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PP RUEHBC RUEHDE RUEHIHL RUEHKUK
DE RUEHGB #2752/01 2310518
ZNY CCCCC ZZH
P 190518Z AUG 07
FM AMEMBASSY BAGHDAD
TO RUEHC/SECSTATE WASHDC PRIORITY 2850
INFO RUCNRAQ/IRAQ COLLECTIVE PRIORITY

C O N F I D E N T I A L SECTION 01 OF 02 BAGHDAD 002752 
 
SIPDIS 
 
SIPDIS 
 
E.O. 12958: DECL: 08/19/2017 
TAGS: ECON ENGR EPET KCOR EIND IZ CH
SUBJECT: PRT TIKRIT: CHAIRMAN OF OIL MINISTRY IRAQ-CHINA 
COMMITTEE VOICES DISSATISFACTION WITH CHINESE TACTICS 
 
Classified By: PRT Team Leader Steven Buckler for reasons 1.4 (b) and ( 
d) 
 
¶1. (U) This is a PRT Tikrit, Salah ad Din cable. 
 
¶2. (C) SUMMARY.  During an August 6 meeting in Bayji, Abdel 
Khader Sabah, the chairman of the Iraq-China Committee for 
the Ministry of Oil (MoO), claimed that the China National 
Petroleum Company (CNPC) is reneging on agreements made in 
earlier conferences with respect to training and development 
programs for Iraqi engineers.  Khader, the North Refinery 
Director (and former Director General of Production), 
described the CNPC as "always hungry" and stated that the oil 
conglomerate was aggressively lobbying the MoO for permission 
to conduct extensive research at the Jawan field - without 
Iraqi participation.  A confidential memorandum addressed to 
the Chairman of the Supervisory Committee of the MoO from the 
Iraq-China Committee provided by Khader to IPAO implores the 
Ministry to take a stronger stance vis-a-vis the CNPC through 
formal diplomatic channels.  Khader said that this was 
unlikely to happen due to payoffs being made by the CNPC to 
Shahristani and other decision makers in the MoO.  END 
SUMMARY. 
 
---------------------- 
A Long Awaited Meeting 
---------------------- 
 
¶3. (C) Khader serves along with two other members as the 
Chairman of the Iraq-China Committee, the principal vehicle 
for coordination of technical issues between the Ministry of 
Oil and the Chinese National Petroleum Company.  On July 
22-26 the Committee held a series of meetings ) coupled with 
a visit to the Chinese Geophysical Institute - with their 
Chinese counterparts in Beijing.  The session was the fourth 
in a sequence dating from November 8, 2005, and the first 
since November 2006.  Khader claimed that the Chinese had a 
history of canceling meetings, i.e. the July conference was 
originally scheduled for February. 
 
--------------------------------------------- - 
Chinese Interest Strong in Jawan, Faqaa, Imara 
--------------------------------------------- - 
 
¶4. (C) Khader depicted Chinese interest in the Jawan fields 
(a prospective field in Nineveh province described as "close 
to producing" by industry sources) as extremely strong. 
Although the Iraqi delegation arrived in Beijing expecting to 
discuss training and development opportunities, the CNPC 
devoted most of the four day session to negotiating 
logistical support for expanded geological study of the Jawan 
area by a Chinese-only team.  According to Khader, the CNPC 
officials told the Iraqi attendees that Iraqi technical 
participation in the study was not necessary; instead they 
would be sent a report upon completion of the study.  Khader 
attributed the exclusion to a Chinese desire to protect 
sensitive information. 
 
¶5. (C) The memorandum mentions Chinese interest in sending 
technicians to study the Faqaa and Imara fields (located to 
the south of Baghdad).  Study of the horizontal field in As 
Siniyah (located near Bayji) is noted as a future objective 
of the CNPC. 
 
--------------- 
No Quid Pro Quo 
--------------- 
 
¶6. (C) The Chinese initially made a robust offer to train and 
develop Iraqi engineers and technicians via studies of 
potential Iraqi oil fields.  However, such assistance did not 
materialize.  The marked change in the Chinese approach is 
noted in the report as occurring after the "securing" of the 
Ahdab field, a potentially lucrative field located in Wasit 
province labeled by industry sources as a long-term prospect. 
 According to Khader, this field was promised to the CNPC for 
future development by Shahristani in 2006 after the 
hydrocarbon law passage in exchange for "payments", a subject 
about which he declined to elaborate further upon.  (NOTE: 
This is the only allegation of possible Chinese payments for 
future oil contracts we have heard in Salah ad Din.  The PRT 
will continue to investigate this issue and report any/all 
findings which may corroborate or contradict its veracity. 
END NOTE.) 
 
¶7. (C) The CNPC provided the Iraqi delegates with a tour of 
their Geophysical Institute (located about 100 kilometers 
from Beijing according to the report), the facility where 
Iraqi engineers will eventually be trained.  Khader 
highlighted the tour as an example of Chinese intransigence: 
the Iraqi trainees will only be taught outmoded techniques on 
antiquated equipment while CNPC engineers receive more up to 
 
BAGHDAD 00002752  002 OF 002 
 
 
date training. 
 
------------------------------------- 
Khader Tags Oil Ministry Unresponsive 
------------------------------------- 
 
¶8. (C) Khader doubted that the Ministry of Oil in Baghdad 
would take real action to "act in the interests of the Iraqi 
people", despite strong recommendations by the report which 
call for diplomatic protests (both via notes and meetings) to 
the Chinese Ministry of Foreign Affairs and the CNPC.  Khader 
added that this action was unlikely because the Minister of 
Oil and his important subordinates are handsomely rewarded 
for their cooperation with the CNPC. 
 
¶9. (C) Apart from the report, Khader claimed that the 
Ministry was not encouraging development of oil fields in 
Salah ad Din because of sectarian bias.  Khader drew 
attention to the lack of sufficient investment in the Bayji 
oil refinery as an example of Baghdad's neglect. 
 
------- 
Comment 
------- 
 
¶10. (C) Abdel Khader tends to embellish tales of woe, 
particularly in respect to sectarian issues.  However, Khader 
may offer a valuable window into the nature of the 
Iraqi-China relationship, especially concerning potential 
newfound opportunities to China promised by the hydrocarbon 
law.  Continued development of this relationship will remain 
a high priority of the PRT.  END COMMENT. 
 
¶11. (U) For additional reporting from PRT Tikrit, Salah ad 
Din, please see our SIPRNET reporting blog: 
http://www.intelink.sgov.gov/wiki/Tikrit. 
 
CROCKER