THE OIL ESTABLISHMENTS IN SELECTED PRODUCING COUNTRIES.

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T00875R001500200014-5
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 83
• Document Creation Date: December 9, 2016
• Document Release Date: April 12, 1999
• Sequence Number: 14
• Publication Date: November 1, 1974
• Content Type: REPORT

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Secret
The Oil Establishments in Selected
Producing Countries:
A Compilation of Articles from
Inter rational Oil Developments
No Foreign Dissent
Secret
ER H 74-3
November 1974
Copy N2 288
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NATIONAL SECURITY INFORMATION
Unauthorized Disclosure Subject to Criminal Sanctions
Classlfird by 005139
Exempt from General Declassifirat;on Schedule
of E.O. 11652, exemption category:
?5D(1), (2), and (3)
Automatically eclc-??fled on:
dota imposs,Sl0 to determine
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Secret
No Foreign Dissem
These articles have been presented in Iuternatio,ral Oil Developments during,
the past three months to shed light on personalities, institutions, and policies in
selected producing countries. They are brought together here as a convenience to
readers of the IOD.
Since these articles were prepared, the following events have occurred:
In Iraq Dr. Sa'dun Hammadi has become Foreign Minister and Tayid
'Abd al-Karim has been made Minister of Oil and Minerals.
In Saudi Arabia both Minister of State for Foreign Affairs, Umar
Saqqaf, and the Governor of the Sauui Arabian Monetary Agency, Anwar
Ali, have died; no replacement has been announced for either.
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Page
Algeria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Ecuador . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Indonesia . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Iran . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Iraq . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Kuwait . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Libya . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Nigeria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Qatar 49
Saudi Arabia . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
United Arab Emirates . . . . . . . . . . . . . . . . . . . . . . . 61
Venezuela 69
25X6
Norway 93
W
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No Foreign Dissem
OPEC COUNTRIES
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Secret
No Foreign Dissem
ALGERIA
Algerian oil policy is determined, in general terms, by Houari Boumediene,
self-appointed President of the Council of the Revolution and President of the
Council of Ministers. Because the constitution is largely ignored, executive and
legislative power is vested in these two bodies. The Council of Ministers runs the
government, but with only five or six of the 23 members making the key decisions.
Belaid Abdesselam, Minister of Industry and Energy, is concerned most directly
with petroleum policymaking. SONATRACH, a state corporation under his
Ministry, is the operating unit for all petroleum matters. The Ministry of Finance
plays a role in determining petroleum tax policy. It has often attempted, without
success, to control SONATRACH expenditures.
Key petroleum issues, such as Algeria's position on questions before OPEC,
are decided by Minister Abdesselam in consultation with President Boumediene.
Despite evidence that the minister has been more outspoken and unequivocal than
Boumediene would have preferred, the president has given him increasing
responsibility to speak on energy matters. Policy on minor questions is set by
President Ghozali of SONATRACH or his subordinates.
The state controls all phases of the oil and gas business through SONATRACH.
Created in 1963 to supervise construction of an oil pipeline, the corporation has
expar :ed its activities to include exploration, production, transportation, and
marketing of petroleum (including natural gas), as well as construction and
operation of refineries and petrochemical complexes.
Algeria can absorb large revenues in advancing its ambitious development
program, servicing the foreign debt, and expanding state services. The government
consequently has tried to maximize petroleum production and has been a leading
advocate of price hikes. Until recently, Algerian oil was overpriced. The country
has now reduced its prices to more competitive levels but will resist further cuts --
probably supporting an OPEC-wide agreement to cut production, if necessary.
(Secret No Foreign Dissem)
Houari Boumediene
President
Col. Houari Boumediene has served as President of Algeria since he overthrew
Ahmed Ben Bella in June 1965. In theory, Algeria is governed by a collegium,
the 14-man Council of the Revolution; in fact, Boumediene dominates the
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ALGERIL.,: Petroleum Policymaking Organization
President
Houari BOUMEDIENE
Ministry of Industry
and Energy
Belaid ABDESSELAM
Council of the Revolution
and Council of Ministers
SONATRACH
President-Director General: Ahmed GHOZALI
Minister of Finance
Smail MAHROUG
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government. A nationalistic revolutionary, the president has mellowed in office.
Realizing that Algeria needs technical aid and export markets, he has suppressed
his extremist ideological beliefs. Boumediene has nationalized the major Algerian
industries and is committed to an unpopular program of agrarian reform. Meanwhile,
he has also dealt willingly with Western banking institutions and technical advisory
firms. In February 1971 he commented that "You cannot feed people with fine
speeches. What they need is bread, shoes, and schools."
Boumediene's foreign policy is oriented toward the Mediterranean and the
Eastern Arab nations and shows strong sympathy with the Palestinian cause. The
president severed diplomati.; relations with the United States in June 1967 after
the Arab-Israeli war. He argues that the world is now polarized between the
developed and undeveloped nations. Host to the September 1973 Nonaligned
Summit Conference, he emerged as a major Tl,;rd World leader. The economic
resolutions of that conference and the recent oil embargo led him to request the
Apr.: 1974 Special Session of the UN General Assembly on raw materials, which
lie addressed. (Secret No Foreign Dissem)
Belaid Abdesselam
Minister of Industry and Energy
An outstanding technocrat and one of the most
able men in the government, Belaid Abdesselam is
among Algeria's principal economic policy makers.
He rose to prominence as chief negotiator in
prolonged petroleum negotiations with France
during the early 1960s, and by 1964 he was one of
Algeria's principal authorities on petroleum. He
assumed his current post in 1965 after serving two
years as president of SONATRACH.
technical skills. He played an important role in negotiating the 1969 contract between
SONATRACH and El Paso Natural Gas to supply LNG to the United States.
Abdesselam believes that Algeria's development
requires cooperation with the West. Even after the
1967 break in diplomatic relations with the United
States, Abdesselam favored the use of American
A frequent participant in meetings of international petroleum organizations,
Abdesselam was one of the ;first to suggest that Arab oil producers agree to prorate
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production to drive prices up. Algeria supported the October 1973 OAPEC oil
embargo. In November 1973 Abdesselam and Saudi Arabia's Minister Yamani were
selected as spokesmen for OAPEC, circling the globe to explain the Arab position.
(Secret No Foreign dissem)
Smail Mahroug
Minister of Finance
A highly regarded economist and financial
authority, Smail Mahroug has made his name in such
international forums as the World Bank conferences
on reforming the world monetary system. He is not a
member of Algeria's circle of top policymakers,
however, and wields less influence than Minister of
Industry and Energy Belaid Abdesselam. Mahroug is
frequently in conflict with Abdesselam and others
over SONATRACH's spending policy. Speculation
that Mahroug will be dropped from the Cabinet has
been common for at least two years.
Mahroug holds strong socialist views. In 1969
he criticized the US aid program as a tool to
strengthen the US position in less developed
countries. He does, however, respect US technical expertise and fosters US cooperation
in Algeria's economic development. Mahroug played an important role in the
negotiations between his government and the Export-Import Bank on a loan in 1973
for the El Paso Gas project. (Secret No Foreign Dissem)
Ahmed Ghozali
President-Director General, SONATRACH
Ahmed Ghozali and Belaid Abdesselam, Min-
ister of Industry and Energy, have been Algeria's
chief spokesmen on petroleum matters since the
mid-1960s. As the head of Algeria's oil and gas
industry, Ghozali has more power than most
members of the government. He is not a member of
the inner circle of decisionmakers but has earned
their respect as a competent, hardworking tech-
nician.
Ghozali has a degree in engineering from I'Ecole
des Pouts et Chaussees de Paris. He makes excellent
use of the competent economists on his staff.
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An experienced negotiator, Ghozali has participated in oil and gas negotiations
with US firms since 1963. In New York, on 9 October 1969, he signed the first basic
agreement between SONATRACH and the El Paso Natural Gas Company for the
purchase of 1 billion cubic feet per day of Algerian liquefied natural gas.
He admires American businessmen, whom he regards as tough but honest partners.
Ghozali has few friends because of his heavy workload; he is totally involved with the
oil and gas problems. (Secret No Foreign Dissem)
Nourredine Ait Laoussine
Vice President, SONATRACH
An official of SONATRACH since 1965, Nourredine Ait Laoussine has been
second in command for several years. He is currently head of marketing and
exploration. He holds an M.A. in petroleum engineering from the University of
Michigan. An executor rather than a maker of policy, he is an excellent
administrator. It is Ait Laoussine to whom SONATRACH President Ghozali turns
for details during meetings and to whom he entrusts the solution of management
problems. Ait Laoussine is married to an American woman, which has been a
disadvantage in his career.
Ait Laoussine has been involved in most of the negotiations between
SONATRACH and US firms. In that capacity, lie has testified before the Federal
Power Commission on several occasions. He is a tough negotiator but is pleasant
even when presenting an uncompromising position. Ait Laoussine has a great
appreciation for the technical expertise that US firms have to offer igeria's
developing petroleum industry. (Secret No Foreign Dissem)
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Petroleum policy in Ecuador has been determined by the President of the
Republic, General Guillermo Rodriguez, and by the ministerial cabinet since the
advent of military government in February 1972.
Decisions on oil policy are based on recommendations by cabinet members,
chiefly the Minister of Natural Resources and Energy and the Minister of Finance.
The procedure depends on the importance of the issue. Minor policy matters may
be decided by the Minister of Natural Resources. more important decisions require
a consensus of the cabinet, and all decisions mus. be coordinated with the President.
Major policy matters are decided by the President.
The Minister of Natural Resources and Energy, Navy Captain Gustavo Jarrin,
drafts most proposals for oil policy with little input from ministry subordinates.
Jarrin's recommendations weigh heavily in the final presidential decisions. Major
decisions on fiscal matters such as oil company tax rates and budgeting of oil
revenues are based on recommendations from the Minister of Finance, Jaime
Moncayo.
The Ecuadorean State Petroleum Corporation (CEPE) is the principal entity
for administering national oil policy. CEPE was created in 1972 and eventually
is supposed to engage in oil production and refining. So far, lack of technical
expertise has limited it to regulatory activities and domestic marketing o; petroleum
products. CEPE recently purchased a 25% share of the operations of Texaco-Gulf,
Ecuador's only important producer, and plans to build a 50,000-b/d refinery in
the near future. Quito has expressed interest in expanding its ownership of oil
company operations to 51% by the end of 1975.
Ecuador, the smallest and newest producer in the OPEC group, seeks high
oil revenues through high prices and a large government take rather than by
maximizing production. Revenues per barrel of exports currently amount to
$10.35 - among the highest in OPEC. Royalty rates of 16%, a profit tax of 45`I%,
an export tax of 15%0, and various other taxes return more than. 90% of the selling
price to the government. In June the government introduced an oil conservation
policy because discovery of new reserves has not kept pace with expectations.
(Confidential)
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ECUADOR: Petroleum Policymaking Organization
Head of the Military Government
General Guillermo RODRIGUEZ Lara
Minister of Natural Resources and Energy Minister of Finance
Captain Gustavo :ARRIN Ampudia Jaime MONCAYO Garcia
Ecuadorean State Petroleum Corporation
Manager: Lt. Col. Rene VARGAS Pazzos
Department of Hydrocarbons
Director: Guillermo BIXBY Garcia
Gustavo Jarrin Ampudia
Minister of Natural Resources and Energy
A navy captain and former Chief of Staff
of the Ecuadorean Navy and assistant naval
attache in Washington, Gustavo Jarrin has been
Minister of Natural Resources and Energy since
February 1972. Jarrin is considered a well-
motivated and capable officer. He is a tough-
-minded nationalist who has taken a hard line
with foreign concessionaires. He is the man
most immediately responsible for petroleum
policymaking, but all decisions must be cleared
with President Rodriguez. Jarrin is Ecuador's
official representative at meetings of OPEC and
other energy organizations. (Confidential)
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Lt. Col. Rene Vargas Pazzos
Manager: Ecuadorean State Petroleum Corporation (CEPE)
A technical engineer and former assistant
military attache to Washington, Rene Vargas is
concerned with the implementation of Ecua-
dor's petroleum policy. He plays a very small
role in policy decisionmaking. (Confidential)
Guillermo Bixby Garcia
Director: Department of Hydrocarbons
A former professor, Guillermo Bixby is an
ab;e geologist who was appointed to his present
position in early 1972. As head of one of the
departments within the Ministry of Natural
Resources, he finds himself overshadowed by
Minister Jarriri. He serves chiefly as ministry
spokesman and overseer of foreign company
operations !n Ecuador. (Confidential)
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Jaime Moncayo Garcia
Minister of Finance
A respected economist, Jaime Moncayo
became Minister of Finance last February. He
previously served as Scb-Secretary General of
the Foreign Ministry, where he was most willing
and able to make policy decisions. Although
nationalistic, he seems well disposed toward the
United States. (Confidential) o
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Pertamina, the state oil company, is Indonesia's principal agent in the
exploitation of oil and gas resources and a major influence on petroleum policy.
Its wide-ranging functions include exploration, production, refining, marketing, and
overseeing the operations of foreign oil companies. Pertamina has grown rapidly,
becoming a large corporation. A major Indonesian innovation, used extensively by
Pertamina, is the production-sharing contract. Under this scheme, foreign oil
companies operate as contractors to Pertamina and share in both the risks of
exploration and the income from any discoveries.
