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PART 2: Ali Khedery on Iraq, Kurdistan, ISIS and oil

Ali Khedery is chairman and chief executive of Dragoman Partners LLC, an international strategic advisory firm.
Ali Khedery is chairman and chief executive of Dragoman Partners LLC, an international strategic advisory firm.

By Shaho Amin

These days Ali Khedery is chairman and chief executive of Dragoman Partners LLC, an international strategic advisory firm. But he may be better known as the longest continuously serving American official in Iraq.

Khedery was special assistant to five American ambassadors in Iraq and senior adviser to three chiefs of US Central Command from 2003 through 2010. 

Later, he was chief political negotiator Exxon Mobil's entry into the Kurdistan Region. Earlier this year, he spoke to Rudaw’s Shaho Amin.

I want to move to another subject still remaining in Iraq. As regarding Kurdistan, there are two different opinions in the American administration. For instance, the Pentagon has quite frankly considered independence for Kurdistan. On the other hand, the foreign ministry of America insists of the unification of Iraq and does not support Kurdistan becoming separate from Iraq. Why these different views?

I haven’t heard that analysis before. But, frankly, there is one opinion that matters in the end of the day and that is the policy of the president of the United States. The current American policy simply supports a united Iraq and a strong central government in Iraq. I don’t necessarily agree with that policy, I don’t think it’s grounded in reality based on the de facto partition you see on the ground in Syria or in Iraq, but that is the American policy. 

Do you think US will support Kurdistan to become independent?


No, why?

You should ask the American Embassy and the White House. I believe they are afraid of unintended consequences; where the borders of Kurdistan would be [in the event of] an Arab-Kurdish war, or a Turkish-Kurdish war or an Iranian-Kurdish war. I think that they believe the current situation is messy enough, bloody enough, and they don’t want any more complications.

What if Kurds insist? For example, Israel in the beginning became an independent country and faced lots of difficulty, but finally they were able to make a strong country and even America was not supporting them very much in the beginning. 

This is where I have a personal request from the people of Kurdistan. There are things that Kurdish citizens can do to help us, friends of Kurdistan, help the people of Kurdistan. 

You must fight corruption. You must continue to support democracy. You must continue to welcome Arab refugees. You must welcome the Christian population and protect them. Welcome Yezidis as well. 

Continue to do all of the wonderful things that Kurdistan has done so far. Continue to fight divisions internally between political factions [the] KDP and PUK and Goran. Unite as a people, continue stability, continue your prosperity. That will enable us advocates of Kurdish self-determination to help say, look, this is an example of success. 

It’s the only example of success from the Iraq War, where, as President Barzani likes to say, not a single American soldier was killed or wounded. So the Kurdish people and the Kurdish leadership could continue to build this wonderful thing you have built so far.

And that will, over time, give us in the international community an opportunity to continue strengthening you. I would have not been able to convince the president of the Exxon Mobile to come to Kurdistan, had there not been security.

Let me ask you about the ExxonMobil. What was your role in bringing them to Kurdistan? And why did ExxonMobil choose to invest in Kurdistan, not in Iraq? 

I have to say, I have to admit, that my being able to negotiate ExxonMobil’s entry to Kurdistan was I believe my greatest professional achievement in my life. It’s something I‘m very proud of. And there are several reasons for that. 

First, it’s important to remember that Exxon was invested in Basra. It was very happy to be there. But the situation in Baghdad was deteriorating at the time and I just left the American administration, I had resigned in protest. Because, again, after I failed to convince the White House to move away from prime minister Maliki, I did not believe I could stay in the US government and be part of a policy that would ultimately bring back Al Qaeda or Daesh in Iraq and strengthen the Iranians. 

We had a legal obligation to our shareholders, the ExxonMobil shareholders, to do the best for that company and their shareholders. I did not believe that America’s largest oil company worth $500 billion could operate in Basra over the long term because of Asaib, Katieb, Badr and other militias which have always threatened Americans and would very certainly threaten the largest American oil company if there was ever a conflict between them or Iran or United States. 

They view an American oil company as an extension of the US government. So I told the CEO of ExxonMobil, I said look, there is another part of Iraq which you should think about investing. Don’t leave Basra entirely, don’t abandon Baghdad entirely, what you should do is balance your risk. This is what we are paid to do as business executives. 

So, I was able to contact his Excellency President Masoud Barzani and Dr Fuad Hussein, Dr Ashti Hawrami and Dr Barham Salih who was prime minister at the time. And we were able to negotiate a deal that allowed ExxonMobil to enter Kurdistan.
But again the only reason why Exxon and then Chevron and Total and Gazprom now are willing to look at Kurdistan and considering investing billions of dollars is because Kurdistan was safe, stable, the people of Kurdistan did not want to harm foreigners, they provided stability for investment and that is exactly what you need.   

