In it, the Silvio Berlusconi administration is accused of picking the Nasiriyah area to safeguard a 1997 deal signed by Italy’s largest energy producer, ENI, and former dictator Saddam Hussein.
A government report compiled months before the war broke out recommends that Italy, in case of conflict, should secure the region of Nasiriyah and the nearby area of Halfaya, south of Baghdad, so as to secure “a deal worth 300 billion dollars”.
Both areas are known for its vast oil fields.
According to Benito Livigni, a former manager of ENI and the United States’ Gulf Oil Company, Iraqi’s oil reserves are estimated at 400 billion barrels, far more than the known figure of 116 billion.
If true, this would make Iraq the largest oil producer in the world, ahead of Saudi Arabia…link
This should clarify things for those who have had questions about Berusconi’s response to the events surrounding the fate of the car carrying Giuliana Sgrena and Nicola Calipari. Sgrena survived the accidental assassination attempt.
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$300bn – take this at face value? Other than numbers, I’m convinced Berlusconi is primarily a business man.
Website with extensive info
Prior to the toppling of Iraq’s Ba’athist regime, Iraq reportedly had negotiated several multi-billion dollar deals with foreign oil companies mainly from China, France, and Russia. Deutsche Bank estimated that $38 billion worth of contracts were signed on new fields — “greenfield” development — with potential production capacity of 4.7 million bbl/d if all the deals came to fruition.
Now, the legal status of these agreements is up in the air, increasing the uncertainty level for companies interested in doing business with Iraq. Besides legal issues, companies are also looking for a relatively stable security situation, a functioning government, and other conditions to be in place before they move heavily into the country. In February 2004, Iraqi Interim Trade and Investment Minister, Ali Allawi, announced that negotiations with potential investors in Iraq’s upstream oil sector would be left for an elected, sovereign government, possibly delaying such deals until 2005 or 2006. In September 2004, Prime Minister Allawi stated that he preferred production sharing contracts (PSCs) as a means of attracting foreign investment into Iraq’s oil sector.
Oui – Liberté – Egalité – Fraternité
The original story came out in l’Unità yesterday, 13 May, and the Italian weekly, Diario.Actually it’s been around for quite awhile and was object of a parliamentary interrogation in 2004 by Senator Tana De Zulueta.
Italy, like many nations had concluded bilateral agreements with Saddam to explore and exploit the Iraqi oil reserves, most likely the highest in the world and of the best quality, once the embargo had been lifted.
The agreement between the Italian state oil company, ENI, and Saddam concerned exploration/ exploitation in Nassariya and Halfaya.
Italy had an interest to secure that agreement by joining the coalition.
Since the MNF occupation, ENI has concluded an international tender for one billion barrels of crude and a contract for another four billion with the Iraqi authorities (SOMO).
Of course, the Berlusconi government has always denied this, asserting that Italy is there strictly for humanitarian reasons. The Italian constitution repudiates war. It is therefore against the constitution to participate in a war of aggression. Ostensibly the Italian mission is in Iraq to build a hospital in Baghdad (cost 21 million Euro). How they can do that by putting up a garrison in Nassariya next to the oil refinery (cost 232 million Euro) does raise some questions.
What is “new” about the news is the publication of ample extracts of a government study that predated the invasion of Iraq. The document indicates that Italy has a vested interest to participate in the MNF adventure in order to pick up the spoils. The document presents two scenarios for the coalition: an emergency phase and a reconstruction phase.
Italy may have procured itself a pole position, but the emergency phase has yet to finish.
This document may be the same document referred to by Antonio di Pietro based on an ANSA dispatch, 23 February 2003: “Rebuild Iraq is a 300 billion dollar deal. For Italy this could mean approximately two billion Euro a year in commercial exchanges alone…”
“..[our] objective is to keep Italy among the four major suppliers of Iraq and maintain Italian exportations at a level of 8 to 9% of the total Iraqi importations…”
“… investments should be directed towards increased oil extraction, amplifying refining capacities and strengthening transportation infrastructure…”
The Italian government’s position on “humanitarian aid” is untenable.