A law promulgated in September 1971 revised the structure of the company
and spelled out its relailonship with the government. A Council of Commissioners
appointed by President Suharto supervises Pertamina's activities. The Council is
chaired by the Minister of Mining and includes the Ministers of Finance, Planning,
Industries, and Defense and Security. Also tasked with an oversight function is
the Oil and Gas Directorate of the Ministry of Mining; many of its key officials
serve concurrently in Pertamina. The corporation is run by a Board of Managing
Directors that technically must obtain approval from the Council of Commissioners
for its budget, borrowing above a certain limit, creation of subsidiaries, purchase
and sate agreements, and related matters.
President-Director Ibnu Sutowo is the dominant member of the Board, which
also includes the heads of Pertamina's five directorates. Ibnu is empowered i ~ make
decisions if Board deliberations are inconclusive and, in effect, is Indonesia's chief
petroleum policymaker. He has considerable influence with the Council and on
the Bcard, as well as with President Suharto and important military elements.
Moreover, his strong standing with foreign oil companies and solid reputation abroad
give him access to development funds outside regular budgetary channels. Ibnu
not only keeps a tight rein on policy but also closely watches the day-to-day
operations of Pertamina. (Confidential)
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Secret
INDONESIA: Petroleum Policymaking Organization
COUNCIL OF GOVERNMENT COMMISSIONERS
5 Cabinet Ministers
General Assistant
H. A. Thahir
1 L
EXPLORATION AND REFINING AND
PRODUCTION PETROCHEMICALS
Ir. Trisulo Ir. Socdarno
ADMINISTRATION AND DOMESTIC MARKETING SHIPPING
FINANCE
Ir. Anando Sochardlman Dr. Sockotlo
'-
PERSONNEL &
ORGANIZATIONS
R S,,hnrd.
-
HEALTH
ECONOMIC R
r
Dr. R M Soobdln
DEVELOPMENT
=1i
PRODU
CTION FORE
IGN MARK
ETING LEGAL. FOREIGN
UNI
TS REPRESEN
TATIVES ARE
R'LATIONS R MARKS NNG
AS
D; E Sanger
FOREIGN CONTRACTOI'S
COORDINATION
Snnlnnnn Sapdimnn
~+ttem+l '.
GENERAL SECRF'ARIAT
Ivan SunpanL
PRESIDENT-DIRECTOR
Dr. Ibnu Sutowo
PROJECTS
J Al Palllnr;Ina
MANA,EMF Ni SERVICES
D;e M J
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Secret
General Ibnu Sutowo
President-Director
P.N. Pertamina
General Ibnu Sutowo, 50, is "Mr. Oil" in Indonesia. He has been President-
Director of Pertamina since its inception in 1969 and was president of the
predecessor company. In 1966-68, he served concurrently as the Director General
for Oil and Gas in the Ministry of Mining.
Educated in European primary and secondary schoo!s, Ibnu went on to medical
school and served as a doctor in the army, ultimately rising to his current rank of
general. He continued on active military duty after being named head of the national
oil company in 1958.
Ibnu's iron-handed business methods and love of ostentation have brought
charges of corruption from the press. He nonetheless retains great influence with
Suharto and the military. US oilmen agree that Ibnu's leadership has made
Pertamina a far stronger organization than it would be otherwise. Americans who
have known him well say he is qualified to be board chairman of a large US oil
company.
During Ibnu's tenure with Pertamina, Indonesia has become a leader among
-producing LDCs. In recent years, Pertamina has branched out into other fields
such as steel, petrochemicals, fertilizers, and even tourist hotels. (Secret No Foreign,
Dissem)
Ir. Trisulo Djokopurnomo
Director, Exploration and Production Directorate
P.N. Pertamina
Trisulo, 42, Ma?aging Director for Exploration and Production, is probably the
most important man in Pertamina after Ibnu. He is a tough bargainer whose hands
are directly on the controls of key Pertamina operations. A graduate of Bandung
Technical Institute, Trisulo is a former foreign service officer and a petroleum
engineer. He also has served as an economist with OPEC in Vienna and as the head
of the oil and gas unit in the Ministry of Mining. Moreover, he is Ibnu's adviser on
the technical feasibility of all phases of operations. Without Trisulo's approval,
projects proposed by foreign firms have little chance of getting anywhere.
(Confidential)
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Mohammad Sadli
Minister of Mining
Council of Commissioners, Pertamina
In March 1973, President Suharto ap-
pointed Mohammad Sadli, 52, as Minister of
Mining. Sadli also serves as Chairman of
Pertamina's Council of Commissioners. An
MIT-educated professor of economics, he is
chairman of the Institute of Economic Re-
search at the University of Indonesia and is
also President Suharto's chief personal ad-
viser on economic matters.
The appointment was welcomed by
Ibnu Sutowo, head of Pertamina, which
comes under the Mining Minister's jurisdic-
tion. Ibnu regards Sadli as the only leading
technocrat who understands Pertamina's
problems and the petroleum business in general. Sadli also commands great respect
in international financial circles. (Secret)
Eldrich Sanger
Chief, Legal, Foreign Relations, and Marketing
Division, P.N. Pertamina
Eldrich Sanger, 47, was named head of
the Legal Division of Permina in 1966 and
retained his post in the successor firm,
Pertamina. A 1954 graduate of the Uni-
versity of Indonesia, Sanger continued his
studies in Germany, receiving a Ph.D. degree
in law from Bonn University in 1959. He
then returned to Indonesia and helped form
the Bureau of Oil Affairs. He headed the
bureau's Legal Department and helped draft
Indonesia's petroleum law. From 1964 to
1967, Sanger was Under Secretary of the Oil
Ministry under General Sutowo. He also acts
as Pertamina's chief negotiator for produo.-
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Secret
tion-sharing contracts and is attached to the government's Oil Negotiating
Committee. Sanger has attended OPEC meetings since 1962 and served as OPEC
Secretary General in 1969. Although he still has substantial influence in Pertamina,
especially in negotiating foreign contracts, he is not as close to Ibnu as he once was.
(Confidential)
Hadji Thahir
General Assistant for Administration
P.N. Pertamina
Thahir, 61, handles the workaday tasks of administration for Ibnu and has
closer access to the President-Director than anyone else. He has considerable
influence and is given a good deal of leeway, but because of his age, he would not be
a key figure in the event of Ibnu's departure. (Confidential)
Nitisastro Widjojo
Minister of State for Economy, Finance, and Industry
Council of Commissioners, Pertamina
Dr. Widjojo, 47, waF appointed Minister
of State for Economy in March 1973. He
had previously been Minister of State for
National Development Planning for 18
months. Widjojo continues as chairman of
the National Development Planning Board, a
post he has held since July 1967. One of
Indonesia's most able economists, he has
served as an economic adviser to President
Suharto.
Widjojo, along with Wardhana and to a
lesser extent Sadli, has pushed for more
closely supervised accounting of Pertamina's
activities. This has been a source of conflict
and irritation with Ibnu, Pertamina's President _:.,;ctor, who feels that Pertamina
must be free to make mr :'ey for Indonesia with minimum meddling from economic
technocrats in the government. (Secret)
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All Wardhana
Minister of Finance
Council of Commissioners, Pertamina
Ali Wardhana, 46, Minister of Finance
since June 1968, holds a doctorate from the
University of California at Berkeley. He has
also been an economic adviser to President
Suliarto since July 1966.
After a dispute between Wardhana and
Ibnu in March 1974, the President-Director
called for the Minister to resign from Perta-
mina's Council of Commissioners. President
Suharto imposed a compromise settlement
by appointing the Defenr ; and Industry
Ministers, both close assLciates of Ibnu, to
the Council. (Secret No Foreign Dissem)
Maraden Panggabean
Minister of Detense and Security
Couc:cii of Commissioners, Pertamina
In March 1973, President Suharto ap-
pointed General Maraden Panggabean Min-
ister of Defense and Security, and concur-
rently Commande - in Chief of the Indo-
nesian armed forces. Panggabean had been
de facto head of the army since August 1966
and of all military services since November
1969.
Panggabean, 52, was appointed to Perta-
mina's Council of Commissioners in April
1974. He is a close associate of Ibnu and can
be expected to support Ibnu fully in the
Council. (Serret No Foreign Dissem)
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Mohammad Jusuf
Minister of Industries
Council of Commissioners, Pertamina
!.t. Gen. .Audi Mohammad Jusuf, 46,
Minister of Industries since June 1968, is the
only cabinet-level nontechnocrat who holds
an economic portfolio. Jusuf was appointed
to Pertamina's Council of Commissioner-, by
President Suharto in an effort to placate
Ibnu's demands that Finance Minister Ward-
hana be removed from the Council. Jusuf is
a close associate of ibnu and can be ex-
pected to vigorously support the President-
Directcq's position on the Council. (Secret
No Foreign Dissem)
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Secret
The Shah is the key figure in all the major and many of the minor policy
decisions on Iranian oil matters. He sets the policy, appoints the administrators,
and ov; rsees rile operations of this vital industry, which provides more than
three-four,; is of Iran's export earnings. He obtains detailed information through
formal and informal channels and backs decisions with the full force of his position.
The parliament is pliable to the Shah's desires regarding petroleum legislation.
The Shah, in effect, acts as his own pciroieum minister. One of his principal
advisers is the Prime Minister, who, occasionally, also acts as the Shah's oil
spokesman. The Minister of Economics and Finance provides the Shah with the
income and expenditure data needed for decisions on oil policy. From the new
Ministry of Energy, the Shah presumably elicits information on domestic supply
and demand for petroleum and other energy sources. On international oil matters,
the Shah undoubtedly receives advice from his OPEC representative, Jamshid
Arn.lzegar. But Amuzegar's primary function is to carry out the Shah's biddinbs
in deliberations with oil ministers of other OPEC countrie,,.
The Shah frequently calls in officials of the private oil companies for an
exchange "f views. He also picks the brains of foreign visitors knowledgeable about
oil matters.
Operational control of the oil industry is vested in the National Iranian Oil
Company (NIOC), a government enterprise established when the industry was
nationalized in 1951. With growth of the industry, NIOC's span of control has
broadened to include natural gas and petrochemicals. In mid-1973, it took over
all the production and refinery facilities held by the Consortium - a group of
European and US companies that accounted for over 90% of Iran's oil output
and exports. The Consortium became the Iranian Oil Service Company - a service
enterprise with oil purchase rights for 20 years. The NIOC sells oil directly to
foreigners and arranges joint petroleum ventures abroad and in Iran. Four foreign
companies operating jointly with the NIOC currently account for 8% of Iran's
output of 6.1 million b/d.
The Shah's oil policies generally have been framed to maximize the revenues
available for ambitious industrial development programs. Iran thus has frequently
been in the forefront of OPEC efforts to raise oil prices. T;-- Shah was one of
the leading proponents of the sharp price increases of late 1973 and early 1974.
He is not only an adamant defender or prices but also an advocate of further
increases to reflect the growing cost of imported manufactures. The Shah has
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His Imperial Majesty
Shah Mohammad Reza Pahlavi
Minister of Interior and
Civil Service Affairs:
Jamshid Amuzegar
Steering Committee
Board of Directors
Director for Technical
and International Affair,-: Reza Fallah
IRAN: Petroleum Policymak!ng Organization
'The Steering Committee Consists of Ministers of Industries and Mines, Labor
and Social Services, State; and a Prime Minister appointee.
Minister of Economics
and Finance
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reacted strongly to what he considers threats by the oil-importing nations. "No
one can wave a finger at us," he said on 26 September, for "we will wave a finger
back." This is taken to mean that Iran and its supporters in OPEC will cut oil
production, if necessary, to support the present high prices. (Confidential)
Mohammad Reza Pahlavi
Shah of Iran
The Shah holds absolute power and makes all the major decisions on Iranian
petroleum policy. He is an intelligent, well-educated, strongly motivated, personable,
yet suspicious individual. Now nearing 55, lie exudes confidence in himself and the
future greatness of Iran. Under his dynamic leadership, Iran has developed the
largest and fastest growing economy and one of the strongest military forces in the
Middle East.
The Shah's current Five-Year Development Plan (ending March 1978) and his
far-reaching "Great Civilization" program rely on revenues from petroleum. He
therefore is determined to protect these vital assets from threat of foreign military
force and from price erosion in the world market. Working closely with other
members of OPEC, the Shah is attempting to link oil prices to prices of Western
industrial goods. I-Ie also is negotiating to trade oil for scarce industrial raw materials
and for foreign participation in Iran's industrial development. With oil revenues
currently exceeding domestic needs, the Shah is lending and investing abroad to
enhance Iran's political influence and long-term economic strength. (Confidential)
Amir Abas Hoveyda
Prime Minister
Amir Abas I-Ioveyda, 56, has been Prime
Minister for 9 years. His expert handling of the
cabinet has reduced the frictions that harassed
previous Prime Ministers. Some of Hoveyda's
success derives from his ability to t:,id,rstand
the Shah's wishes.
On oil matters, Hoveyda probably gives
some advice to the Shah and may function as a
sounding board for the Shah's ideas. His primary
function, however, is to serve as a spokesman for
the Shah and to guide the NIOC. He is the
ranking member on the NIOC steering com-
mittee.
