MARCH 19 2012 19:13h

Iraq bans security firms on oil fields

Iraq bans security firms on oil fields

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BAGHDAD, March 19 (UPI) -- With U.S. forces gone from Iraq, Baghdad has banned foreign security contractors, long abhorred by Iraqis, from the 12 major oil fields being developed by international companies, mainly in the south.

But the government may find that hard to enforce.

Iraq's military and security forces, still being trained by Americans, have shown themselves incapable of maintaining stability and protecting these vital and vulnerable facilities amid a surge in political violence since the U.S. withdrawal was completed Dec. 18.

The order by Iraq's Oil Ministry was issued Feb. 29 and signed by Director General Faisal Walid. The contractors, the ministry declared, will be replaced by Iraq's Oil Police who "will provide the necessary protection."

Whether the 31,000-strong U.S.-trained force is capable of shielding Iraq's vast oil and gas infrastructure, that includes 4,500 miles of pipelines which Baghdad is expanding under a $50 billion upgrade program, remains to be seen.

The ban reflects a wider drive by Prime Minister Nouri al-Maliki's Shiite-dominated government to impose tough restrictions on the tens of thousands of private security personnel who remain in Iraq, and eventually to throw them all out.

In February, the government introduced a parliamentary bill aimed at limiting the number of foreign security contractors operating in Iraq. These companies using heavily armed mercenaries, most of them ex-military men, have a reputation in Iraq for reckless operations in which innocent civilians have been killed and with few of the perpetrators being brought to justice.

The companies, operating with U.S. sanction, have operated with little oversight or accountability. Many of the foreign mercenaries are also hostile toward Iraqis generally.

The most notorious incident involving private military companies was the killing of 17 civilians in Baghdad's Nisour Square by men from Blackwater Worldwide Sept. 16, 2007. Iraqis were incensed when a legal case against Blackwater was dismissed. The legitimacy of the U.S. occupation was seriously undermined and in the eyes of many forever discredited.

The company changed its name to Xe to distance itself from such atrocities but its rebranded former employees still operate in Iraq.

"The U.S. has now left Iraq," the Middle East Economic Digest reported," but the legacy of the private security firms remains.

"Baghdad's security woes have been described as a competition for legitimacy.

"If the government lets armed contractors operate on its soil without accountability, it cannot claim to be legitimate and will not be viewed as such by the locals," MEED observed.

The dismissal of the case against Blackwater in 2010 is a painful reminder of this … Whether the Oil Ministry can push through with plans to remove all foreign security firms from its oil fields is a different issue …

"The Oil Police, who are expected to take over the job of providing security, are still relatively young and largely untested.

"The foreign oil firms who employ private contractors to protect their assets may yet have enough leverage to keep hiring them for now."

Some of the 109 security companies registered in Iraq say they're already having problems, such as security operating permits and obtaining visas for foreign employees. These, officials say, are just part of what they see as a government drive to impose administrative roadblocks to make things difficult for foreign contractors.

Most of them are U.S., British or European firms that employ in excess of 36,000 personnel, more than half of them foreigners.

Western oilmen say that if these operatives were forced out of Iraq, it would leave the oil fields and their widespread infrastructure, widely attacked during the post-2003 invasion fighting, highly vulnerable to attack by insurgents.

This at a time when Baghdad wants to quadruple production to around 12 million barrels per day from the current level of 3 million bpd. Iraq cannot achieve this without the score of oil majors that have signed 20-year production contracts with Baghdad since 2009. The government's whole reconstruction program depends on oil revenues.

Maliki appears to be seeking to set himself up as dictator controlling a high centralized power structure. To achieve that he will need to develop Iraq's vast energy wealth.

And to do that, he'll need to keep the foreign oil companies sweet because they're the ones providing the investment capital and the advanced technologies that will make it happen.