Perle Linked to Kurdish Oil Plan

Iraq War Advocate Denies Taking Part In a Consortium
By SUSAN SCHMIDT and GLENN R. SIMPSON, Wall Street Journal

Influential former Pentagon official Richard Perle has been exploring going into the oil business in Iraq and Kazakhstan, according to people with knowledge of the matter and documents outlining possible deals.

Mr. Perle, one of a group of security experts who began pushing the case for toppling Iraqi dictator Saddam Hussein about a decade ago, has been discussing a possible deal with officials of northern Iraq's Kurdistan regional government, including its Washington envoy, according to these people and the documents.

It would involve a tract called K18, near the Kurdish city of Erbil, according to documents describing the plan. A consortium founded by Turkish company AK Group International is seeking rights to drill there, the documents say. Potential backers include two Turkish companies as well as Kazakhstan, according to individuals involved.

AK's chief executive is Aydan Kodaloglu, who, like Mr. Perle, has been involved with the American Turkish Council, an advocacy group in Washington. She didn't respond to requests for comment. Phyllis Kaminsky, who identified herself as the U.S. contact for Ms. Kodaloglu, said she herself was aware of the drilling plan but referred questions about it to Mr. Perle.

"Richard would know the most," Ms. Kaminsky said. "He is involved, I know that."

People with knowledge of the discussions said they involve Alexander Mirtchev, a Washington consultant and adviser to the government of Kazakhstan, and an associate of his, Kaloyan Dimitrov. Mr. Perle has attended events promoting the interests of Kazakhstan, an oil-rich nation whose ruler, Nursultan Nazarbayev, is involved in a long-running U.S. investigation of 1990s-era oil-company bribery. Mr. Perle has publicly lauded President Nazarbayev as "visionary and wise," according to a publication distributed by the Kazakh embassy in Washington.

Mr. Perle said by email that Mr. Mirtchev is a friend of his who once spent a night at his vacation home in France. Mr. Perle said Mr. Mirtchev is "justly...proud of his influence on the liberalization of the Kazakh economy."

Asked about pursuing oil concessions, Mr. Perle said, "I am not involved in any consortium involving Mr. Mirtchev or Mr. Dimitrov, nor am I 'framing plans for a consortium'" involving either one. He declined to elaborate.

Brian Shaughnessy, a lawyer for Mr. Mirtchev, said his client "is not working on oil related projects in Kazakhstan or Kurdistan with Richard Perle, nor have they done any business deals of this nature." A lawyer for Mr. Dimitrov didn't respond to questions about oil discussions.

A spokesman for Qubat Talabani, the Kurdistan regional government's representative in the U.S., confirmed that the envoy had been approached by Mr. Perle. In a statement, Mr. Talabani said "one of my duties...is to seek out potential investors for our new, growing economy in Iraqi Kurdistan as well as respond...to all legitimate requests for investment information."

Kurdish authorities have been granting oil-drilling contracts even though Iraq's central government and the Bush administration want them to hold off until a national oil law is passed.

The K18 concession, which is estimated to hold 150 million or more barrels of oil, would potentially be operated by Houston-based Endeavour International, according to documents and people familiar with the discussions. A spokeswoman for Endeavour said, "At this point we wouldn't have anything definitely going on, and we wouldn't comment on anything that hadn't been publicly announced."

Mr. Perle also has explored obtaining an oil concession in Kazakhstan in tandem with a northern Iraq deal, according to people familiar with those discussions.

Mr. Perle, who was an assistant Defense secretary in the Reagan administration, is known for his strong support of Israel and hawkish views on arms control. In the early days of the Bush administration, he was one of the most influential proponents of U.S. military action to oust Iraq's President Hussein.

Mr. Perle was chairman of the Defense Policy Board, which advises the Pentagon, but resigned in March 2003 amid criticism of his role as an adviser to a telecom company that was seeking U.S. government approval for a sale to Asian investors. He is a scholar at the American Enterprise Institute think tank.

Write to Susan Schmidt at susan.schmidt@wsj.com and Glenn R. Simpson at glenn.simpson@wsj.com