by the cancellation after its
opposition to unilateral US action in Iraq.
"It evokes bewilderment that the step was taken at the moment when Russia was
trying to defuse tension around Iraq and striving to solve the Iraqi issue by
peaceful political means together with other countries," the statement said.
Russia last month backed the UN Security Council's tough resolution demanding
Iraq comply with weapons inspectors, but warned the United States against using
force without explicit UN approval.
Lukoil vice president Leonid Fedun described Iraq's decision to break the
contract with his company as "an attempt to somehow influence or even punish
the Russian side for its, as Iraq sees it, failure to prevent the UN Security
Council from voting on sending weapons inspectors to Iraq," the Interfax news
agency reported.
Khalaf flatly rejected allegations that the decision had anything to do with
politics. He said he was aware of reports that the company was talking to the
United States in a bid to secure its interests in Iraq if Iraqi leader Saddam
Hussein is ousted, but refused to comment.
US President George W Bush has assured Russian President Vladimir Putin that
Russia would be a major player in rebuilding a postwar Iraq - a promise
intended to quell Moscow's fears that a new Iraqi government might renege on
Baghdad's $US7 billion ($A12.4 billion) Soviet-era debt to Moscow and snub
Russian firms in favour of US and other Western companies.
Lukoil said on Thursday that it had received a letter signed by an Iraqi deputy
oil minister that said Iraq was breaking its contract with Lukoil and two other
Russian companies, Zarubezhneft and Mashinoimport, to develop the West Qurna-2
field.
Khalaf said today that Baghdad had only severed the contract with Lukoil, while
the other two companies were still invited to continue their work.
Lukoil's Fedun said Lukoil would likely go to court if Iraq implements its
decision. He said the contract stipulated that a party to the deal can withdraw
from it only if authorised by an arbitration court in Geneva.
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