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An economist by profession, Hoveyda is a perceptive, hard-working individual
who gets along well with others. He is a veteran traveler and speaks fluent English,
French, and Arabic. (Confidential)
Jamshid Amuzegar
Minister of Interior and Civil Service Affairs
In April 1974, Jamshid Amuzegar, 50,
became Minister of Interior and Civil Service
Affairs in a cabinet shuffle. He had served since
1965 as Finance Minister. Amuzegar remains
Iran's leading international spokesman on petro-
leum matters and retains his OPEC responsibil-
ities. Intelligent, articulax, and charming, he
nonetheless is a tenacious negotiator. He is
friendly toward the United States but he tries to
avoid any stand that could be labeled pro-
American.
Amuzegar has degrees in public health and
sanitary engineering from Cornell University and
a Ph.D. in hydraulic engineering from the University of Washington. Before
becoming Finance Minister, lie served as Minister of Labor, of Agriculture, and of
Health. In each case lie showed considerable dynamism, promoted modernization of
Iranian society, and criticized corruption. He has a reputation for clear, forceful
presentations of his views.
Amuzegar speaks excellent English and German and can converse intelligently
on almost any subject. He has three prominent brothers: Jahangir is Minister for
Economic Affairs at the Embassy in Washington; Kuros was Minister of Housing
prior to April 1974: and Hushang was head of the Information Department of the
OPEC Secretariat until November 1973. (Confidential)
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Hushang Ansari
Minister of Economics and Finance
Hushang Ansari, 45, a formei diplomat
with wide contacts in business and government,
received the newly created portfolio of Eco-
nomics and Finance in April 1974. He had
served since July 1969 as Minister of Economy
and, before that, as Ambassador to the United
States. Ansari is aggressive, efficient, imagina-
tive, and pro-American.
He headed a trade delegation to the USSR
in 1972 and has since visited the United States,
China, West Germany, the United Kingdom,
Japan, Pakistan, Yugoslavia, India, and Egypt.
He currently is in the United States, reading
Iran's IMF/IBRD delegation.
Ansari has come down hard against proposals to expand oil output and weaken
prices. With the backing of the Shah, lie recently took a swipe at Saudi Arabia's
Minister of Petroleum, emphasizing that any Saudi action to reduce prices would be
met by production cuts in Iran and other OPEC countries, Although he is not
involved directly in operating matters, he is a member of the NIOC steering
committee. (Confidential)
Iraj Vahidi
Minister of Energy
Iraj Vahidi, 46, received the newly created
post of Minister of Energy in the cabinet
reshuffle of April 1974. He had been Minister of
Water and Power since 1971. An able, highly
respected executive and technician, Vahidi is
most familiar with water resources and related
agricultural matters. He was managing director
of the Khuzestan Water and Power Authority in
1966-69 and then Minister of Agriculture. In
October 1973 he held talks with US business-
men on nuclear power projects.
Still an uncertain factor in petroleum pol-
icy, Vahidi is not believed to carry the weight of
23
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the "old hands" such as Amuzegar, Ansari, or Hoveyda. Although a member of the
NIOC steering committee, Vahidi does not appear to exercise any special ministerial
control over the NIOC. (Confidential)
Manuchehr Eqbal
Chairman of the Board and General Managing Director,
National Iranian Oil Company
Dr. Manuchehr Eqbal, 65, has been the
head of the NIOU, Iran's principa' state-owned
petroleum enterprise, since 1963. Although a
physician by training, lie has had extensive
experience in the government, serving at one
time as Prime Minister.
Equal plays a key role in determini-;g NIOC
policy, in directing the NIOC's d-imc;tic activ-
ities, and in negotiating NIOC agreements with
foreign firms. In September 1974, he journeyed
to several West European capitals and to Wash-
ington, meeting with the various heads of
government. Egbal dutifully follows the Shah's
policies and spends a good deal of his time explaining NIOC decisions and problems
to the Shah. He apparently stays clear of political squabbles. (Confidential)
Reza Fallah
Director of Technical and International Affairs,
National Iranian Oil Company
Keza r a11ah has been a member of the
Board of Directors of the NIOC since 1952. He
is one of the most competent and influential
leaders in the Iranian oil industry and is in
frequent contact with the Shah. Urbane, force-
ful, and ambitious, Fallah skillfully uses his
position to further his own interests. In March
1973 the Shah appointed him head of the
Iranian delegation in the takeover from the
Consortium.
Fallah has been described as an Anglophile.
His attitude toward the United States is un-
known; some American executives consider him
Secret
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to have a better understanding of the importance of the international oil companies
than does Manuchehr Eqbal, NIOC's chairman. (Confidential)
Bager Mostofi
Managing Director, National Petrochemical Company
Bager Mostofi has headed the NPC since its
founding in 1964. A technician by training, he
also is an ambitious administrator.
Mostofi has been the leading proponent of
Iran's venture into petrochemical production.
Although inexperienced in petrochemistry, Mos-
tofi is adept at negotiating petrochemical pro-
jects involving Iran. In this connection, he has
traveled to the United States, various West
European countries, and Japan. Mostofi is occa-
sionally engaged in jurisdictional disputes with
the head of the NIGC, who reportedly is vying
with him for power. (Confidential)
Taqi Mosadeqi
Managing Director, National Iranian Gas Company
Taqi Mosadeqi, 52, has been managing director of the NIGC since 1969. Bright
and aggressive to the point of ruthlessness, he reportedly is locked in a power
struggle with the head of the National Petroleum Company, Baqer Mostofi.
Mosadegi is a tough taskmaster who brings a thorough knowledge of the oil and
gas industries to the job. On receiving a degree in civil engineerinrt in 1945, he set
out to work in the oil industry. By 1960, he was general manager of NIOC
operations at Abadan. lie became head of non-technical operations in the
Consortium Agreement Area in 1966, and an alternate; member of the NIOC board
in 1969. As managing director of the NIGC, Mosadeqi has engaged in negotiations
on gas agreements with foreign firms.
In August 1974, he concluded agreements with European and American
consortiums that will involve some of the largest gas projects in the world. In the
same month, he negotiated a new agreement with the USSR that hikes prices by
85%. Mosadegi should become even more prominent as Iran develops its huge gas
reserves-second only to those of the USSR. (Confidential)
25
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IRAQ
The power to decide oil policy rests with the twelve-member Revolutionary
Command Council (RCC) headed by President Hasan al-Bakr. Within the RCC,
the dominant position in oil decisionmaking has been assumed by the Council's
Vice President, Saddam Husayn al-Tikriti. Jockeying for influence larg''.- .~nded
in 1974, when the Oil Affairs Follow-up and Agreements Implem , ation
Committee was established with Tikriti as its chairman. This five-man committee
has supervisory authority over the government oil companies and controls marketing
policy, including setting sales prices and negotiating sales contracts.
The Secretary General of the Committee is 'Adnan Hamdani, a newly elected
member of the RCC and a protege of Tikriti. Another influential member is Dr.
Sa'dun Hammadi, who also occupies the key positions of Minister of Oil and
Minerals and Chairman of the Iraqi National Oil Company (INOC). Dr. Hammadi's
role in developing oil policy has been somewhat diluted, however, by formation
of the Follow-up Committee. He basically implements the policies and guidelines
established by Saddam Husayn al-Tikriti and 'Adnan Hamdani.
Operational control of the oil industry is in the hands of the
government-owned INOC. This company was established in 1964 to exploit those
areas confiscated from Iraq Petroleum Company (IPC), an operation owned by
Royal Dutch Shell, British Petroleum, Cie. Francaise des Petroles, and a consortium
of American petroleum giants. The government expropriated 99.5% of IPC's
undeveloped concession area as early as 1961 but left the private company in
control of its producing oil fields until 1972.
Tr,P final nationalization agreement signed on 28 February 1973 put INOC
in effective control of the entire industry. Even the Basrah Petroleum Company
(B3PC) - an affiliate of IPC and the sole survivor of the 1c"13 nationalization
decree - is 43% owned by INOC. Its daily operations are o erseen by INOC's
sister company, the Iraq Company for Oil Operations (ICOO). INO operates the
industry through service contracts with IPC and other foreign firms.
Unlike most other national oil companies, INOC is not empowered to
undertake refining and domestic distribution of products. This remains the
responsibility of the Government Oil Refining Administration (GORA), which took
over the operation from British Petroleum in 1952. INOC is determined, however,
to establish an integrated oil operation. In 1972, it set up the Iraq National Oil
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 Ministry of Oil and Minerals
Dr. Sa'dun Hammadi
Dr. Fadil al-Shalabi
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Iraq. Petroleum Policymaking Organization
Revolutionary Command Council
President: Ahmad Hasan al-Bakr
Vice President: Saddam Husayn al-Tikriti
Plus twelve members
Economic Affairs Bureau
Dr. Fakhri Qadduri
Council of Ministers
Prime Minister: Ahmad Hasan al-Bakr
Twenty-eight Ministers, including:
Oil Affairs Follow-up and Agreements
Implementation Committee
Chairman: Saddam Husayn al-Tikriti
Secretary General: Adnan Hamdani
Ministry of Planning
Dr. Jawad Hashim
Ministry of Economy
Hikmat al-'Azzawi
I pe I
Iso._?......w.......
Others, including :
Government Oil Refineries Administration
Petroleum Products Distribution Administration
Gas Distribution Administration
Iraq National Oil Company
Chairman: Sa'dun Hammadi
Director General:'Abdallah Shakir al-Sayyab
(also Chairman, OPEC Board of Governors)
State Company for Consulting
and Planning of Oil Projects
Director General: Mahdi al-Shaykh' Ali
Iraq Company for Oil Operations
Chairman:'Abd al-Fattah al-Yasin
Iraq Petroleum Company
Chairman: C. M. Dailey
Executive Director: H. C. Goff
(offices in London)
I
Foreign Contractors:
Entreprise des Recherches et d'ActivitAs Petrolieres (ERAP)
State-owned companies from USSR, Romania, Bulgaria, India, and Brazil
Basrah Petroleum Co.Ltd.
(Same officers as IPC)
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Tankers Company to operate a rapidly expanding tanker fleet. INOC's engineering
arm, the State Company for Consulting and Planning of Oil Projects (SCCOP),
plays an important role in awarding construction contracts to foreign firms.
The oil establishment is beginning to distinguish between the economic
interests of the state and the ideology of the ruling party. Because new contracts
for construction and exploration are being awarded with an eye to economic
considerations, more Western firms are entering the country. Major expansion
projects now under way include oil field development and construction of new
refineries, pipelines, and port facilities. Significantly, Iraq was the only member
of the Organization of Arab Petroleum Exporting Countries not to support the
production cutback scheme last winter. It maintains a brad line favoring both high
prices and maximum production. Iraq's oil strategy is to harness growing oil
revenuew to the process of economic development in general and industrialization
in particular. (Secret)
Ahmad Hasan al-Bakr
President; Chief of State; Commander in Chief
of the Armed Forces; Minister of Defense
Ahmad Hasan al-Bakr, 62, became President following the 17 July 1968 coup
that brought the Ba'ath Party to power for the first time since February 1963.
Shortly thereafter, he named himself Prime Minister (now called Chief of State)
and Commander in Chief of the Armed Forces. A moderate leader of the party,
Bakr is also President of the Revolutionary Command Council. In July 1973, he
appointed himself Minister of Defense.
In years past, Bakr has been cordial to US officials but publicly a 'ti-American.
From 1973 on, he has appeared to be signaling a desire for improved relations
with the West. His economic policies have resulted in an expanded Western presence
in Iraq. In particular, the regime has been interested in tapping Western oil
technology.
In early 1974, Bakr indicated opposition to any consumer-producer conference
called by the United States. In a letter to Washington, he stated that the United
Nations ;s the best framework for discussing energy questions. Iraq objected to
a hand-'u, of industrial nations representing consumer countries; all countries, he
said, are energy consumers.
29
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Bakr graduated from Baghdad Teachers College and attended the Royal
Military College. He was a member of the Free Officers Movement and participated
in the July 1958 revolution that overthrew the monarchy. His career has been
highlighted by arrests, high government posts, and leadership in the international
Ba'athist movement. In January 1969, Bakr was promoted to marshal - a rank
equivalent to general. (C"nfidential)
Saddam Husayn al-Tikriti
Vice President, Revolutionary Command Council
Assistant Secretary General
Ba'ath Party of Iraq Regional Command
As Vice President of the Revolutionary
Command Council, Saddam al-Tikriti is nomin-
ally second to President Ahmad Hasan al-Bakr.
Many consider him the strong man of the
regime. Since Novembe- 1968, Tikriti also has
been the assistant secretary general of the Ba'ath
Party of Iraq Regional Command (BPIRC)-the
most powerful position in the party. Although
President Bakr is the secretary general of the
BPIRC, the post is only titular.
In the spring of 1974, Tikriti was made
head of a newly formed Oil Affairs Follow-up
and Agreements Implementation Committee. It
has responsibility for marketing all government-owned crude oil and is the dominant
decisionmaking organization on oil matters.
Tikriti, 37, has been in jail, plotted assassinations, and negotiated a friendship
pact with the USSR. He militantly insists that Arab regimes should nationalize
Western oil companies. Trained as a lawyer, lie was a key figure in the
nationalization of the Iraq Petroleum Company. (Confidential)
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Sa'dun Hammadi
Minister of Oil and Minerals: Chairman, INOC
Sa'dun Hammadi, an American-educated
technocrat, has been Minister of Oil and Min-
erals since December 1969. He became chairman
of INOC in March 1973, a post lie had pre-
viously held from November 1968 through June
1971. Hammadi is interested in the possibilities
of long-term agreements under which consuming
countries would furnish technical and develop-
ment aid in return for guaranteed oil supplies.
