10.3  |  Reconstruction: oil, commercial interests, debt relief, asylum and stabilisation policy

to the Supreme Oil and Gas Council, to direct their work to develop detailed policy

recommendations.249 The official summarised those guidelines as:

“Upstream Policy

• An independent, public, Iraqi National Oil Company (INOC) should be

re‑established … to manage current fields and refineries.

• Foreign investment (combined where possible with domestic private capital)

should finance the development of new fields and refineries. Joint public/private

operations should be avoided except where necessary as an interim measure

before full privatisation.

Downstream policy

• INOC to rehabilitate existing refineries.

• Foreign and domestic private investment to finance major refinery expansions

and new refineries.

Marketing

• Gradual and methodical privatisation of domestic wholesale and retail

marketing.”

435.  Prime Minister Allawi met Mr Blair in London on 19 September.250 Prime Minister

Allawi said that he was pursuing a four-part strategy which addressed:

• the political process;

• the economy, including meeting investment needs in the oil sector;

• security (his personal focus); and

• building up the institutions of government.

436.  Mr Blair, Prime Minister Allawi and several Iraqi Ministers discussed reconstruction,

the economy and other issues over lunch.251 Prime Minister Allawi stressed the need for

a generous debt reduction package that would encourage foreign investment.

437.  In late 2004, the FCO agreed to fund a small consultancy team to assist the

Ministry of Oil to “create a stable petroleum contracts regime and a modern, transparent

and efficiently run Iraqi National Oil Company (INOC)”.252 The project built on the

249 Email FCO [junior official] to FCO [junior official], 8 September 2004, ‘PM’s Guidelines on Petroleum

Policy – Summary’.

250 Letter Sheinwald to Adams, 19 September 2004, ‘Iraq: Prime Minister’s Meeting with Prime Minister

Allawi, Sunday 19 September’.

251 Letter Quarrey to Owen, 19 September 2004, ‘Iraq: Prime Minister’s Lunch with Allawi, 19 September’.

252 Paper FCO, [undated], ‘Terms of Reference: Assistance in creating a stable petroleum contracts regime

and a modern, transparent and efficiently run Iraqi National Oil Company (INOC)’.

439