BP made billions from British invasion of Iraq: Declassified UK
8 Min Read
British Petroleum is revealed to have been one of the greatest benefactors from the Western invasion of Iraq, with billions of dollars made from exploiting the country's resources.
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Gas flares are seen at the Rumaila oil refinery, near the city of Basra, 550 kilometers (340 miles) southeast of Baghdad, Iraq, November 9, 2009 (AP)
New information that came to light on the 20th anniversary of the invasion of Iraq revealed that British Petroleum (BP), a British oil conglomerate known for its exploitation of foreign intervention to line its pockets, was benefiting from the British occupation of Iraq through pumping oil out of the country.
BP pumped oil worth £15.4 billion ($18.92 billion) in Iraq since it started production in the country back in 2011 after a hiatus of some four decades.
Many war critics have underlined that the invasion of Iraq was for plundering Iraq's oil, and not the pretext that was used by Western governments back then, which claimed that Iraq's government possessed weapons of mass destruction, as none were found. The US and UK administrations at the time, mainly President George Bush and Prime Minister Tony Blair, have been accused of knowing before the war that there were no WMDs in Iraq and that their invasion of the country was aimed at making political and economic gains at the expense of the Iraqi people.
Iraq, the country with the world's fifth-largest proven oil reserves, was invaded in 2003 by the US, the UK, and other allies who declared their bid to take down the government. The war, all in all, was declared illegal by the United Nations, killing an estimated 655,000 Iraqis in three years.
Declassified UK reported on BP's gains, citing the company's annual reports. The media outlet said the amount of money made by the corporation was calculated using the average annual price for a barrel of oil for each year on record.
Barrel after barrel, Iraq is plundered
11 years after its production kicked off in Iraq, BP pumped 262 million barrels of Iraqi oil after having started producing 31,000 barrels of Iraqi oil daily back in 2011.
Before anyone knew it, BP was pumping 123,000 barrels of oil a day by 2015, and within five years from then, the multinational corporation had produced more oil from the afflicted country than its combined operations in Europe.
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BP once stood for Blair Petroleum in the eyes of the public due to the then-Prime Minister's constant lobbying for the firm, which put it in a more than favorable position for the British government.
BP, alongside Shell, another multinational oil corporation, is deeply rooted in Iraq. A nation that had just emerged from a British mandate, suffering from instability, and having been found to be a resource-rich nation after oil reserves were discovered there, BP and Shell saw Iraq with dollar signs for eyes.
Shell and BP owned 48% of the Iraq Petroleum Company at some point, which practically had a full-fledged monopoly over oil production in the country. Both corporations maintained a foothold in Iraq up until the nationalization of the Iraq Petroleum Company.
Old habits don't die
After it was uprooted from Iraq, a proclaimed oil-rich nation, BP couldn't keep itself out of the country for much longer, and it went back six years after the Western invasion seeking more oil.
The situation is similar in Libya, with the United Kingdom returning for the country's oil 11 years after leaving.
For more information, check out: 11 years later, the UK returns to Libya for oil
Libya's National Oil Corporation (NOC) agreed in October for BP to begin drilling for and producing natural gas in a major project off the north African country's coast.
The UK corporation, whose board of directors includes former MI6 chief Sir John Sawers, controls exploration areas in Libya nearly three times the size of Wales.
BP re-entered the country in 2007, but its operations were halted by the 2011 NATO-backed aggression on the country, resulting in the ousting of Gaddafi and his murder later on.
BP operations resumed after the signing of a memorandum of understanding in 2018 between the NOC and Eni, the Italian oil major, to resume exploration, with Eni as the oil field operator. BP CEO Bob Dudley hailed the agreement as an important step "toward returning to our work in Libya."
The $8 billion BP-ENI project includes two exploration areas, one onshore in the Ghadames basin and one offshore in the Sirte basin, totaling approximately 54,000 km2. The Sirte basin concession alone encompasses an area larger than Belgium.
The UK's other oil major, Shell, is also "preparing to return as a major player" in Libya, according to its statement in a confidential document. After putting its Libyan operations on hold in 2012, the corporation is now planning to explore new oil and gas fields in several blocks.
Changing the terms
The Bush administration sought to make the Iraqi government sign a new oil law that would have practically privatized the country's oil industry through an unconventional type of contracting - through production sharing agreements (PSA).
The PSAs would have allowed international oil corporations to sign contracts with Baghdad and grant them a percentage of the oil proceeds in exchange for developing set sectors of Iraq's petroleum sector.
The Bush administration's plans failed miserably after the nationalists-controlled Iraqi parliament rejected the law in question due to the parties' opposition to the occupation, but the West still made some money from its invasion of Iraq, as the Iraqi government used a law allowing for technical service contracts (TSC), which kept Iraqi oil under the state's ownership and gave a flat rate to oil conglomerates in return for their services.
BP signed a TSC with Baghdad that would see it recovering costs and getting a fee per barrel of production above a set threshold, though it lasted claimed that the contract it had with Iraq functioned as a PSA.
Conglomerates strike oil
The Rumaila field was a hotspot for oil conglomerates. Located near Basra, Rumaila is one of the largest oil fields in the world, and it was allegedly discovered by BP in the 1950s at first.
BP was the lead contractor on the massive oil field, with 38% working interest, while the China National Petroleum Company (CNPC) came in second with 37%, and the remaining 25% was held by Baghdad.
Rumaila was producing half of Iraq's oil exports, and over the upcoming decade, the British conglomerate managed to extract an average of 65,000 barrels of oil a day from the vast oil field.
Still, BP increased in 2014 its working interest in the Rumaila TSC to 48%, and the contract was extended to 2034.
BP in 2015 hit the record of 123,000 barrels of oil produced in Iraq daily, making the country BP's "principal area of production".
Downing Street's complicity
Additionally, one key incident highlighted the British government's complicity in the plundering of Iraqi wealth, as the UK's first special representative in Iraq in 2003, John Sawers, joined the company board in 2015, making a profit from his shareholding and increasing his net worth exponentially since he joined the company.
He was distinguished by his close ties to Blair, as he served as his foreign policy adviser for two years before he was appointed as London's special representative to Iraq.
Sawers was supposed to "work with Iraqis... and guide the political processes leading to the establishment of an interim administration.
Moreover, Shell also re-entered Iraq in 2009 after it was able to obtain a government contract for developing the Majnoon field, which was also close to Basra, with an estimated 38 billion barrels of oil. Shell was given a 20-year TSC with a 45% stake in Majnoon.
Shell claimed that production would reach a whopping 1.8 million barrels of oil a day, an exponential increase from the 45,000 bpd it was producing at the time.
Shell has over the years deepened its roots in Iraq, it received a 15% share in a contract for developing the West Qurna 1 field before it renegotiated the deal in 2014 and struck oil when the government's share was reduced from 25% to 5%, with the remainder dispersed to other shareholders, including itself.
A few years later, Shell sold out its 20% interest in the West Qurna 1 field, as well as its 45% interest in the Majnoon field.
All in all, Iraq was drained of its oil, and the only benefactors were Western governments and oil corporations who funded and led the invasion of Iraq to make bank at the expense of the suffering of the Iraqi people.