Hammadi, 44, graduated from the Amer-
ican University of Beirut and then received a
Ph.D. in agricultural economics from the Uni-
versity of Wisconsin in 1957. Returning to Iraq,
he became editor of the semiofficial newspaper at-Jumhurriyah in 1958. His political
activities soon forced him to flee to Lebanon, where he remained until 1960. He
reportedly then went to Tripoli and joined the Research Department of the National
Bank of Libya. He was imprisoned upon return to Iraq in January 1963 but was
freed after the Ba'ath-led coup the following month. Hammadi filled the post of
Minister of Agrarian Reform until the November countercoup by the Iraqi army
brought a purge of Ba'ath Party figures. Hammadi lived in Lebanon, Syria, and
Libya before returning to Iraq in 1968. (Secret No Foreign Dissem)
Fadil al-Shalabi
Under Secretary for Technical Affairs;
Ministry of Oil and Minerals
Fadil al-Shalabi, 45, became Under Secretary in the Ministry of Oil and
Minerals in May 1973. He had previously served for three years as director general
of oil affairs in the same ministry. An influential figure, he has been mentioned
as a possible successor to the current minister.
In a February 1974 interview, Shalabi outlined his belief that consumer
countries not only must pay remunerative prices for oil but also must provide
exporting countries with technical and development assistance.
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Shalabi holds a Ph.D. from the University of Paris, where he wor honors
for a thesis entitled Oil Economics. He entered government service in the early
1960s as an official in the Ministry of Trade and later moved to the Ministry
of Economy. In 1968, he was named a part-time member of the INOC Board
of Directors. He is also a member of the board of the Central Bank. Shalabi speaks
some English. (Confidential)
'Abdallah Shakir al-Sayyab
Vice President for Agreements, INOC; Chairman
OPEC Board of Governors
'Abdallah Sayyab, 46, has been INOC's Vice President for Agreements since
early 1972. He had previously served as a technical adviser to INOC. He was selected
as Chairman of OPEC's Board of Governors in January 1974.
Sayyab holds B.S. and M.S. degrees in geology from Indiana University and
a Ph.D. in paleo::tology from Iowa University. Joining the Ministry of Oil and
Minerals in 1960, he served successively as director of exploration and research
(1960-63), director of the Technical Section (1963), and director general of oil
affairs (1964). He was appointed to the INOC Board of Directors in 1964 and
became an executive director of the board in 1967.
Sayyab has been cordial and friendly toward US officials. (Confidential)
Mahdi al-Shaykh 'Ali
Director General, State Company for Consulting
and Planning of Oil Projects; Member,
Board of Directors, INOC
Dr. Mahdi al-Shaykh 'Ali was appointed director general of the State Company
for Consulting and Planning of Oil Projects in March 1970. His term as a member
of the INOC Board of Directors was renewed in June 1974 for another two years.
Born in 1936, 'Ali graduated from the College of Engineering in Baghdad
in 1958. In January 1965, he received the degree of kandidat from the Moscow
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Scientific Research Institute of Concrete and Reinforced Concrete. During his five
years in Moscow, 'Ali was assistant agricultural attache at the Iraqi Embassy. In
early 1965, he requested US Embassy assistance in enrolling in a US university
to pursue a Ph.D., but it is not known if the project materialized.
'Ali has traveled to Czechoslovakia (September 1970), Syria (September 1971),
the USSR (September 1972), India (March 1974), and Kuwait and Bahrain (June
1974) for discussions about oil matters. (Confidential)
33
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Minister of Finance and Oil 'Abd al Rahman Salim al-'Atiqi has overall
responsibility for Kuwaiti oil affairs. His power is constrained, however, by both
the ruling family and the emerging parliamentary system of government (see the
chart).
Ultimate authority rests with the Sabah family. The consent of the Amir,
Shaikh Sabah al-Salim al-Sabah, must be obtaine-.l for all major decisions. Crown
Prince Jabir al Ahmad al-Jabir al-Sabah plays a more active role than the Arnir
in formulating oil policy.
The National Assembly - consisting of a 50-man elected body plus the 15
members of the Council of Ministers - also has considerable influence on C-11
matters. Having the nominal authority to pass on all treaties and agreements with
foreign oil companies, the Assembly has been a prominent instrument in shaping
Kuwaiti oil policy. On the key issue of the moment - whether to cut output,
conserve resources, and maintain prices or to maintain production - the royal
family, the Assembly, and the Minister appear to have reached agreement on price
maintenance.
'Atiqi's Ministry of Finance and Oil (MFO) is the most powerful agency in
the government, managing almost all of its ?oreign assets as well as making the
major decisions on oil production and marketing. The Ministry is the primary
negotiator with the oil companies and represents Kuwait at OPEC and OAPEC
meetings.
The Ministry may gain importance from the proposed appointment of 'Atiqi
to head a new organization, the General Establishmei t for Oil (GEO). The GEO
will control all aspects of the state oil industry, including exploration, production,
p;?ocessing, and marketing of oil and gas. A seven-member executive board under
the Ministry of Finance and Oil will formulate GEO policy. One of the main jobs
of the new institution will be to administer the government's newly acquired 60%
share of the Kuwait Oil Company (KOC).
Pending Assembly approval of the GEO, an interim corporation - the Kuwait
Oil, Gas, and Energy Company (KOGEC) - is being set up. It will be financed
by a 76% subscription from the government directly and a 24% subscription from
four major mixed companies operating in Kuwait.* In all, the government will
own over 90% of the shares.
Another key organization, the Kuwait National Petroleum Company (KNPC),
is owned 60% by the government and 40% by the private sector. Established in
" The Kuwait National Petroleum Company (KNPC), the Kuwait Petrochemicals Industries Company (KPIC),
the Kuwaiti Foreign Trading Contracting and Investment Company (KFTCIC), and the Kuwait Maritime
Navigation Company.
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KUWAIT: Petroleum Policymaking Organization
50 elected members
Cabinet members ex officio
have vote
Kuwait National Petroleum Company
(KNPC)
60% government 40?? private
Chairman and Managing Director
Ahmad Mutair
Heir Apparent and Prime Minister
H. H. Shaikh Jabir al-Ahmad
al-Jabir al-Sabah
L..p al-Ahmad al-labir al-Sabah
A policy approving body
Ministry of Finance and Oil
H. E.'Abd AI-Rahman Salim al-'Atiqi
General Establishment for Oil
(Proposed) (GEO)
7-member executive board
Chaired
H. E. 'Abd al-Rahman Salim al-'Atigi
Kuwait Oil Gas and Energy Committee
(KOGEC)
Interim company
76?. government 24?? shared by
4 mix government/private companies
Ministry of State for Cabinet Affairs
H. E. 'Abd al-Aziz Husayn
Planning Board
Assistant Under Secretary for Oil Affairs
H. E. Mahmud Khalid al-Adasani
Oil Pricing Subcommittee
H. E. Ahmad Mutair
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1960, it was given exclusive rights to market petroleum products in Kuwait. Its
operations have expanded to include the 115,000 b/d Shuayba refinery, local
exploration activities, and three overseas marketing subsidiaries in Japan, the United
Kingdom, and continental Western Europe.
Although largely autonomous in its daily operations, this company has been
dependent in the past on the MFO for project funds, and its director can be hired
or fired by the Council of Ministers. Concerned about the high share of private
ownership in the KNPC, the ruling family had the Council of Ministers reject
its recent bid to handle the government's interest in the Kuwait Oil Company.
Of the agencies concerned less directly with petroleum policy, the only one
of potential importance is the Kuwait Planning Board On paper, the Board has
authority to coordinate and approve the planned pr:)jects of all the Ministries.
Its director, Ahmad Ali al-Du'ayj, reports directly to the Crown Prince even though
the Board formally is under the Ministry of State fog Cabinet Affairs. The Board
has 17 members - 7 permanent members from the go'; ernment and 10 businessmen
appointed for four-year terms. Thus far, the Board's parade of five-year plans
has had little effect on development of the economy, which still reflects mainly
decisions of the business community. (Confidential)
Sabah al-Salim al-Sabah
Amir
Shaikh Sabah became Amir of Kuwait in 1965. Politically conservative, Sabah is
pro-Western and has been most forthright in his dealings with US officials. In
February 1974, he favored unofficially easing the oil boycott against the United
States because he did not fuel that Kuwait could afford the political and economic
costs involved.
Unlike King Faisal of Saudi Arabia, he does not involve himself in the
day-to-day affairs of government. He does insist that others brief him and obtain his
consent on major policy decisions. He probably will continue to avoid an active role
in intense bargaining sessions. (Confidential)
Ahmad Mutair
Chairman and Director of Kuwait National Petroleum Company
Ahmad Mutair became the director of the KNPC in early 1972 when the
cabinet removed his predecessor after less than nine months in the position. Mutair
concurrently chairs the oil pricing subcommittee of the Ministry of Finance and Oil.
An able leader, Mutair has successfully coped with a troubled company and a
fractious board, balancing the wishes of the government against the profit-making
motivation of the non-government members of the board. (Confidential)
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Jabir al-Ahmad al-Jabir al-Sabah
Crown Prince, Prime Minister
ShaiYh Jabir became Crown Prince in 1966
and has been Prime Minister since 1965. He is
also the president of the Council of Ministers.
From 1959 to 1965, he held posts related to
petroleum and finance that gave him consider-
able influence over the nation's growing econ-
omy. Because of his background, Shaikh Jabir is
interested in the petrochemical industry and has
pressed for industrialization. He, along with
'Atiqi, is a key policymaker on oil-related ques-
tions. He is eager to establish Kuwait as an
independent Middle East oil power and occasion-
ally may pursue a path inimical to Kuwait to
make the point.
Shaikh Jabir's political power base is the
largest of all the ruling family. He is careful to
avoid positions that might incur criticism from
the political left. Regarding the left and other
causes he promotes, he can be headstrong in his
convictions. (Confidential)
Ahmad `Ali al-Du'ayj
Director General of the Planning Board
Ahmad Du'ayj, one of the most intelligent
and capable members of the government, has
been director general of the Planning Board with
the rank of Deputy Minister since 1964. An
active and progressive administrator, Du'ayj has
control of the Board's activities and is in an
excellent position to implement his development
plans for Kuwait. He recognizes the need for US
private and governmental technical assistance at
Kuwaiti expense. Although he is not directly
involved with oil policy, his Board has the
authority to coordinate the development plans
of the Ministries. This power, plus the fact that
he reports directly to the Crown Prince, has left
him subject to jealousy. He is also opposed by
wealthy conservative merchants who prefer a
laissez-faire environment. (Confidential)
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`Abd al-Rahman Salim al-'Atiqi
Minister of Finance and Oil
'Atiqi, 46, has been Minister of Finance and
Oil since 1967. He is the governor of the Kuwait
Central Bank, an ex-officio member of the
Kuwait Planning Board, a governor of the IMF,
the principal adviser to the Amir, and a key
figure in OPEC and OAPEC. He will be the head
of the new General Establishment for Oil and
currently heads the interim organization,
KOGEC. He works closely with Saudi Minister of
Petroleum Ahmad Zaki Yamani. He is considered
pro-Western and generally has been cooperative
with US officials. He believes, however, in a
nonaligned foreign policy. Oil companies regard
him highly because of his moderate policies. He
has favored maintaining production levels, but
also supports retaining high oil prices.
'Atiqi is disturbed about current economic relations with the industrialized
West. He sees US currency devaluations and the steady inflation that raises the price
of imported goods and services as reducing the value returned for Kuwaiti oil.
(Confidential)
Mahmud Khalid al-`Adasani
Assistant Under Secretary for Oil Affairs
Ministry of Finance and Oil
The first Kuwaiti to receive a degree in
petroleum engineering, `Adasani was named to
his current post in 1966. He is considered
Kuwait's senior oil technician. He was earlier
employed by the KOC and served as one of two
Kuwaiti representatives on the Board of Direc-
tors. (Confidential)
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`Abd al-Wahhab Muhammad 'Abd al-Wahhab
Under Secretary
Ministry of Finance and Oil
`Abd al Wahhab, considered one of Kuwait's key officials, has been Under
Secretary of the MFO since 1966. A tough and capable administrator, he has
brought order to the Ministry through a willingness to exercise authority. He also
serves as a member of the Kuwait International Investment Advisory Committee and
as a member of the Board of Directors of the Kuwait Central Bank. He has served as
a member of the Board of Directors of the Arab-African Bank. (Confidential)?
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All major decisions on oil policy are made by Revolutionary Command Council
Chairman Qadhafi, usually after discussion with his second-in-command, Jalud. More
knowledgeable about oil matters and less emotional, Jalud has considerable sway
over Qadhafi. Nevertheless, he neither challenges Qadhafi's superior role nor takes
important actions without prior consultation. Once basic policy decisions are made,
it is Jalud who initiates action, dealing with the oil companies and delegating
responsibilities to other parts of the government.
Directly subordinate to the RCC, the Ministry of Petroleum is charged with
the day-to-day administration of the petroleum sector. It provides policy support
to the RCC, implements RCC decisions, and handles routine policy questions.
