TALABANI OPTIMISTIC ABOUT HYDROCARBON LAW,

C O N F I D E N T I A L SECTION 01 OF 03 BAGHDAD 002047

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E.O. 12958: DECL: 06/20/2017
TAGS: PREL PGOV PINS IZ TU
SUBJECT: TALABANI OPTIMISTIC ABOUT HYDROCARBON LAW,
CONCERNED ABOUT SECURITY

Classified By: Ambassador Ryan C. Crocker for reasons 1.4 (b) and (d).


1. (C) SUMMARY. During a June 12 lunch with Deputy
Secretary Negroponte, President Talabani said he would engage

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the Turkish Government in an attempt to reduce tensions along
Iraq's northern borders but dismissed the idea of GOI
military action against PKK elements in Iraq. President
Talabani remarked that poor communication between PM Maliki
and the United States military command impacted the
effectiveness of the Iraqi Army. While Talabani seemed
optimistic that key hydrocarbon legislation would pass in the
Iraqi Council of Representatives (CoR) "before the end of the
month", he suggested the only way to ensure passage of other
legislative and reconciliation benchmarks would be for Iraq's
top five political leaders to meet and make the decisions
themselves, bypassing the assembly. END SUMMARY.


2. (SBU) The meeting took place at the President's official
residence. United States representatives included the Deputy
Secretary, Ambassador Crocker, S/I Satterfield and the PAO.

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Iraqi participants included President Jalal Talabani;
Minister of Water Resources Dr. Latif Rashid, and CoR Kurdish
Alliance Chairman Fuad Massoum.

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TURKISH BORDER ISSUES-DIALOGUE WITH TURKEY, BUT NO MILITARY
ACTION AGAINST PKK
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3. (C) Ambassador Negroponte emphasized the Government of
Iraq (GOI) needed to do "the utmost" to avoid giving Turkey
even a pretext for a cross-border operation. President
Talabani replied that the Turkish Army was engaged in a
propaganda campaign and, in an election year, wanted to
portray itself as "the defender of the Turkish public".
Talabani added the GOI was cooperating with Turkey and that
it had shut down PKK offices in Kurdistan's major cities at
Turkey's request. However, Talabani ruled out Iraqi military
action against the PKK saying the Iraqi Army could neither
successfully fight the PKK in the mountainous terrain of
northern Kurdistan nor spare the assets for such an
operation. Talabani said that the Turkish military is behind
Turkey's bellicose stance, but that the civilian leadership,
and in particular the MIT (Turkish CIA equivalent) opposed a
military operation on the grounds that it would quickly
become a quagmire for the Turkish Army. Talabani noted the
Turks refused to work with a tri-partite commission (United
States, Iraq, Turkey) established to deal with northern
border issues, because one of the assistants to the Iraqi
representative is a Kurd. Talabani closed by saying he would
talk with the Turks and that he thought of the PKK generally
as "trouble makers."

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SECURITY ISSUES--PROBLEMS AT THE TOP ARE A CONCERN
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4. (C) President Talabani said that he had observed some
progress in the security situation in Baghdad. He attributed
this progress to both the Iraqi Army's (IA) improved
effectiveness and a greater reliance on Kurdish units to
conduct security operations in Shi'a and Sunni areas.
However, he said gains were often temporary because
insurgents invariably returned to cleared areas as soon as
military assets moved on. Of greater concern to Talabani
seemed to be what he described as a "lack of consultation"
between Prime Minister Nouri Al-Maliki and Commanding General
David Petraeus. Talabani said that Maliki viewed some of the
people with whom General Petraeus wished to work as
unreformed Ba'athists, particularly in Ninewah province. He
also blamed equipment, communications, and transport
shortages on inefficiencies at the highest command levels.


5. (C) Ambassador Crocker pointed out that he and the CG
met with the PM weekly. Ambassador Crocker noted that the
USG had provided equipment far beyond what the PM had
described to Talabani, but that it was likely that the Iraqi
Ministry of Defense still had not distributed them. Talabani
countered by citing initiatives stalled by poor coordination
at the highest command levels: the IA's pending efforts to
recruit and train an additional thirty thousand soldiers and
plans to form another Republican Guard unit. Ambassador
Crocker said practical considerations limited the number of
new recruits the IA could train and added that with current
shortfalls in the IA's officer corps would limit the growth
of the IA. However, both Deputy Secretary Negroponte and
Ambassador Crocker reiterated USG support for a 12 division
Iraqi army. Talabani said he thought Maliki was unsure
whether senior US commanders backed this objective.


