GOP Senate Candidate Pushed Oil Deal Detrimental To U.S.-Iraq Policy
At the same time that he was officially a candidate for the United States Senate, Colorado Republican Bob Schaffer was helping to arrange a major oil deal in the Kurdish region of Iraq that government officials said would damage U.S. interests in that country.
Schaffer has claimed that he was unaware that the company he was aiding, Aspect Energy, was undermining American policy by pursuing an oil contract in Kurdistan. But a review of press reports from that time period suggests that such an explanation is either highly unlikely or downright disingenuous.
Indeed, just months before Aspect's subsidiary reached an agreement to work on a 104-square-mile plot of land, President Bush, the State Department and Iraqi officials were all publicly expressing concerns that such arrangements would destabilize the Iraqi government.
"Four years before Bob Schaffer went to Kurdistan, he voted to authorize the Iraq War where he had to have learned about the conflict between the Kurds and the Iraqi central government," said Tara Trujillo, spokeswoman for Democratic U.S. Senate candidate Mark Udall. "Two months before Bob Schaffer went to Kurdistan to negotiate an oil contract, the Kurds threatened to separate from Iraq because of oil... One month before Aspect Energy signed the deal, the U.S. State Department officials also told the press that these types of oil deals would counter our national security interests. How could Bob Schaffer not know? It's not that Bob Schaffer didn't know his actions would undermine the fragile situation in Iraq, it's that he didn't care."
Schaffer initially traveled to Iraq in November 2006 to lay the groundwork for an oil deal in the Kurdish regions for Aspect, his former employer. Because the Iraqi government, at the time, was working out a tenuous oil revenue-sharing arrangement, U.S. officials worried that such dealings would provoke unnecessary complications. The nonpartisan Government Accountability Office reported that the Iraqi government viewed foreign deals like the one Aspect was arranging as "illegal."
And yet Schaffer claims now to have been unaware of this diplomatic pothole. In a comment to a local Colorado paper, the former Congressman claimed that at the time of his visit, he had no knowledge that the State Department was warning oil companies not to strike deals with the Kurdistan Regional Government.
"We didn't experience any discouragement," he said.
If that is the case, however, Schaffer is acknowledging that he paid relatively no attention to the industry in which he was operating. Two months before Aspect finished its controversial deal, Hunt Oil signed its first big contract with Kurdistan.
Moreover, President Bush was asked about that agreement in September 2007, and expressed concern that it would "undermine" a possible oil revenue sharing plan and America's political efforts in Iraq.
"Our embassy also expressed concern about it," said President Bush, whose sincerity in opposing the deal has been seriously questioned. "I knew nothing about the deal. I need to know exactly how it happened. To the extent that it does undermine the ability for the government to come up with an oil revenue sharing plan that unifies the country, obviously if it undermines it I'm concerned."
Shortly thereafter, the New York Times wrote a comprehensive piece on the matter, entitled "Official Calls Kurd Oil Deal at Odds With Baghdad." In it, a U.S. official was quoted saying: "We believe these contracts have needlessly elevated tensions between the [Kurdistan Regional Government] and the national government of Iraq."
Throughout that time period, Iraqi officials, including the country's oil minister, were expressing fears that Kurdish oil ambitions would result in open political conflict within the Iraqi state.
Additionally, the State Department wrote a letter to Congress stating that any contract signed between a foreign energy company and the Kurdistan Regional Government would elevate tensions.
"We have expressed the same concerns to all companies that have contacted the U.S. Government about investment in Iraq's oil sector," the State Department letter read. "We have also made the point publicly several times over the last year."
Schaffer's office did not return request for comment.
What makes the issue so damaging, critics allege, is not just that Schaffer is claiming he was unaware of the concerns of the President, State Department and Iraqi officials, but that he was doing this all at the same time that he was officially running for Colorado's Senate Seat.
"It is either incredibly stupid or incredibly devious," said Pat Waak, chair of the Colorado Democratic Party. "From my point of view, most candidates for office go through and do their own research on themselves to see what might be a conflict of interest so that they can divest themselves or have a plausible answer for that. And what he simply says is: 'I didn't know.' Well how is that possible?"
Indeed, in May 2007, Schaffer filed his statement for candidacy. A month after that, he hired a campaign consultant and began actively raising money. Only five months later did he help finalize the Aspect Energy contract. For this effort, he earned a $226,000 severance package from Aspect in 2007, according to financial disclosure forms.
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First Posted: 07-11-08 09:48 AM | Updated: 07-19-08 05:12 AM