Industry-wide statistical compilations, production regulation, technical training,
personnel supervision, and participation in international organizations are all under
the jurisdiction of the ministry. Minister of Petrol .im Mabruk and his deputy,
Muntasir, work closely with Jalud on major issues, supplying him with information
and standing in for him during negotiations with the oil companies. Jalud and
Qadhafi do not feel obligated, however, to honor commitments made at the ministry
and have been known to reverse them.
The Libyan National Oil Corporation is the operating arm of the Ministry
of Petroleum and has no assigned role in policy formulation. LNOC executives
nonetheless make policy recommendations on the basis of operational constraints
and do exert some influence. In 1973, for example, the scarcity of trained
technicians available to LNOC was a key factor limiting the scope of
nationalizations.
LNOC was created in 1970 to succeed the Libyan General Petroleum
Corporation (LIPETCO), which had been established by King Idris in 1968. The
company is authorized to engage in all aspects of petroleum exploration,
production, refining, and marketing. Initial activities were confined to exploitation
of concessions jointly owned with foreign firms and to operation of a small field
relinquished by Phillips Petroleum. Nationalization of British Petroleum assets in
December 1972 gave LNOC its first substantial production properties. Subsequent
nationalizations have raised LNOC's share of Libyan oil output to about two-thirds.
Through its subsidiaries, LNOC operates the wholly owned Sarir field, participates
in the management and operation of all other fields, markets and refines crude
oil, and operates a fledgling tanker fleet.
In international oil circles, Libya is regarded as one of the more radical Arab
producers. Tripoli has been a leader in expanding state control over oil resources.
ai
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In 1970, selective pressures and skillful bargaining won unprecedented revenue
increases for Libya and demonstrated the power of oil-producing countries. In the
next few years, Libya joined forces with other Mediterranean producers to negotiate
further revenue increases and proceeded to nationalize producing assets on a
piecemeal basis. It was a strong supporter of last winter's Arab oil supply cutbacks
and the OPEC decision to raise prices drastically. Libya currently favors further
increases in state revenues - at the expense of production cuts, if necessary --
and no doubt intends eventually to complete its takeover of foreign-owned oil
operations. (Confidential)
LIBYA: Petroleum Policymaking Organization
REVOLUTIONARY COMMAND COUNCIL
Chairman: Mu'ammar al-Qadhafi,
Member: 'Abd al-Salaam Ahmad Jalud
MINISTRY OF PETROLEUM
Minister: 'Izz al-Din al-Mabruk
Deputy Minister: Umar Mustafa Muntasir
LIBYAN NATIONAL OIL CORPORATION
(presidency currently vacant)
Mu'ammar al-Qadhafi
Chairman of the Revolutionary Command Council
Qadhafi has led Libya ever since he engineered a coup that removed King Idris
in 1969. Intense, outspoken, and unpredictable, Qadhafi chairs the ruling Revolu-
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tionary Command Council and is clearly in charge. He was educated at the Royal
Military Academy and was a career army officer before the coup. His technical
expertise in the petroleum field is limited, but he is quick to grasp information and
ideas presented to him. He favors full Libyz.n control of domestic resources, higher
prices for oil, and conservation of resources. (Confidential)
'Abd al-Salaam Ahmad Jalud
Prince Minister
Second only to Qadhafi in influence, Jalud
has been Prime Minister since July 1972. Pre-
viously, he served as Deputy Prime Minister and
Minister of Economy. Qadhafi and Jalud fre-
quently argue but nevertheless work well to-
gether. Jalud is the Revolutionary Command
Council's best executive and most technically
competent member in oil affairs. His knowledge
of oil matters has been acquired mostly on the
job. Bright and shrewd, Jalud has masterminded
the encounters with the oil companies and was
responsible for the 1970 breakthrough in oil
revenues. (Confidential)
'Izz al-Din al-Mab: uk
Minister of Petroleum
Mabruk has been Minister of Petroleum
since January 1970. He studied law in Cairo and
London and previously served as an appellate
judge in Tripoli and as a legal adviser and
consultant to OPEC. His authority in petroleum
affairs is limited because all major policy de-
cisions are made by the Revolutionary Coin-
mnand Council. He is a staunch supporter of the
regime and tries to mediate between the RCC
and the oil companies. He often serves as the
RCC's spokesman on oil both at home and in
international forums. As Minister of Petroleum,
lie advocates further Libyanization of the petro-
leum sector, increased domestic processing of
oil, and conservation of natural resources. (Con-
fidential)
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Umar Mustafa Muntasir
Deputy Minister of Petroleum
Muntasir has been Deputy Minister of Petroleum since early 1973. Previously,
he served as Deputy Director of the Libyan National Oil Corporation and as director
general of economic affairs and research within the Ministry of Petroleum. He is one
of the many technicians who were imprisoned for political reasons under the ?dris
regime and were drawn into responsible government posts after the coup. He enjoys
the confidence of the Revolutionary Command Council, frequently filling in for
Mabruk and even Jalud at petroleum meetings. He holds a masters degree from
American University and worked for Mobil Oil Company in Libya until imprisoned
in 1967. (Confidential)a
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 MINISTRY OF MINES AND POWER
COMMISSIONER: S.A. MONGUNO
PERMANENT SECRETARY:
P.C. ASIODU
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Executive and legislative power in Nigeria is vested in the Federal Military
Government, headed by General Yakubu Gowon. Gowon is Chairman of both the
Supreme Military Council (SMC) and the predominately civilian Federal Executive
Council (FEC) (see the chart). The FEC organization most directly concerned with
petroleum policymaking is the Ministry of Mines and Power - especially its
Department of Petroleum Resources, which handles oil policy and regulation. The
Nigerian National Oil Co. (NNNOC), a state corporation, is the government's
operating unit for all petroleum matters. The Ministry of Finance determines
petroleum tax policy and budgets oil revenues.
NIGERIA: Petroleum Policymaking Organization
HEAD OF THE FEDERAL
MILITARY GOVERNMENT
GENERAL YAKUEU GOWON
SUPREME MILITARY COUNCIL
CHAIRMAN: GENERAL GOWON
MLA 1[II.NS 51A11 C;J,Vl 115)14:,
Si )111)14 1JIII I I Aft? All)) 9'111 ('1
FEDERAL EXECUTIVE COUNCIL
CHAIRMAN: GENERAL GOWON
1,1I h111L.145 '25:1 CIVII1All ('1 )1.1MI.`:S")NI Ill,
1 I SI 111)54 MILIrASI ANTI P(' IQ
I
L_______________,
DEPARTMENT OF PETROLEUM
RESOURCES
DIRECTOR: M.O. FEYIDE
MINISTRY OF FINANCE
COMMISSIONER: S. SHAGARI
PERMANENT SECRETARY:
A. AYIDA
P.G. ASIODU
EXPLORATION AND PRODUCTION
MANAGER: R.A. MARINHO
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Policymaking procedure depends on the importance of the issue. On minor
questions, policy may be set by the Director of Petroleum Resources or his
subordinates. Decisions of moderate significance are normally made by the FEC
after the matter has moved up through the Commissioner of Mines and Power.
Key issues, such as the decision to form a national oil company, require
consideration by both the FEC and the SMC, with General Gowon himself usually
being directly involved.
Important policy moves typically are suggested by the civil service, reviewed
by the FEC, and then submitted to the SMC for decision. On a day-to- day basis,
the commissioners' subordinates, the permanent secretaries, have the greatest
responsibility and de facto policymaking authority because of their technical
expertise. Military officers apparently play only a small role in petroleum
policymaking, normally deferring to senior civil servants.
NNOC was created in ,early 1971 to take part in petroleum exploration,
production, refining, and marketing. Initially, NNOC merely took over minority
shares in foreign oil companies in Nigeria. NNOC also was given exclusive
exploration rights in all unassigned acreage; it is to exploit any petroleum resources
found in these areas through production-sharing or service contracts. The first pro-
duction-sharing agreement was negotiated in June 1973 with Ashland Oil Company.
NNOC recently hired two US firms to conduct seismic surveys of all its offshore
acreage.
In international oil policy, Nigeria has been satisfied merely to follow the
lead of the Middle East producers. It has been widely regarded as one of the more
moderate OPEC countries. While Lagos' decisions are influenced by developments
in other producing countries, no foreigners have been identified as playing a direct
role in Nigerian oil policy. (Confidential)
All Monguno
Commissioner, Ministry
of Mines and Power
An educator turned politician, Ali Monguno
became Commissioner for Mines and Power in
1971. Previously he had been Commissioner for
Industries and Commissioner for Trade. He has
studied at various Nigerian schools as well as
Edinburgh University. Monguno is an able and
honest administrator and has few enemies. While
officially outranking his Permanent Secretary,
P.C. Asiodu, he has in fact far less influence on
Nigerian petroleum policy. (Confidential)
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Philip Asiodu
Permanent Secretary, Ministry
of Mines and Power
Chairman of Board of Directors,
NNOC
Philip Asiodu, an Oxford-trained economist and
one of the most influential civil servants in the
Federal Military Government, is clearly the number-
one voice in the formation of Nigerian petroleum
policy. Asiodu is probably the leading theoretician
and advocate of the Nigerian brand of economic
nationalism. He insists that the government must take
steps to insure that important economic sectors are not dominated by foreigners.
Asiodu realizes that Nigerian managers can contribute little to development in
the short run and thus favors joint government-private ventures to take advantage of
foreign expertise. Formation of the NNOC and government equity participation in
foreign oil firms clearly reflect Asiodu's views Although he has been highly critical
of some aspects of US foreign policy, Asiodu is an admirer of American managerial and
technical know-how and strongly favors the introduction of US techniques into
Nigeria. (Confidential)
Shehu Shagari
Commissioner, Ministry
of Finance
Shagari began his active political career in 1964,
when he was elected to the Federal House of Represent-
atives; he has since had extensive parliamentary and
ministerial experience. Shagari graduated from Kaduna
College and was an educator before going into govern-
ment. He was first appointed to the Cabinet in 1970
and became Commissioner for Finance in 1971.
(Confidential)
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Allison Ayida
Permanent Secretary,
Ministry of Finance
One of the most influential permanent secre-
taries, Ayida exerts appreciable influence on
policy decisions, including many that extend
beyond economic affairs. He studied at King's
College, Lagos, and received a B.A. degree with
honors in political and economic planning from
Queen's College, Oxford. He has also done grad-
uate work at the London School of Economics
and holds an M.A. degree from Oxford. He was in
charge of all relief, rehabilitation, and reconstruc-
tion activities at the end of the civil war and was t, main author of the Second
National Development Plan. A pragmatist and strong nationalist, Ayida has shown
no preference for any particular economic or political ideology. (Confidential)
M.O. Feyide
Director, Department of
Petroleum Resources
Ministry of Mines and Power
Feyide is Nigeria's top petroleum expert and the highest ranking official dealing
exclusively with petroleum matters. Educated in mining and petroleum engineering
in the United Kingdom, he has spent his entire career in the Ministry of Mines and
Power. He does not make decisions on important policy questions, but he initiates
policy ideas and makes judgments and recommendations on the proposals of others.
He is widely respected by private oil men for his technical competence and
straightforwardness. Well disposed toward private capital, he believes that Nigeria's
oil benefits can be maximized through operations of experienced foreign companies.
(Confidential)
F.A. Marinho
Exploration and Production
Manager, NNOC
Marinho is the number-two petroleum expert in Nigeria. Prior to his present
position, he was Deputy Director, Department of Petroleum Resources. He has
studied at the University of Ibadan and at Imperial College, University of London.
He also has had on-the-job training with private oil companies in the United
Kingdom and Canada. Marinho works well with foreign oil company officials and
has no apparent bias against private capital. (Confidential)
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This is the eleventh in a series of articles on personalities, institutions, and policies
bearing on petroleum developments in OPEC countries.
The Amir of Qatar, Sheikh Khalifa ibn Hamad al-Thani, makes all final decisions
on oil policy. Supporting him, in a loosely structured arrangement, are his son,
Sheikh 'Abd al-Aziz ibn Khalifa al-Thani, the Minister of Finance and Oil; 'Ali
Jaidah, the Director of Petroleum Affairs; Said Mishal, the Director of Industrial
Planning; Hasan Kamil, the ruler's personal adviser; and, from time to time, the
Foreign Minister and Minister of Information.
Two organizations recently have been established to deal specifically with oil
matters - the Qatar General Petroleum Company (QGPC) and the Joint
Management Committee. QGPC was created in July 1974 to replace the Qatar
National Petroleum Company, which was established in April 1972 but never
commenced operation. The new corporation will administer Qatar's 60% share of
the operating oil companies and will operate the state-owned oil refinery and
fertilizer plant.
The chairman of the QGPC is the Minister of Finance and Oil, 'Abd al-Aziz.
Except for the ruler, all the major participants in petroleum matters are on the
corporation's board. Either Said Mishal or 'Ali Jaidah probably will emerge as the
most influential policymaker next to the Amir.
The position of the Joint Management Committee is still unclear. On paper, the
Committee is responsible for all major decisions concerning the producing fields.
The five-member board includes three representatives from the government and one
each from the two foreign operating companies. The government has 60% of the
votes and the companies, 40%. Decisions are made by a 75% majority. If a majority
is not obtained for a proposed investment project, the government can execute it
alone.
Qatar's production of 520,000 b/d is small by Persian Gulf standards, and its
policies accordingly have little effect on the world oil market. Production increases
recently have restrained conservation measures, rather than holding up prices.