6. (C) President Talabani mentioned that Al-Qaeda
controlled a number of areas in Baghdad, and Iraqi Christians

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were among the groups they specifically targeted. Talabani
added that many had fled to Kurdistan. Ambassador Crocker
noted recent efforts to use local groups to counter the
Al-Qaeda threat. President Talabani reacted strongly saying
under no circumstances should we work with "gangs of
criminals" that we ultimately will not be able to control.
Talabani argued the IA could be doing the fighting and
emphasized how important it is in
counter-insurgency/counter-terrorist operations to maintain
the support of local populaces and command of whole areas.

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BENCHMARK LEGISLATION AND CONSTITUTIONAL REVIEW--PARTY
LEADERS MUST MAKE THE DEALS
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7. (C) Ambassador Crocker asked whether the political
leadership supported the May 23 Constitutional Review
Committee (CRC) recommendations. CRC Vice Chairman Fuad
Massoum answered that the committee had done everything it
could and that a summit between President Talabani, KRG
President Barzani, Vice Presidents Hashimi and Abdel Mehdi
and Prime Minister Maliki was really necessary. At the
conclusion of the working lunch, Massoum added that he would
be leaving for Kurdistan within 48 hours, with plans to
return to Baghdad in two weeks "only if there was work to be
done."

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Hydrocarbons Law
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8. (C) Deputy Secretary Negroponte said agreement on a
hydrocarbons law, and in particular its revenue-sharing
provision, was important because it demonstrated that the
different branches of the GOI could reach across sectarian
lines and agree on issues of national interest. President
Talabani countered that the Council of Ministers had agreed
on the content of the revenue-sharing provisions, but had not
yet sent the bill to the CoR. When the Deputy Secretary
emphasized the need to pass this law quickly, Talabani
responded that he thought the legislation could pass as soon
as late June -- in advance of the July deadline for the
preliminary benchmark reports to Congress.

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Article 140
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9. (C) President Talabani said a referendum on the status of
Kirkuk in the time-frame dictated by the constitution is
impossible because constitutionally-mandated "normalization"
(the compensated, voluntary resettlement of people introduced
into Kirkuk and the disputed territories by the former
regime) had not proceeded on schedule. Talabani concluded
that because this condition had not been met, the referendum
schedule would automatically extend past the December 31,
2007 deadline without amendment to the constitution or other
action by the GOI. To Ambassador Crocker's concerns about
Kurdish Regional Government President Masud Barzani's
reaction to a delay, Talabani, a one-time rival of the
Barzani clan, replied "what can he do?"

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MASHADANI--DEJA VU ALL OVER AGAIN
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10. (C) President Talabani said former CoR Speaker Mashadani
had been "fired" and that the Tawafiiq (Sunni) coalition had
been offered the opportunity to present another candidate.
Talabani cited several names including Adnan al-Duleimi and
Osama al-Tikriti, but emphasized that any nominee would
require CoR approval. Massoum added that Mashadani was
claiming his removal was illegal. S/I Satterfield noted
these were the same names mentioned the previous year during
the formation of the government. Talabani said he did not
think Duleimi was interested in serving as CoR speaker.


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ADMINISTRATIVE ISSUES--WHO GETS THE PALACE?
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11. (C) President Talabani asked Deputy Secretary Negroponte
when the Embassy would "give (the GOI) the Palace".
Ambassador Crocker said that construction on the new embassy
complex was "going well." He added the USG was conducting
both a civilian and military surge and that the number of
Americans arriving in Baghdad would continue to grow.
Crocker concluded that under these circumstances, the USG
would probably keep the palace for some time. Talabani said
he welcomed both surges and that the GOI had recently

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completed construction of a new presidency complex in the
Karada district directly outside the International Zone (IZ).
Talabani said he thought Iraqi security forces were now
capable of securing this area and because it is one of
Baghdad's most important commercial and recreational hubs, he
would like to see it linked to the IZ. Echoing some of his
comments on the current security situation, Talabani observed
US military authorities have been slow responding to his
requests. Without providing a timeline, Talabani added he
expected all ministers, ministries and the CoR to move out of
the IZ, saying they could provide their own security and that
presence of their security forces could help secure the
surrounding area.


12. (U) This reporting message has been cleared by the Deputy
Secretary's Staff.

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CROCKER