Even if slowly.
Oil giants will be forced to tussle for contracts worth an estimated $16bn (£9.7bn) live on Iraqi television in a bizarre contest they fear could end up resembling a game show.
More than 30 energy companies, including BP, Shell and ExxonMobil may be forced to make last-minute alliances and reveal their offers in a tense round of bidding due to start early next week.
I\’m not so sure about doing it over hours rather than weeks but this is an attempt to rerun Brown\’s auction of the 3G spectrum (it was Brown, wasn\’t it? One of the few things the Treasury has got absolutely right over the years, anyway).
It\’s a great way to extract the maximum rent possible from natural resources. That rent, rightly, going to the national authorities, in just the same way that the rent from spectrum did. One way of describing it is the Georgist (or LVT) taxation of land rents, exapnding our definition of \”land\” a little here.
It\’ll make no difference to the price at which the companies sell their products, as profit maximisers we already assume they\’ll charge the maximum the market will bear. It just affects the revenue split between those pumping the oil and those who own the natural resource.
Great idea, at least in principle.