Although loathe to admit it, the Qatar government is strongly influenced by Saudi
views on oil matters. (Confidential)
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QATAR: Petroleum Policymaking Organization
Amir
Sheikh Khalifah
Bin Hamad al-Thani
Advisor to Ruler
Hasan Kamil
Minister of Finance & Oil
Sheikh'Abd al 'Aziz ibn
Khalifs al-Thani
Director of
Petroleum Affairs
'All Jaidah
Qatar General
Petroleum Corp.
Chairman: Sheikh 'Abd al-
'Aziz ibn Khalifa al-Thani
Joint Management
Committee
Director of
Industrial Planning
Said Mishal
UNCLASSIFIED
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Sheikh Khalifa became Amir in February 1972, when he usurped the position
from his cousin, Ahmad ibn Ali al-Thani. He had served as Prime Minister, Foreign
Minister, and Minister of Finance and Oil.
Although Khalifa does not have a deep understanding of petroleum matters, he is
intelligent and energetic in the pursuit of Qatar's interests. Generally well-disposed
toward the United States, the Amir has criticized neighboring states for anti-US
statements. (Confidential)
Sheikh 'Abd al-Aziz al-Thani, Minister of Finance and Oil, is the son of the ruler
and the most promising candidate to be named crown prince. He does not have a
profound knowledge of petroleum matters but is a responsible minister- Any
position he takes can be considered that of the Amir as well.
'Abd al-Aziz was educated in both Engiand and the United States, where he
attended three colleges. He was appointed r)eputy Minister of Finance in the spring
of 1972 and named Minister of Finance and Oil a few months later. (Confidential)
Hasan Kamil, a leading adviser to the Amir, is
directly involved in oil policy. An Egyptian,
Kamil has served the government of Qatar since
1960. A lawyer, educated at the Sorbonne, he
has influenced the organization of the Qatari
government and has understanding of its
functioning.
Kamil has been involved in petroleum matters
since 1960, when he was the Qatari delegate to
the Kuwait Conference of Oil Experts. Since
1962 he served as Qatar's representative to
OPEC. He also is on the board of directors of
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the two foreign operating firms - the Qatar Petroleum Company and Shell Oil
Company of Qatar. (Confidential)
Said Mishal, Director of Industrial Planning, continues to have considerable
influence in oil matters. He previously held the post of Director of Petroleum Affairs
and has become the chief negotiator with the oil companies.
A Palestinian with Saudi citizenship, Mishal was educated at Cairo University and
is a member of Al-Fatah. (Confidential No Foreign Dissem)
'Ali Jaidah became Director of Petroleum
Affairs in 1969. He is the only official in the
Qatari government who fully understands oil
economics and was once its most influential oil
administrator. Somewhat out of favor because
of his outspokenness, Jaidah i.? being eclipsed by
Said Mishal, who previously held the post.
A member of a wealthy family, Jaidah was
educated in the United Kingdom and holds a
Masters degree in economics. (Confidential)n
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King Faysal makes Saudi Arabian oil policy on the basis of recommendations
from some of the best talent in the royal family and from high-ranking commoners
in the government (see the chart). The key actors currently are Ahmad Zaki Yamani,
Petroleum Minister since 1962 and long-time Faysal protege; Prince Fahd, Faysal's
half brother and likely successor; and Hisham Nazir, the country's highly ambitious
planning chief. Faysal makes the final decisions on all major policy questions and
provides guidelines for deciding lesser issues. The actual functioning of Faysal's
circle of advisers is obscure, since a combination of discretion, loyalty, and fear
prompts the participants to conceal the process by which decisions are reached.
In February 1973, Faysal set up a Supreme Petroleum Council to make
recommendations on oil policy and related economic matters. Although the Council
cannot initiate policy, all key issues are fair game for discussion. The Council
debates future oil production levels, downstream investments in the petroleum
industry, oil pricing, auctions, other marketing questions, government participation
in Aramco (the Country's dominant oil company), and even the implementation
of the economic development plan.
The appointment of Prince Fahd and Faysal's son Prince Saud ibn Faysal
to head the Council indicates the King's unwillitigness to loosen the royal family's
grasp on oil policy. Indeed, the Council reportedly was intended to reduce the
authority of Yamani, who was gaining a good deal of control over economic affairs.
The Council is balanced with representatives from government agencies not directly
involved with petroleum matters, such is Minister of State for Planning 1-lisham
Nazir, Minister of State for Foreign Affairs Umar Saggaf,Minister of State for
Finance Aba al-Khayl, and Saudi Arabian Monetary Agency chief, Anwar Ali.
Yamani's Ministry of Petroleum and Mineral Resources, acting through
Petromin - a state corporation - has exclusive jurisdiction in carrying out policies
concerning petroleum. The Ministry establishes production levels, sets prices, and
decides how revenues should be spent and invested. Although the Ministry is highly
independent, reporting directly to Faysal instead of through the ministerial
structure, any new policy action must be presented to the Supreme Petroleum
Council for approval. Rejection by the latter can, of course, be overridden by
the King.
Formed in late 1962 and currently headed by Dr. Abdal-I-tadi Hasan Tahir,
Petromin is charged with develop'ng industries based on petroleum. natural gas,
and minerals.
Petromin is involved in all phases of the oil business. Two of its operating
affiliates are the Arabian Geophysical and Surveying Company and the Arabian
Drilling Company, both of which are joint ventures with foreign firms. Petromin
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SAUDI ARABIA: Petroleum Policymaking Organization
Chairman: Prince Fahd
Secretary General: Prince Saud ibn Faysal
Ahmad Zaki Yamani
Umar Saqqaf
Hisham Nazir
Muhammad Aba al?Khayl
Anwar Ali
President: Hisham Nazir
Deputy: Fayiz Badr
All ministers and ministers of state.
(Not considered a significant
decisionmaking unit)
MINISTRY OF PETROLEUM
AND MINERAL RESOURCES
MINISTRY OF FINANCE
AND NATIONAL ECONOMY
Minister: Ahmad Zaki Yamani
Deputy: Prince Saud ibn Faysal
Governor: Abd al?Hadi Hasan Tahir
Deputy: Prince Saad ibn Faysal
Minister: Prince Musaid
Minister of State: Muhamad Aba al-Khayl
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is particularly active in domestic marketing, a function which received its main
impetus from the purchase of Aramco's small refinery in Jidda in 1964. In 1973,
Petromin became the interim agent for marketing participation crude, the volume
of which will increase greatly as the government moves toward eventual full
ownership of Aramco.
Of the agencies concerned only indirectly with oil policy, Hisham Nazir's
Central Planning Organization (CPO) is emerging as the most important. The CPO --
charged with setting out a comprehensive program for Saudi industrialization -
frequently crosses paths with Petromin. CPO and Petromin both interface with
the Ministry of Finance and National Economy. Under the direction of its
number-two man, Muhammad Aba al-Khayl - the Ministry prepares the national
budget, administers the General Investment Fund that finances Petromin's ventures,
and shares with the CPO the review of investment proposals by other ministries.
Faysal's oil policy, favoring output expansion and reduced prices, has put
him at odds with most other oil producers, who would cut output if necessary
to maintain prices. The King's policy is not supported unanimously in Saudi Arabia;
Yamani, Petromin governor Tahir, and Prince Fahd generally back him. But Nazir,
Aba al-Khayl, and Ali advocate linking oil output to the country's ability to absorb
oil revenues, which would mean cutting back production.
New friction in the advisory group developed with Yamani's proposal to hold
an auction of 1.5 million b/d of oil to force down prices. While King Faysal was
in Egypt, Prince Fahd sided with Yamani's usual antagonists, and the Supreme
Petroleum Council recommended postponing the auction indefinitely. As is often
the case when there is no clear consenus among his advisers, Faysal has been
equivocal on the issue thus far. In any event, the delay in the auction has trimmed
Yamani's sails for the time being. (Secret No Foreign Dissem)
Secret
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Prince Fahd ibn Abd al-Aziz Al Saud
Minister of the Interior
Second Deputy Prime Minister
Chairman of the Supreme Petroleum Council
Fahd is Faysal's half brother and likely
successor as head of the government and,
possibly, as king. He is intelligent and
increasingly ambitious but tends to be more
reflective than decisive. Fahd has no research
staff of his own and has not been too well
informed on complex oil and economic
issues.
Friendly toward the United States,
Fahd is the designated executor of the April
1974 US-Saudi cooperation agreement. He
generally supports Yamini's position on oil
policy but has come cat strongly against the
proposed auction. It is widely believed that a
Fahd-dominated government would dismiss
such officials as Yamani, Nazir, and Tahir
and bring the departure of Aba al-Khayl.
(Secret No Foreign Dissem)
Prince Saud ibn Faysal Al Saud
Deputy Minister for Petroleum Affairs,
Ministry of Petroleum and Mineral Resources
Secretary General of the Supreme Petroleum Council
The fourth of Faysal's eight sons, Prince
Saud ibn Faysal assumed his current post in
June 1971. He also serves as Saudi liaison
officer with OPEC and has attended some
OPEC meetings. Western oil officials have
described Prince Saud ibn Faysal as intell-
igent and competent, but his chief, Yamani,
has expressed reservations about his ability
to nun the Ministry if given the chance.
The Prince earned an economics degree
from Princeton in 1965. He then became an
economic adviser in the office of the
Minister of Petroleum and Mineral Re-
sources. Although Prince Saud ibn Faysal is
considered Yamani's likely successor, recent
rumors suggest he may resign his position to
further his education. (Secret No Foreign
Dissem)
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ecre
Ahmad Zaki Yamani
Minister of Petroleum and Mineral Resources
Member of the Supreme Petroleum Council
Yamani has been Petroleum Minister
since 1962. An experienced lawyer and
skillful negotiator, he is the principal Saudi
spokesman on the use of oil as a weapon
against Western support of Israel and travels
frequently to deliver the message.
Yamani believes that Saudi Arabia must
diversify its economy and create a substitute
for oil income; he has said that, in selling oil,
he will favor companies willing to invest in
his country. He continually asserts that
Saudi Arabia might not expand its oil
production unless the United States creates
the "right political atmosphere" in its policy
toward Israel. At the same time, he is the
major proponent of reduced oil prices and a
long-term increase in production to 15
million b/d.
Yamani was born in Mecca. He earned a law degree from Cairo University in 1951
and a master's degree in law from New York University in 1955. He then studied
international law and finance at Harvard. Returning to Saudi Arabia in 1957, he
practiced law and served as a part-time legal consultant to the government until he
joined the government in 1958. (Confidential No Foreign Dissem)
57
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Secret
Abd al-Hadi Hasan Tahir
Governor, General Organization for Petroleum
and Minerals
(Petromin)
Holder of a PhD from the University of
California, Tahir has headed Petromin since
its creation in 1962. Industry officials have
described him as one of the few Arabs who
really understand the integrated structure
and economics of the international oil
business. Tahir is the chief Petromin repre-
sentative to OPEC and OAPEC and serves on
the boards of directors of Petromin subsidi-
aries.
Honest, intelligent, and dynamic, Tahir
is an effective administrator and negotiator.
He has been highly praised by Arabs and
Westerners alike. In April 1973, one US
official claimed that Tahir was the most
important oil man in Saudi Arabia after
Yamani. A policy executor rather than a policymaker, he tends to side with Yamani on
oil policy matters. (Secret No Foreign Dissem)
68
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Hisham Nazir
Minister of State and President of the Central Planning Organization
Metnk of the Supar^me Petroleum Council
Although planning head since 1968,
Nazir has had substantial experience in
petroleum. Armed with an M.A. in political
science from UCLA, Nazir became assistant
legal adviser in the Directorate General of
Petroleum and Mineral Affairs in 1958. He
was appointed representative to the Board of
Governors of OPEC in 1961. Nazir served as
director general of the Ministry of Petroleum
and Mineral Resources from September
1962 to February 1968. In January 1965, he
became a member of the board of the
Arabian Oil Company, a Japanese company
operating Saudi concessions in the neutral
zr-ne.
Nazir is believed to be Faysal's unof-
ficial adviser on international economic
affairs. He has been extremely aggressive in recent months, trying to seize :aadership of
those policy areas brought to prominence by the country's spiraling oil revenues and
reserves. Nazir and his planners find themselves in conflict with Petromin over the
specifics of a national strategy for industrialization. He is the leading advocate of
regulating oil production according to the country's ability to absorb oil revenues and
ind.:strialize. (Secret No Foreign Dissem)
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ecret
Muhammad ibn Ali Aba al-Khayl
Minister of State for Finance and National Economy
Member of the Supreme Petroleum Council
Aba al-Khayl has been Minister of State
for Finance and National Economy since
February 1972, when King Faysal created
the post to lessen ultra-conservative Prince
Musaid's control over financial matters. A
bright, highly motivated, honest official, he
has risen rapidly since joining the civil service
in the late 1950s. He is destined to play a
major role in implementing the US-Saudi
cooperation agreement announced in April
1974.
A member of an aristocratic Najdi &r '
family, Aba al-Khayl received a degree in e w '
commerce from Cairo University in 1951. As
Deputy Minister and later Vice Minister of
he handled the day-to-day affairs of the Ministry. His promotion to Minister of State
was regarded as a reward for ability and hard work.