Why was it [former prime minister] Maliki could not convince ExxonMobil not to invest in Kurdistan? I would like to know your opinion on that question.

Once we had signed the deal with the Kurdistan Regional Government, no one could stop it. ExxonMobil and the United States are not Russia and [state-owned] Rostneft, for example. The White House cannot interfere in a contractual decision once the contract has been signed. 

As again, world’s largest public energy company went to an exhaustively legal review to make sure that we would never do anything illegal. And so we studied the Iraqi constitution and studied the Kurdish oil law. I was somebody who sat around the table in Baghdad with President Talabani and President Barzani and others we sat together to draft the Iraqi constitution in 2005. 

So I knew what the constitution said and I knew also the deal that was done in the backrooms. So I knew the full spirit of the constitution allowed for the Kurdistan region to draft and pass its oil law and I knew that oil law under the constitution superseded federal law.

And so Kurdistan had the full right to sign the contract with ExxonMobil, with Chevron, with Hess, with Hunt, with DNO and Genel and everybody else. So we went to those legal reviews. Our Exxon lawyers agreed. Our external lawyers agreed.  

And that is when we finally signed the contract and so prime minister Maliki [was] upset with the reaction, but frankly he should not have been. Because we told him we would sign with Kurdistan, President Barzani told him that we would go to sign, he was not surprised. 

He pretended to be surprised, but we were transparent all along. The president was, we were, and so prime minister Maliki’s response, frankly, was just a continuation of his failed policies. He could have used Exxon doubling investments in Iraq because it was invested in Basra and   was expanding in Kurdistan. 

He could have and he should have used that opportunity to unite the country. He should have said I welcome my brother Masoud Barzani getting the world’s largest oil company doubling its investments in Iraq. I welcome the world’s largest oil company investing in my country, because Kurdistan is part of Iraq. I welcome the increase of revenues which will benefit all of the Iraqis.  

Because we agreed with the Kurdistan Regional Government that all of the money would flow back to Baghdad and Kurdistan would receive its 17 percent. 

Now, I would like to know your opinion about the policy that the Kurdish Regional Government uses in the oil industry?

I think, I know, some parts of the Kurdistan Regional Government are criticized heavily by the people. But frankly I would urge the people if Kurdistan to rethink this. While the policy has not been perfect, it has been extraordinary and really historic. Since 2006 or 2007, really, the Kurdistan region has been able to attract billions and billions of dollars of investment in the oil and gas sector. It has been able to sign contracts with first small companies, then the medium companies, and then the world’s largest companies. 

You have gone from producing zero barrels a day to almost half a million barrels a day now or more than half million barrels a day if you include Kirkuk. I think, frankly, that Dr Ashti Hawrami deserves a lot of credit and people need to know he is a very tough negotiator. 

I had many arguments with him frankly during negotiations to try to get better terms for ExxonMobil and he refused and he got a very good deal for Kurdistan, for Iraq, that maximized the amount of money that Kurdistan in Iraq would get and at the same time the fair contract to enable ExxonMobil to invest and if it finds oil to be able to benefit from that contract. Because it’s a company and it is there to make profit in addition to invest in that country. 

In the last part of the interview, I would like to know about American policies in Iraq. Why didn’t Barak Obama support Mr Talabani to become the president of Iraq and what was the [Masoud] Barzani’s role in that negotiation?

Thank you for asking, that’s a very important question. You know, I have had the great pleasure of knowing both President Barzani and president Talabani since the early days of the war. Because I was Ambassador [Paul] Bremer’s liaison to the governing council which both Presidents Mr Talabani and Mr Barzani were members of. 

So I was able to see the role they played the historic the important positive role they played in the governing council. And the various other historic moments, the formation of the Allawi government. The drafting of the constitution during the civil war. 

You know, I called with Ambassador Crocker and General Petraeus, we called President Talabani, we called President Barzani when Maliki was down in Basra and he was almost killed by the Jaish al Mahdi and we said please support Maliki because this is the very important situation. You can’t have the prime minister of Iraq killed. And you need to support him politically. They had differences at the time but they still supported him. 

By 2010, the Obama White House had made a decision that they wanted Nouri Maliki to stay as prime minister but because Ayad Allawi and Iraqiya had won the elections they wanted to give the presidency to Dr Ayad. Somebody I respect and admire very much as I know President Talabani and President Barzani do. And they wanted to give the speakership of the parliament to a Kurd. 

