History of petroleum industry in Iraq

[5] The driving force behind TPC's creation was Gulbenkian, while the largest single shareholder was the British Government-controlled Anglo-Persian Oil Company, which held 50% of the shares by 1914.

TPC received a promise of a concession from the Ottoman government but the outbreak of World War I in 1914 put a stop to all exploration plans.

Writer and former IPC employee Stephen Hemsley Longrigg noted that "[T]he Red Line Agreement, variously assessed as a sad case of wrongful cartelization or as an enlightened example of international co‑operation and fair-sharing, was to hold the field for twenty years and in large measure determined the pattern and tempo of oil development over a large part of the Middle East".

[10][11] TPC shares were held in the following proportions: 23.75% each to the Anglo-Persian Oil Company, Royal Dutch/Shell, the Compagnie Française des Pétroles (CFP), and the NEDC; the remaining 5% went to Calouste Gulbenkian.

[12] After Muhammad Mossadegh nationalized the oil industry in Iran, IPC agreed to accept an "equal profit sharing" arrangement in 1952.

After seizing control of the Iraqi government, Qasim demanded better terms from IPC but decided against nationalization of Iraq's petroleum assets.

By this time the Ba'ath Party was in power in Iraq and Saddam Hussein was its de facto ruler, although Ahmed Hassan al-Bakr did not formally step down as president until 1979.

Iraqis remained divided over provisions allowing regional governments to enter into contracts directly with foreign companies; while strongly supported by Kurds, Sunni Arabs wanted the Oil Ministry to retain signing power.

As a compromise the draft law proposed that a new body called the Federal Oil and Gas Council would be created that could, in some circumstances, prevent execution of contracts signed by regional governments.