As a member of the Supreme Petroleum Council, Aba al-Khayl sides with CPO
head Nazir in wanting to limit oil production levels. He believes Saudi Arabia should
not increase oil production just to please the West. (Confidential No Foreign Dissem)
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Secret
UNITED ARAB EMIRATES
The United Arab Emirates (UAE) is a federation of seven sheikhdoms - Abu
Dhabi, Ajman, Dubai, Fujairah, Ras al Khaimah, Sharjah, and Umm al Qaiwain.
Only three - Abu Dhabi, Dubai, and, since July 1974, Sharjah - are oil producers.
The UAE currently produces 2 million b/d of crude oil, making it the fourth largest
Gulf producer. Abu Dhabi contributes the lion's share, 1.7 million b/d, while Dubai
adds another 240,000 b/d. Sharjah began production at an initial rate of
50,000-60,000 b/d and is expected to boost output to 240,000 b/d in 1975.
The federal government has little real power over petroleum matters. Effective
control has been retained by the individual sheikhs. Sheikh Zayid ibn Sultan
al-Nuhayan of Abu Dhabi, Sheikh Rashid ibn Sa'id ibn Maktum al-Falasa of Dubai,
and Sheikh Sultan ibn Muhammad al-Qasimi of Sharjah are the chief oil
policymakers for their share of UAE output. Abu Dhabi holds the key posts in
the UAE government as well as the power of the purse. Under the federal
constitution, control over oil an!,"' mii?ral exploitation activities remains the
exclusive domain of the individual states.
A federal Ministry of Oil and Mineral Wealth was established at the end of
1973 to deal with OPEC and OAPEC policy matters. The Ministry's power is limited
because it does not control oil revenues and because the sheikhs are not bound
by its decisions. A new federal corporation - The Federal Company for Oil
Distribution - was established in April 1974 to sell petroleum products in the
seven emirates. The new company is operated by the officials of the former Abu
Dhabi Company for Oil Distribution, which was abolished with the formation of
the federal company.
Only in Abu Dhabi is there any evidence of a formal line of authority that
extends beyond the ruler and his personal advisers. The UAE Minister of Petroleum,
Mani' Utayba, is the head of the Abu Dhabi Department c: Petroleum Affairs,
formerly the Abu Dhabi Ministry of Petroleum and Industry. The department is
responsible for managing Abu Dhabi's relations with the operating companies,
implementing OPEC and OAPEC decisions in Abu Dhabi, and allotting new
concessions. The complex of activities being managed and coordinated by the
department surpasses its present technical and administrative competence, especially
in the international marketing field.
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UAE: PETROLEUM POLICYMAKING ORGANIZATION
Emirate of AJMAN
(Non-Producer)
Emirate of FUJAIRAH
(Non-Producer)
Ruler: Sheikh Zayid
Ibn Sultan AI-Nuhayan
Abu Dhabi National Oil Company
Chairman:
Sheikh Tahnoon Bin
Muhammad Al-Nuhayan
Dep. Chrm:
Mani' Sa'id Al-Utayba
General Manager:
Dr Mahmoud Al Hamra Krouha
Emirate of
RAS AL KHAIMAH
(Non-Producer)
Ruler: Sheikh Rashid Ibn
Said Ibn Maktum Al-Falasa
President:
Sheikh Zayid Ibn
Sultan AI-Nuhayan
Vice President:
Sheikh Rashid Ibn Said
Ibn Maktum AI-Falasa
Ministry of
Oil and Mineral Wealth
Mfni-;ter:
Mani' Said Al Utayba
Ruler: Sheikh Sultan Ibn
Muhammad AI-Qasimi
Emirate of
UMM AL QAIWAIN
(Non-Producer)
Personal Representative
of President of UAE
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The Abu Dhabi Naticnal Oil Company (ADNOC), established in 1971,
represents the government's share of participation in foreign oil companies operating
in Abu Dhabi. The company also negotiates the government's oil sales, recommends
establishing affiliates, sets up development projects, and enters into partnerships
with other companies (two affiliate companies under the ADNOC engage in
exploration activities and the manufacture of oil-related equipment). Company
policy is set by a Board of Directors, headed by Sheikh Tahnoon Muhammad
al-Nuhayan with Mani' Utayba as Deputy Chairman. Day-to-day operations are
handled by Dr. Hamra Krouha, the General Manager, an Algerian on loan from
Sonatrach - the Algerian state oil company.
Recent policy statements by Mani' Utayba on prices and output indicate that
the UAE (at least Abu Dhabi) plans to maintain the present level of crude oil
prices. Thus far, Abu Dhabi has made no move to cut production levels. In fact,
it has increased output in recent months and has made plans to expand production
to 2.23 pillion b/d by early 1975. These plans probably will have to undergo
reassessment if the participation agreement currently und- egotiation with the
Abu Dhabi Petroleum Company (ADPC) does not guarai. . a market for Abu
Dhabi's share of production. In the most recent conversations of Abu Dhabi and
US government officials, Utayba conceded that Abu Dhabi would be forced to
cut production if unabic to market the oil. (Secret No Foreign Dissem)
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Secret
Zayid ibn Sultan al-Nuhayan
President, UAE
Sheikh Zayid, ruler of Abu Dhabi since 1966, is also President of the UAE. Elected
in December 1971 for a five-year term, he had served since 1969 as President of the
Federation of Arab Emirates, predecessor to the UAE. He is clearly the dominant
figure in the UAE and probably the only sheikh who really cares about the federation.
He wants badly to be accepted on equal terms by the top leaders of the Arab world, and
he is willing to commit funds to various Arab states to achieve this aim.
While Sheikh Zayid has had differences with Saudi Arabia, he has agreed with King
Faysal on oil matters. In August 1974 he settled a longstanding border dispute with
Saudi Arabia and appears to be ready to follow the Saudi lead on oil policy.
(Confidential)
Rashid ibn Sa'id ibn Maktum al-Falasa
Vice President, UAE
Sheikh Rashid was proclaimed ruler of Dubai in
1958. In addition, he is Vice President of the UAE
and head of the UAE currency board. He has neither
the wealth nor the generosity of Sheikh Zayid.
Nonetheless, he has succeeded in turning Dubai into
a dynamic commercial center in little more than a
decade.
He is well acquainted with the technical details
of oil operations and has an excellent grasp of
commercial matters. He is inclined to pursue an
independent path from Abu Dhabi, yet he generally
can be counted on to follow the lead of the major oil
producers. (Confidential)
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Sultan ibn Muhammad al-Qasimi
Ruler of Sharjah
Sheikh Sultan became the ruler of Sharjah in
January 1972, following the assassination of his
brother and predecessor. Sheikh Sultan, 32, a
newcomer to oil wealth, has only meager experi-
ence in government but seems to have a good grasp
of the problems of development and modern
society. He can discuss technical subjects on a
fairly high level. Since the discovery of oil, Sheikh
Sultan has shown great interest in attracting US
business to Sharjah, both to participate in local
developi;1ent projects and to invest in projects such
as hotels and oil-related service facilities.
Sheikh Sultan graduated from the University of
Cairo with a degree in agronomy. (Confidential)
Mani' Sa'id al-Utayba
Minister of Oil and Mineral Wealth, UAE
Chairman, Department of Petroleum Affairs, Abu Dhabi
Deputy Chairman, Abu Dhabi National Oil Company
Mani' Utayba, about 28, became Abu Dhabi
Minister of Petroleum and Industry (now Depart-
ment of Petroleum Affairs) when the first Abu
Dhabi cabinet was formed in July 1971. He has
been managing Abu Dhabi petroleum interests
since 1969. He became the UAE Minister of
Petroleum in late 1973 when emirate ministries
were consolidated into the federal cabinet. Active
in Arab oil politics, he has been involved in the
affairs of both OPEC and OAPEC. He is also the
Deputy Chairman of the Abu Dhabi National Oil V
Company (ADNOC) and a member of the board of
the joint Abu Dhabi-Japanese Abu Dhabi Oil
Company (ADOC).
Secret
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Utayba enjoys the confidence of the ruler of Abu Dhabi, Sheikh Zayid. This
confidence is not shared, however, by Western oil company officials, who regard him
as arrogant and poorly informed about oil affairs. He admires the ability and style of
Saudi Oil Minister Yamani and seeks to gain the same kind of respect which Yamani
enjoys in international oil circles. He strongly advocates direct sale by Abu Dhabi of
its crude oil, bypassing the oil companies.
Utayba was the first Abu Dhabian to earn a college degree. He received a degree
in economics from the University of Baghdad in ! 969. (Confidential)
Tahnoon Bin Muhammad al-Nuhayan
Chairman, Board of Directors, Abu Dhabi National Oil Company
Sheikh Tahnoon al-Nuhayan, now chairman of
the board of directors of the Abu Dhabi National
Oil Company, is also the Minister of Municipalities
and Agriculture and previously was Governor of
Abu Dhabi's --'astern Province. He is one of the
harder working and more intelligent of the junior
sheikhs and exerts considerable influence within
the Abu Dhabi leadership. He is pro-Western and
will forcibly press his opinions once convinced. He
is a neophyte in the oil business, however, and
probably will lean heavily on the advice of Mall-
moud al Hamra Krouha, the new general manager
of ADNOC. (Secret No Foreign Dissem)
Mahmoud al Hamra Kroulia
General Manager, Abu Dhabi National Oil Company
Dr. Hamra Krouha, an Algerian on loan from Sonatrach-the Algerian state oil
company-is the new general manager of the Abu Dhabi National Oil Company
(ADNOC). About 36 years old with a Ph.D. from the Sorbonne in economics, he
"/as director of planning at Sonatrach until loaned to Abu Dhabi.
Secret
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creT
He plans to strengthen the position of ADNOC by bringing in more highly
skilled staff, primarily Algerians, and probably will reorganize the company along
the lines of Sonatrach. He seems reasonably well disposed toward the United States
and has indicated he favors discussions between producer and consumer govern-
ments on the whole problem of equitable oil prices and on related issues. (Secret No
Foreign Dissem)
`Adnan Muzahim al-Pachachi
Member, Board of Directors, Abu Dhabi National Oil Company
`Adnan Pachachi, an Iraqi, became the per-
sonal representative of the president of the UAE in
January 1974. He is also a member of the Board of
Directors of the Abu Dhabi National Oil Company.
He has held posts in the Abu Dhabi government,
including that of Minister of State, since mid-1969.
He went to Japan in December 1973 as part of an
Abu Dhabi delegation to explain post-war Arab oil
policy. Although an Arab nationalist, his political
inclinations are moderate. He was Iraq's Foreign
Minister then Permanent Delegate to the UN until
1969, when lie resigned because of political disa-
greement with the Iraqi Ba'ath regime.
He has a Ph.D. in political science from Georgetown University. He is the
cousin of Nadirn al-Pachachi, formerly oil adviser to Sheikh Zayid. (Confidential)
Secret
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VENEZUELA
On his inauguration as president of Venezuela six months ago, Carlos Andres
Perez pledged to bring the nation's oil industry under state control. He promised
a carefully prepared nationalization on terms backed by a national consensus. The
oil policy of the new administration is tied to the planning for nationalization,
which Perez intends to begin implementing next year. Perez created a special
non-partisan body, the Petroleum Reversion Commission, to study nationalization
issues and make recommendations to him by 23 November.
Perez keeps a tight rein on petroleum policymaking. A shrewd politician, he
listens to the advice r'f experts and then makes the major decisions on his own.
He is a strong supporter of high prices and conservation of Venezuelan petroleum
resources.
Several cabinet members serve as key advisers to Perez. Gumersindo Rodriguez,
perhaps the most powerful minister, directs the Central Office of Coordination
and Planning, which has responsibility for shaping overall economic policy. Hector
Hurtado, Minister of Finance, also has a key role in economic policymaking. Both
Rodriguez and Hurtado are members of the Reversion Commission. Manuel Perez
Guerrero, Minister of State for International Economic Affairs, is the chief
negotiator with foreign-owned companies and is one of the President's closest
advisers. He thus is directly involved in nationalization matters.
The Ministry of Mines and Petroleum conducts studies and writes position
papers but handles lesser policy matters. The ministry is essentially nonpolitical,
and the new administration has made few changes in its personnel. Valentin
Hernandez Acosta, the Minister of Mines and Petroleum and President of the
Reversion Commission, is primarily an executor of policy.
The state oil company, CVP, already is important in domestic marketing of
petroleum products and plays a minor role in production and refining. Carlos
Carvenali, Chief E;;ecutive Officer of CVP as well as Vice President of the Reversion
Commission and Chairman of the commission's coordinating committee, apparently
has little influence on policymaking.
The Reversion Commission consists of 36 members representing a broad
spectrum of Venezuelan public life, including the Congress, the armed forces,
political parties, labor, business, banking, universities, and other professional groups,
as well as petroleum experts. The commission is organized into a coordinating
committee, headed by Carvenali, and five working subcommittees responsible for
69
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Secret
Director of National Planning Minister of Finance
Gumersindo RODRIGUEZ Gil Hector HURTADO Navarro
Minister of State
for International Economic Affairs
VENEZUELA: Petroleum Policymaking Organization
Ministry of Mines and
Petroleum
Minister:
Congressional Committee on Mines
President:
Arturo HERNANDEZ Grisanti
Vice President:
Carlos CARVENALI
HERNANDEZ Grisanti,
HURTADO,
RODRIGUEZ
Director General:
Fernando BAEZ Duarte
I
Technical CVP Director:
Office of Carlos
Hydrocarbons CARVENALI
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(a) operations, (b) energy resources, (c) legal organization, (d) economics and
finance, and (e) labor and human resources. Despite President Perez' hope for
harmonious proceedings, sharp disagreements have developed over details of the
draft nationalization bill.
