Baker Botts Cuts an Iraqi Oil Deal -- and Draws a Backlash

[Joanne98]

http://www.law.com/jsp/article.jsp?id=1195639466942

Baker Botts Cuts an Iraqi Oil Deal -- and Draws a Backlash
Daphne Eviatar
The American Lawyer
11-26-2007

Ever since oil first gushed in Texas, Houston-based Baker Botts has represented wildcatters. While those deals were always risky, even Baker may not have anticipated that the deal made by the firm for its latest wildcatter -- Hunt Oil Co., a longtime client hungry for oil in Iraq -- was risking quite so much.

In September, Baker lawyered a deal between Hunt and the Kurdistan Regional Government (KRG). In mid-November, the Iraqi Oil Minister announced that all oil companies that have cut deals with the KRG will be blacklisted. "Any company that has signed contracts without the approval of the federal authority of Iraq will not have any chance of working with the government of Iraq," oil minister Hussein al-Shahristani told reporters during OPEC meetings in the Saudi Arabian capital of Riyadh. "We warned the companies that there will be consequences... that Iraq will not allow its oil to be exported," Shahristani said.

The deal was for exploration rights in northern Iraq. The Baker Botts team was led by Sean Korney, a Dubai-based partner with a record of representing energy companies buying up oil and gas rights around the globe. None were as controversial as the Hunt Oil rights, however. Not only was the deal made in a war zone, but Iraq is still working on oil resources legislation. Under the October 2005 Iraqi constitution, local oil is owned by "the Iraqi people."

Neither Baker Botts nor Hunt Oil would comment on the deal or on the Iraqi government's latest pronouncements.

Both the U.S. and Iraqi governments are annoyed by the Hunt contract. "Any deal has no standing as far as the government of Iraq is concerned," Iraqi oil minister Hussain al-Shahristani told reporters in September, even before he said in November that he'd bar the companies from working in the country. The agreements could "have no legal standing," added Thomas Casey, a spokesman for the U.S. Department of State, at an October briefing.

The Bush administration also claims that the deal may hurt peace prospects in the region. Passing a national oil law that will cover Sunni, Shiite, and Kurdish regions is one of the key "benchmarks" set by the Bush administration to measure progress in Iraq. And this deal, according to Casey, is not "helpful in terms of seeing a national oil law get passed." No one at Baker Botts would comment.

Meanwhile, the House Oversight Committee in Congress is investigating whether long-standing ties between Ray Hunt, the CEO of Hunt Oil, and the Bush administration (Hunt sat on the president's Foreign Intelligence Advisory Board) may have given Hunt access to classified information prior to the oil deal. The company denies that it relied on anything confidential.

Hunt and Baker Botts aren't the only firms with their eyes on Iraq, home to the third-largest oil reserves in the world. "All major oil companies are taking a very close interest in the future potential in Iraq," says Mathew Kidwell, a partner in the Dubai office of Fulbright & Jaworski. "We have certainly had discussions with a number of our oil industry clients about the legal framework in Iraq and in the regions." He cites Kurdistan as having "the most immediate potential for foreign investment" in the area, mostly because "the security situation is much more robust" than in Sunni and Shiite areas. But uncertainty about the KRG's standing and fear of angering the central Iraqi government have so far kept the major international oil companies away.

Nonetheless, the KRG has signed more than a dozen deals at this point with non-American companies. But the Hunt deal appears to be riskier
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[stillcool]

1. same old wine...

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One Cheney recruit recently in the headlines is Ray Hunt of Dallas-based Hunt Oil Co. Hunt is a longtime supporter of the Bush clan: he raised money for the elder Bush and later led the Republican National Committee's Victory Fund for George W. Bush, donating $20,000 to the committee himself. Bush rewarded him with a seat on his Foreign Intelligence Advisory Board. Hunt and his wife have donated more than $400,000 to Republican state campaigns, while his company and its employees have given more than $1 million to Republican causes since 1995. Hunt's son, a vice president in the company, served as an energy consultant to Bush during the campaign, and later as a member of the presidential energy transition team. Both Ray Hunt and Halliburton Co. are major donors to the National Center for Policy Analysis, a conservative think tank based in Dallas, the stated goal of which is to "develop and promote private alternatives to government regulation and control, solving problems by relying on the strength of the competitive, entrepreneurial public sector."

In September 2003, the Inter-American Development Bank approved a loan for a consortium led by Hunt Oil to construct a natural gas pipeline in Peru that environmentalists say will severely damage the rain forest there—after Ex-Im Bank pulled out due to environmental concerns. In 2002, Hunt hired KBR to build the $1 billion plant at the pipeline's origin.

http://www.corporatewatch.org/?lid=274
The Center for Strategic and International Studies (CSIS)
Halliburton director Ray L. Hunt is on the board of trustees of CSIS, a private organisation head-quartered in Washington DC. According to its web site, it has 'been dedicated to providing world leaders with strategic insights on — and policy solutions to — current and emerging global issues.' CSIS is dominated by members with strong ties to the US government and private industry.72

Halliburton Co · DEF 14A · For 5/18/99
http://www.secinfo.com/dScRa.6Mx.htm
SEC Info
(Item 1)

Effective as of the consummation of the merger with Dresser Industries, Inc.
(the "Dresser Merger") on September 29, 1998 (the "Effective Date"), the
number of Directors constituting the Board of Directors of the Company was
increased from 10 to 14 and Messrs. William E. Bradford, Lawrence S.
Eagleburger, Ray L. Hunt, J. Landis Martin and Jay A. Precourt were elected as
Directors. Mr. Dale P. Jones, who served as a Director since 1988, retired
from the Board of Directors as of the Effective Date.

RAY L. HUNT, 55, For more than five years, Chairman of the
Board and Chief Executive Officer, Hunt Oil Company (oil and gas
exploration and development); Chairman of the Board, Chief
Executive Officer and President, Hunt Consolidated, Inc. and
Chairman of the Board, Chief Executive Officer and President,
RRH Corporation; joined Halliburton Company Board in 1998;
member of the Compensation and the Management Oversight
Committees; Director of Electronic Data Systems Corporation,
PepsiCo, Inc., Ergo Science Incorporated, Security Capital Group
Incorporated and Federal Reserve Bank of Dallas.