Oil Industry Loopholes Threaten Kurdistan’s Environment

“Oil companies coming to the region start their explorations with major chemical equipment,” local environmental activist, Dayari Ali, says. “And they pay absolutely no mind to environmental considerations. Recently one of the companies working in the Bazian area ended up working with huge amounts of mud [this is one method of oil extraction] and it actually led to the flow of oil into local water sources.”

Not all of the pollution is so obvious right now, Ali notes. Some of the effects will only become obvious in 10 to 15 years when there are more cases of cancer in the region.

“Basically the Ministry of Natural Resources wants to attract the largest number of oil companies here, to extract the most oil, without caring at all about the environment,” Ali concluded.

It is particularly difficult to enforce the laws around this topic at the moment. The oil industry in Iraqi Kurdistan is working in a kind of twilight zone. The government of the semi-autonomous region in Erbil has concluded deals with multi-national oil companies but the federal government of Iraq, in Baghdad, who should be in charge of the whole country by rights, says these deals are actually illegal and should not be honoured.

As news agency Reuters explained in a recent article, “Baghdad insists it alone has the sole authority to sign deals and export oil, but Kurdistan says the constitution allows it to agree to contracts and ship oil independently of Baghdad”.

What the oil industry is doing in Iraqi Kurdistan is, to some extent what the US-based Wall Street Journal recently described as “global wild-catting” – the publication was writing about the latest deals done by Tony Hayward, Chief Executive of London-based Genel Energy and formerly head of BP.

“Mr Hayward … has joined a breed of wildcatters who deploy a risky and sometimes lucrative strategy: Look for oil in politically or geologically fraught lands after cutting deals with governments that claim the lands, even if those claims are in dispute,” the publication wrote. “Global wildcatters like Mr. Hayward are playing a growing role in the oil industry. These oilmen operate on what the 56-year-old Mr. Hayward calls “the political frontier”. They sometimes defy the wishes of Washington and the United Nations, which say companies can amplify conflicts and foment instability by entering disputed lands.”

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