Former US envoy Galbraith could earn $100m from Iraqi oil field
A prominent former United Nations official was forced to defend himself yesterday against accusations that he used his influence in Iraq to enrich himself.
Peter Galbraith, 58, a former US ambassador who recently quit as deputy head of the UN mission in Kabul, struck a potentially lucrative oil deal in Iraqi Kurdistan which could reportedly earn him $100 million (£60 million). He helped the Kurds to negotiate provisions in the 2005 Iraqi Constitution that gave them control over new oil finds on their territory.
“The Kurds did not give me anything,” he told The Times, describing the $100-million figure as “improbable”. “This was a commercial arrangement by a company which made its own judgment about what was an appropriate arrangement.”
Not public at the time was the fact that Mr Galbraith stood to profit from the provisions through his arrangement with a Norwegian oil company, DNO. Months later, DNO discovered the large Tawke oil field in northern Iraq. The disclosure of Mr Galbraith’s stake fuelled Iraqi complaints that influential people in the Western powers that launched the 2003 war were trying to take control of Iraq’s oil.
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Feisal al-Istrabadi, a former Iraqi diplomat and legal advisor, said the revelation cast doubt on Iraq's fragile constitutional order.
“The idea that a foreign oil company was in the room drafting the Iraqi Constitution has me reeling,” he said. “It casts a tremendous pall on the legitimacy of the process. We do not let Shell draft the constitution of Nigeria.” Mr Galbraith acted as a go-between for the Norwegian oil company with the Kurdish regional government until its oil contract was signed in 2004. He continued to be paid by DNO while advising the Kurds in negotiations on the Iraqi Constitution.
“I was never negotiating the Iraqi Constitution,” he said. “The Kurdish leaders asked me for advice. That is an entirely separate matter from negotiating the Iraqi Constitution.” According to the Norwegian financial newspaper Dagens Naeringsliv, Mr Galbraith and a Norwegian partner, Endre Rosjo, each took a 5 per cent stake in the large Tawke oil field, which was discovered by DNO in December 2005. Mr Galbraith’s Delaware-registered company, Porcupine, is currently in dispute with DNO, however, and the matter is under arbitration in London.
DNO says that the arbitration followed a 2008 review by Kurdish authorities that barred certain third-party interests in oil fields in Kurdistan. “DNO has rejected the basis for any claims from such third parties, which relates to up to 10 per cent beyond DNO’s interest,” the company said.
“I have an arrangement with the company,” Mr Galbraith said. “I do not have a party interest in an oil field. I do not have an ownership interest in the oil field.He has been an influential advocate of the dismemberment of Iraq and the independence of Kurdistan.
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