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The following is the text of letter sent
on my personal letterhead. - Richard
Knight April 26, 2002 Luke R. Corbett Chairman and Chief
Executive Officer Kerr-McGee Corporation Kerr-McGee Center P.O. Box 25861 Oklahoma City, OK 73125 Dear Mr. Corbett I am deeply concerned about
Kerr-McGee’s activities in and off the coast of Western Sahara. I urge you to end all activity in Western
Sahara until the people have been able to exercise their right to
self-determination and that you correct errors of fact in your filings with
the Securities and Exchange Commission. The people of Western
Sahara have long been denied the right to self-determination. Neither the United Nations nor the United
States recognize Morocco’s claim to Western Sahara. The World Court has ruled that the people
of Western Sahara have the right to self-determination. They have not been able to recognize this
right because Morocco has refused at allow a referendum to take place and has
rejected the voter lists produced by the United Nations. The discovery of exploitable oil or gas
will only make Morocco more determined to block a free and fair referendum. As you know, the granting
of reconnaissance rights by Morocco in October 2001 to Kerr-McGee has been
the subject of debate, including a legal opinion by the United Nations. In February 2002 United Nations Legal Counsel
Hans Corell determined that Kerr-McGee’s contract,
and a similar one signed by TotalFinaElf, were
legal. But the opinion also stated: “If,
however, further exploration and exploitation activities were to proceed
without respect to the interests and wishes of the people of Western Sahara,
the contracts would be in violation of international legal principles dealing
with non-self-governing territories.” I am also concerned about
the material misstatement of fact on this topic on your Form 10-K. You list your activities as being off the
coast of Morocco, not of Western Sahara.
Further, Kerr-McGee must have known when it signed the agreement that
the territory concerned was in dispute and Morocco’s legal right to grant
reconnaissance, exploration and exploitation rights was in dispute. The subsequent UN opinion confirms that
Morocco does not have the legal right to grant exploration and exploitation
rights. If Kerr-McGee undertook such
activities it would be violating international law. Not knowing the block is in Western Sahara
and the legal obstacles to further exploration and exploitation, investor
might overvalue Kerr-McGee stock.
Investors should know the political and legal risks of operating in
Western Sahara. Kerr-McGee should withdraw
from Western Sahara until such time as the people of that territory have been
able to exercise their right to self-determination and a proper legal
authority exists to grant exploration and exploitation rights. Kerr-McGee should correct its Form 10-K. In subsequent filings Kerr-McGee should explain
the legal issues and limitations on future activities. Sincerely, Richard Knight This letter is part
of the web site richardknight.com |