EITI in Iraq

Iraq signed up to EITI in February 2010 and issued a draft of its first reconciliation report at the start of 2012

Iraq first announced its intent to implement the EITI in 2008 and Deputy Minister Mr Barham Salih met with EITI Chairman Peter Eigen in Baghdad in October 2008. The Iraq EITI (IEITI) Launch Conference took place on 9-10 January 2010, when Prime Minister Nouri al-Maliki announced Iraq's formal candidacy. The first IEITI Stakeholder Council meeting was held on 22-23 September 2010. Civil society was represented by several organisations, and in 2011 formed a coalition grouping more than 40 organisations around the EITI initiative.

On the 12 December 2012 Iraq was declared a "compliant country" by the EITI Board on the basis of a final validation report released in August 2012. According to the official EITI website, protracted and difficult negotiations took place between the IEITI and the Kurdistan Regional Government (KRG), but the 2010 will cover Kurdistan's oil and gas production and revenues, which will be reflected in a separate chapter.

However despite Iraq's history of collaboration with the EITI, Revenue Watch Institute highlights a lack of awareness among civil society, particularly in the northern Kurdish region, as an obstacle.

=First Reconciliation Report: December 2011=

The first reconciliation report was issued by Iraq's EITI Secretariat on the 23 December 2011. It tallied some $41.3 billion of receipts by the State Oil Marketing Organisation (SOMO) in sales of Iraqi oil to international buyers. It initially showed a discrepancy of $1,090 million between figures reported by SOMO and those of the buying companies but these were all subsequently explained in follow-up consultations, said the report, prepared by Price Waterhouse Cooper.

The report also reconciled the physical quantities of oil sent from Iraq's two main producing companies, North Oil Company and South Oil Company, to SOMO.

The report used a disaggregated system, listing 34 companies which had bought oil from SOMO during 2009 and further breaking up the figures into regional markets. The top three buying companies were the Indian Oil and Gas company, with over four billion dollars worth, ExxonMobil with over three billion dollars, Total with just under three billion dollars, and BP with over two billion dollars.

The report also noted that Price Waterhouse Cooper was supposed to receive confirmation that the sums reported by SOMO were actually deposited in the Federal Reserve Bank of New York, under the arrangement put in place by the UN Security Council, but that the bank had not supplied this confirmation. The report listed some 14 separate discrepancies in reports between SOMO and the buying companies.

=Criticism=

Energy consultancy OpenOil has criticised the nature of Iraq's path towards EITI compliance, noting that submissions from buying companies were not always signed off by the CEO or CFO as stipulated by EITI rules, and that the Central Bank of Iraq was unable to obtain statements for the Development Fund for Iraqi oil revenues from the Federal Reserve Bank of New York, despite multiple requests over a three-month period. Therefore there was no confirmation that the money received by the Iraqi government ultimately corresponded to the invoices sent out by SOMO. The author also called for a wider scope of implementation before Iraq was granted compliant status.

=External Links=

Official Website: www.ieiti.org.iq

=References=