Press Association
Tuesday May 29, 2007
Oil giant BP is to confirm its return to Libya’s oil and gas fields for the first time in more than 30 years.
A spokesman for prime minister Tony Blair, who is on a five-day visit to Africa, spoke of BP’s return at a briefing today.
BP has not operated in Libya since 1974, when the oil industry was nationalised.
The group confirmed today it had been in talks with the Libyan government over re-entering the country.
BP’s move back into Libya comes two years after rival Royal Dutch Shell announced its return to the country, timed to coincide with the Mr Blair’s 2004 visit.
Mr Blair became the first British leader in 60 years to visit Libya after Colonel Gaddafi abandoned efforts to produce weapons of mass destruction and handed over agents blamed for the bombing of an airliner over Lockerbie.
British companies have been keen to exploit business opportunities in Libya since sanctions were formally lifted in 2003, with the country attractive in particular to oil companies.
Libya produces high quality “sweet” crude oil at low costs and has plentiful reserves of both gas and oil.
The country’s first oil fields were discovered in the late 1950s and Libya became a major producer in the 1970s before nationalisation and introduction of United Nations and US sanctions.
State-owned company National Oil Corporation (NOC) now runs the country’s oil industry, but is now actively drawing up agreements with oil majors, such as Shell, which signed a long-term strategic partnership with NOC in March 2004.
BP was reported to be close to striking a similar deal in December 2004, with suggestions the company was looking to invest in projects including the construction of a gas liquefaction project, gas pipelines and gas field developments.
The group’s former chief executive Lord Browne – who recently brought forward his retirement from the group after being found to have lied to the high court about his private life – also reportedly flew to Libya in 2005 to hold talks with Colonel Gaddafi.
http://business.guardian.co.uk/story/0,,2090462,00.html
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