I had a very heated series of arguments, really confrontations, with my friends at the embassy, the generals and the White House and I told them this was a very bad decision because President Talabani is a historic figure. He is a historic leader of the Kurdish people and it was impossible to imagine that a phone call from a man in Washington even if it was the President of the United States to President Talabani would get him to step down as the President of the country. Imagine. 

It was impossible to imagine President Barzani abandoning a fellow historic leader like President Talabani. So I lobbied very hard…

What was Barak Obama’s point to not support Mr Talabani?  

The argument that some of my colleagues made was that President Talabani was too old, he was in poor health, he was growing increasingly closer to Maliki, rather to the Iranians. And that he was sort of endangering both Kurdish interest and Iraqi interest and American interests. 

Again, I just disagreed, having known him for as long as I did. And I felt, most importantly, that it was going to be impossible to get him to step down. So you shouldn’t begin a fight, knowing you are going to lose. 
So I had a long series of arguments to the American Ambassador General Lloyd Austin, Tony Blinken, the vice president’s national security advisor who is now deputy secretary of state, and I said, you are wrong, you do not understand the situation in Kurdistan, you don’t understand the situation in Baghdad. President Talabani cannot and should not be made to step down, I lost the argument. 

How do you see Iraq without the role of President Talabani?

Look, I am very well known to have not always agreed with President Talabani. We have not always had an easy relationship. But at the same time, he is a historic figure. And he played a very important role in Baghdad to help unite the country. To help unite the Kurds and the Sunnis and the Shiia, during the most difficult days. 

So, again, while I did not agree with what he did, I think his role is being felt today. I think the polarization of the society and the breakdown of justice and the rule of law in Baghdad is one of the effects that the absence of Jalal Talabani has had. 

I would like to know about the American administration, particularly since the war with Daesh has started. Who is the main character for America to deal with regarding the issues in Iraq and Kurdistan?

The personal representative of the President of the United States is the American Ambassador Stuart Jones, who I worked with several years ago. He is a professional diplomat. He is a good man. And I’m sure he will fairly represent whatever Washington’s policy might be. He is the representative of the United States in the country.

How about Masoud Barzani the president of the Kurdistan region? Some people believe that America directly deals with him over main and most strategic issues nowadays.

Again, the roe of the American Ambassador is to speak with everybody. His role is to speak with all the Kurdish leaders, KDP, PUK, Goran. His role is to speak with all the Sunni groups that are not affiliated with Daesh or Qaeda…

But Barzani’s role is not only the leader of a political party, he is the president of the region.

President Barzani and Mulla Mustafa Barzani are great historic figures in Kurdish history and in Iraqi history and in Middle Eastern history. 

Again, I think both men have showed remarkable wisdom and leadership over the years and I’m quite certain that they will be remembered by the Kurdish people much like Sheikh Zayed, the founder of United Arab Emirates, is remembered.

I have enormous respect for both Mulla Mustafa and Kak Masoud. The reality I, as I said, American officials whether it’s the president, the vice president, the American Ambassador all deal and have dealt with and should continue to deal with President Barzani, President Talabani and the other Iraqi leaders in Baghdad. We must deal with all Iraqis fairly. 

So, you have been with both Kurdish leaders in Iraq. I will take the opportunity to use the last minute to hear from you something which was quite unique aboutn the two leaders in Iraq  that you were made aware of in the your meetings with them.

Again, I think that critical moment in history, there are so many, but the critical moment in history was in 2010. When President Obama, I think unwisely, called President Talabani and asked him to step down. And he refused. He should have refused. 

And then President Barzani was called and asked to abandon President Talabani and he refused and I just don’t think that it’s appropriate for the United States to with a telephone call attempt to change world leaders when the people of those countries support them so strongly.
You know, democracy is people deciding who they want to lead them and we have to respect that, whether we like these people or not.   



Remo K
Remo K | 10/5/2015
Ali, you should write your memoirs into a book about this most turbulent period of Iraq and Kurdistan. One day, the historians may refer to it. I would be the first to buy it.
Adstar | 10/5/2015
This has been the best interview i have seen carried out by Rudaw Very informative indeed..
Rebaz | 10/5/2015
Very very interesting articles! I red both parts with much pleasure! What mr. Khedery should do, is righting a book about all those events since he entered iraq until the end of his role in Iraq. Thank you Rudaw and Mr. Ali Khedery
FAUthman | 10/5/2015
If you do not think this interview is very significant, even historic, and you are not aware of the very positive contributions to Kurdistan that were made by this very smart man, an Iraqi American, in the years after the 2003 war, you must be living on another planet!!

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