More later.
Thanks rom wyo.
I tried to access the Diario article yesterday, but had to register to reach the site.
Guess I should check to see if my password has arrived.
Thanks again.
Not just for feeding your Bushes and Shrubs. 🙂
Here’s some more information on this. The story is the same one that Di Pietro and Li Vigni put out last year, but never got farther than an article in l’Unità and a parliamentary interrogation. At least this time it made TV and foreign news services, with some more details. L’Unità still has the most detailed coverage in the press.
A few pointers to orient those unfamiliar with Italian politics and events.
Antonio di Pietro was the most popular investigator and judge during the Clean Hands operation in the 90’s that temporarily checked the endemic political corruption that brought about the collapse of the Democrat Christians and Socialist parties. Di Pietro resigned the magistracy under a barrage of smear campaigns and went into politics. Along with Carlo Palermo he can be considered one of the greatest Italian investigators of the past decades.
Diario is a small progressive weekly once associated with l’Unità. It is tragically associated with the kidnapping and assassination of one of its reporters last August in Iraq, Enzo Baldoni. Enzo was a Milanese publicist and Red Cross volunteer who was kidnapped while leaving Falluja with an RC convoy.
Now back to ENI.
In early 2001 Cheney put together his Energy Task Force and dedicated some attention to Iraq, and relevant to this argument, Foreign Suitors for Iraqi Oilfields Contracts. Much of the Cheney’s and Bush’s interest in finding an excuse to plunder Iraq as early as 2001 can be found in Ron Suskind’s book “The Price of Loyalty,” as well as in numerous interviews with Bush’s ex-Sec of Treasury, Paul O’Neill.
The Berlusconi government saw a very good deal in the making, especially since the national oil company, ENI, had negotiated an agreement with Saddam on future exploitation of Iraqi oil and gas reserves and modernization of production infrastructure.
All that was needed was a causus belli. With 9/11 the spin machine went into high gear. Within three months (December 2001) there were several secret meetings in Rome, admirably scooped by Laura Rozen, Josh Marshall and Paul Glastris. However, the authors believe that the main object of those 2001 meetings was Iran.
In an off-line scoop by Giuseppe d’Avanzo and Carlo Bonino in la Repubblica, November 27th, 2004, another picture of those meetings comes across. The SISMi chief Nicolo Pollari declared that during those meetings there was a good deal of discussion of ENI oil contracts, Iraq and, of course, Iran. Michael Ledeen who was instrumental in organizing the shows, declared that it was little more than a get together of old friends, perhaps to play bridge. Laura appears to be the only one to have gone on line with this story.
Very Important Update. As this story was breaking Berlusconi kicked out the head of ENI, Vittorio Mincato, for no plausible reason. Mincato had led ENI to unprecedented gains during his tenure. Paolo Scaroni has been appointed administrator. Although Scaroni is considered an excellent manager, it appears his appointment has more to do with his close ties to Berlusconi.
ENI is the major Italian multi-national, presently the sixth oil producer in the world. It has always been tangled up in international intrigue, cases of staggering corruption, and politically imposed incompetence. ENI’s most famous general manager was Enrico Mattei, a maverick innovator assassinated by the mafia when his plane blew up in 1962. In the 70’s and 80’s ENI was involved in one of the great oil profit rip-offs at the hands of the P2 General Lo Giudice.
Rarely does Berlusconi do anything that is not in self interest. His recent sale of 17% of his company Mediaset grossed him two billion Euro. Mediaset had reached its pinnacle thanks to the infamous Gasparri communication law rammed through Parliament with his rubber-stamp majority. Some observers are curious to know what Berlusconi intends to do with this incredible amount of liquidity. Perhaps buy into Telecom?
Or with the change of the guard at ENI and the physiological slump that may follow, why not ENI?