Graduation Year

Spring 2012

Document Type

Open Access Senior Thesis

Degree Name

Bachelor of Arts

Department

International Relations

Reader 1

Kristin Fabbe

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© 2012 Chase W. Gray

Abstract

In the absence of a continued military presence in Iraq, the United States must use alternative means to achieve its foreign policy goals. Stated goals include maintaining influence, increasing stability in Iraq, Iran, and the Arabian Peninsula, and ensuring Iraq's territorial integrity. This paper suggests leveraging the power of American oil and gas firms operating in Iraqi Kurdistan given the relative ineffectiveness of the embassy in Baghdad and the hostility many Iraqis exhibit toward American diplomats. It first outlines American policy toward Iraqi Kurdistan from the end of the Gulf War to the present. Next it provides a brief overview of the current state of affairs in Iraqi politics and Iraq's oil and gas industry. Then the paper describes four specific ways in which supporting American oil and gas firms in Iraqi Kurdistan can help the United States achieve its foreign policy goals. First, it can check undue Shi'a centralization of power and keep Iraq from drifting too far into the Iranian sphere. Second, it can strengthen the Kurdish bargaining position with Baghdad and push Iraq toward resolving the status of Kirkuk and enacting a comprehensive hydrocarbons law. Third, oil and gas extraction through profit sharing contracts (PSCs) rather than technical services agreements (TSAs) would promote foreign direct investment and spur economic growth. Finally, private sector oil and gas companies could be a critical component in maintaining American influence with the Kurdistan Regional Government (KRG) and the Government of Iraq (GOI) through their strong local ties. The last chapter is devoted to policy prescriptions for achieving the aforementioned goals.

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