Considerable knowledge on petroleum matters is available to the President
from within his own party, the Action Democratica (AD). This party, which now
commands a majority in both houses of Congress, has originated much of
Venezuela's nationalistic legislation in recent years. The AD's leading oil expert
in Congress, who heads the Congressional Committee on Mines and is a member
of the Reversion Commission, serves as a link between Congress and the President.
Several nongovernmental advisers also influence oil policymaking. These
include the widely respected Juan Pablo Perez Alfonso, the experienced negotiator
Julio Sosa Rodriguez, former President Romulo Betancourt, and Venezuelan
officials in the petroleum industry.
The country's international oil policy continues to be characterized by cautious
cooperation with OPEC, which Venezuela helped establish. Caracas has long
advocated production controls to maintain prices. While the government
occasionally has expressed interest in a bilateral agreement with the United States,
recent events have convinced the Perez administration that OPEC serves Venezuelan
interests better. (Confidential)
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Gurnersindo RODRIGUEZ Gi;
Director of National Planning
An outstanding economist, Gumersindo
Rodriguez, 41, has been serving as Director of
National Planning (a cabinet-level post) since
March 1974. As such, he heads the Central Office
of Coordination and Planning (CORDIPLAN),
the powerful agency involved in the formulation
of economic policy. One of the leading architects
of the economic measures taken by President
Perez, Rodriguez is a long-time member of the
Democratic Action (AD) party and has been
called the "economic wizard of AD." He is a
member of the Petroleum Reversion Commission.
Rodriguez studied at the University of
Manchester and at the London School of Eco-
nomics, where he received a master's degree. He previously served as coordinator of
fiscal and monetary policy in the Ministry of Finance and as a member of the Finance
Commission in the Chamber of Deputies. (Unclassified)
Hector HURTADO Navarro
Minister of Finance
Hector Hurtado, 56, a top economic adviser
in the Democratic Action party, has been Minister
of Finance since March 1974. Much of the radical
tone of President Perez' economic policies can be
traced to the influence of Hurtado, who has
strong nationalistic views. For several years he
head; d the Central Office of Coordination and
Planning, the post now held by Gumersindo
Rodriguez. Intelligent and tough, Hurtado is a
member of the Reversion Commission and has
major influence on petroleum policy. (Unclas-
sified)
72
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Secret
Manuel PEREZ Guerrero
Minister of State for International Economic Affairs
A brilliant economist and one of Venezuela's
outstanding specialists in international planning,
Manuel Perez Guerrero, 63, assumed the new
cabinet-level position of Minister of State for
International Economic Affairs in April 1974.
Referred to by some observers as the eminence
grise of the Cabinet, he is highly regarded by
President Perez and has considerable influence on
economic thinking and planning in the govern-
ment. He is well-versed in petroleum matters and
is one of the administration's chief advisers on
nationalization. Objective and forthright, Perez
Guerrero has been characterized as a realist and an
admirer of US economic progress, but first of all
as a sincere Venezuelan nationalist.
Perez Guerrero received a doctorate in law and economics from the University of
Paris in 1936. He served as Ambassador to the United Nations in 1967-68 and as
Secretary General of the UN Conference on Trade and Development from September
1968 to March 1974. (Confidential)
Valentin HERNANDEZ Acosta
Minister of Mines and Petroleum
A petroleum engineer who has had several
diplomatic assignments, Valentin Hernandez
Acosta, 48, became Minister of Mines and
Petroleum on 12 March 1974. Although intel-
ligent and knowledgeable about his job, he is
regarded by some as more an executor than a
formulator of policy. Currently, he chairs the
Reversion Commission. He apparently favors a
form of nationalization that will give Venezuela
visible ownership and control of the industry-a
political necessity-with minimal disturbance to
its operational structure.
Hernandez received a degree in petroleum
engineering from the Central University in Cara-
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cas and subsequently studied at the London School of Economics and at Sir John Cass
College in London. His appointment as Ambassador to Libya, Tunisia, and Morocco
(1965-69) was designed to promote cooperation with those countries, particularly in
petroleum matters. (Confidential)
Arturo HERNANDEZ Grisanti
President, Congressional Committee on Mines
Arturo Hernandez Grisanti, 47, is a Deputy
of the Democratic Action party. In oil matters,
few Venezuelans are as well informed as he.
Although his opinions carry considerable weight,
he is not directly involved in policymaking.
Hernandez is nationalistic on oil matters and
highly critical of US oil policies and oil com-
panies.
Hernandez received a degree in law and a
doctorate in political science from the Central
University of Venezuela. He served for a time as a
cabinet director in the Ministry of Mines and
Petroleum, where he was Acting Minister on
several occasions. (Confidential)
Juan Pablo PEREZ Alfonzo
Petroleum Adviser
The original architect of Caracas' oil policy
and one of the founders of the Organization of
Petroleum Exporting Countries, Juan Pablo Perez
Alfonzo, 71, is considered the high priest of
Venezuelan petroleum matters. Although Perez
Alfonso does not have a government post, his
views are widely publicized and have considerable
influence. He favors a highly nationalistic oil
policy and has called for a reduction in petroleum
production to keep the country from being
flooded with money.
Perez Alfonzo served as Minister of Develop-
ment from 1945 to 1948. He initiated the 50-50
oil revenue split between the government and the
oil companies. He was Minister of Mines and Petroleum from 1950 to 1963. Perez
Alfonzo has written extensively on energy-related matters. (Unclassified)
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Julio SOSA Rodriguez
Petroleum Engineer
Julio Sosa Rodriguez is a petroleum engineer
with long experience as a government adviser and
negotiator. He served as Ambassador to the
United States from 1969 to 1972 at the request of
his close friend, former President Rafael Caldera.
A political independent, Sosa has long
supported Caldera's Social Christian party and
could be a valuable bridge between the previous
administration and the Democratic Action admin-
istration in the oil reversion negotiations. He
probably will be a key adviser in the government's
planning of nationalization. A moderate nation-
alist and defender of private enterprise, he is able
to recognize the pros and the cons of specific
nationalization proposals.
Sosa was born in France and educated in England, the United States, and
Venezuela. He served as the chief negotiator for Venezuela's February 1973 entry into
the Andean Pact. (Confidential) e
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Major oil policy decisions are made by Prime Minister Bratteli, with the support
of his cabinet. Minister of Commerce and Shipping Evensen, an advocate of
international cooperation to solve the energy crisis, is the leading oil expert.
Responsible for the issuance of drilling licenses, his office controls the pace of
exploration and development of Norway's North Sea reserves. Oil revenues and
their impact on the domestic economy are dealt with in the Finance Ministry headed
by Per K;Lppe, who advocates complete state control of the oil industry. Minister
of Foreign Affairs Frydenlund takes an active role in energy consultations with
other countries.
The Bratteli government is taking a cautious approach to oil development.
Fearing rampant inflation and an influx of foreign labor, most Norwegians oppose
rapid expansion of oil production. There is also widespread concern over
environmental damage from oil drilling. Oslo nevertheless will find it difficult to
hold producti^n to the I million b/d ceiling set for 1980. Because it must develop
the large Statfjord field and other deposits adjoining the United Kingdom's North
Sea holdings to prevent draining from the British side, output probably will exceed
1.5 million b/d by the turn of the decade.
The government has formed a state-owned oil company - Statoil - and given
it exclusive drilling rights north of the 62d parallel. Statoil probably will receive
a large share of any new licenses granted farther south as well. Its director, Arve
Johnsen, believes that Statoil should have complete control of all oil exploration
and development in the, North. Sea. The government also owns a controlling interest
in Norsk Hydro, a leading company in development of drilling technology. Norsk
Hydro controls several large drilling sites south of the 62d parallel.
Several private petroleum firms, including Phillips, Exxon, She!', Mobil, and
Norway's Saga Petroleum, hold drilling licenses south of the 62d parallel. Although
the government has granted no new licenses in the past year, several tracts will
be opened for bids in the near future. Recent legislation empowering the
government to buy up to 50% in a company's operations may dampen investors'
interest.
Norway, as the only West European net oil exporter, sees itself as a mediator
between producing and consuming nations. Its refusal to join the International
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Norway: Petroleum Policymaking Organization
Prime Minister
Trygve Bratteli
Minister of Industry
and Commerce
Jens Evensen
Finance Minister
Per Kleppe
Minister of Foreign Affairs
Knut Frydenlund
Energy Program as a full member stemmed partly from a desire not to be aligner]
with either group. Oslo's prime concern, however, is to assure national coi: trol
over its oil resources. (Confidential)
Trygve Brattell
Prime Minister
Party chairman since 1965, Trygve I3ratteli became Prime Minister of a
minority Labor Party government for the second time on 16 October 1973. 1-:e
had previously filled the post from March 1971 through October 1972. Now 64
s'.
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years old, Bratteli is a man of wide political experience. He has been a member
of Parliament for 25 years and has held cabinet '. ositions in previous governments
as Minister of Finance (1951-55 and 1956-60) and Minister of Transportation and
Communications (1963-64).
Norway did not join the International Energy Program, but Bratteli himself
advocated membership. He is personally friendly toward the United States.
(Confidential)
Jens Evenson
Minister of Commerce and Shipping
A successful lawyer and internationally
respected oil expert, Jens Evensen, 56, became
Minister of Commerce and Shipping in October
1973. He had previously served for 12 years as
director general of the Legal Affairs Department
in the Foreign Ministry. Evenson's appointment
was probably a concession to the anti- -.uropean
Community wing of the party.
As Minister of Commerce and Shipping,
Evensen has overall responsibility for oil manage-
ment. He has participated in numerous meetings
on exploitation of North Sea and continental
shelf oil. He led his country's delegation to the UN Law of the Sea Conference in
December 1973 and has recently finished a book on international oil politics. Qualified
and ambitious, he can be expected to be forc3ful in international oil discussions.
Evensen believes that Norway's unique position-a neutral in the Middle East
conflict, a non-memo-::- of EC, and a potential exporter as well as importer of
petroleum-qualifies Oslo to act as an "honest broker" between the producing and
consuming states.
Evensen believes that a solution to the energy crisis can be best obtained
through multilateral cooperation. He views the oil situation as too complex to be
handled by private petroleum companies; its economic and foreign policy
implications require government involvement. He feels that the current oil crisis
derives only in part from producers' actions.
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Evensen has a very strong and independent personality, with pronounced
idealistic and moralistic leanings. His tendency to act in a freewheeling manner has
irritated more conventional officials in the Foreign Ministry and caused problems in
his present position. Evensen sometimes makes statements and adopts measures not
entirely in line with other Norwegian policies.
Evensen holds a law degree from the University of Oslo (1942) and also studied
at Columbia University and the University of Minnesota (1947). He attendee!
Harvard under a Rockefeller Grant in 1952-53 and earned an LL.D. from the same
school in 1968. Prior to entering the Foreign Ministry in 1961, Evensen had a
thriving law practice and had acted as counsel for the Norwegian government before
the International Court of Justice and before various ad hoc international tribunals.
(Secret)
Per Kleppe
Minister of Finance and Customs
Per Kleppe, 51, became Minister of Finance
and Customs in October 1973. He had served in
the first Bratteli government as Minister of
Commerce and Shipping. Kleppe filled the
one-year interim between labor governments by
returning to his former post (1967-71) as head of
the labor movement':, research office. In that
position, he formulated economic and social
policy for the Labor Party and the Norwegian
Trade Union Federation.
One of the lei ding economists in Norwegian
politics, Kleppe is second only to Bratteli as the
Labor Party's leading policymaker on economic
and financial matters. He is slightly leftist in his economic views, favoring strong state
control. A key man in the formulation of Norwegian oil policy, K_.eppe supports a
"go slow" approach to North Sea exploitation. He is believed to have a positive
attitude toward the United States.
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Knut Frydenlund
Minister of Foreign Affairs
Knut Frydenlund, 47, assumed his duties as
Foreign Minister in October 1973. A diplomat
for 15 years before his election to Parliament in
1969, he holds excellent credentials for his
current post. He s rved as vice chairman of, the
Foreign Relations Committee in Parliament. As
chairman of the Labor Party's International
Affairs Committee, Frydenlund is a leading
ideologue on international and security matters.
He represents the moderate center of the party.
As a young diplomat, Frydenlund served in
Bonn and Brussels and at the Council of Europe.
For many years, he was private secretary to the late Foreign Minister Halyard Lange.
In 1968, Frydenlund visited the United States on an International Visitors' Program
grant. He returned in November 1973 for discussions with US Secretaries of State
and Defense and again in February 1974 to attend the Washington Energy
Conference, where he advocated joint consumer and producer cooperation. (Secret)
A.rve Johnsen
Director, Statoil
Arve Jolmsen became the first director of Statoil in December 1972. Previously,
he was an employee of Norsk Hydro (196:. -71) and served as State Secretary in the
Ministry of Industries in the first Bratteli government (1971-72). In his ministerial
position, he played a central r')1F in shaping oil policy. Johnsen views Statoil as the
government's arm in commercial matters cnd as an instrument for the economic
development of Norway.
Johnsen is a graduate of the State College of Business Administraticn and
Economics in Bergen (1957). He earned an M.A. degree in economics at the
University of Kansas in 1960 and later completed his law degree at the University of
Oslo. (Unclassified)o
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