Friday

9th Dec 2022

EU oil companies set to return to Libya

  • Libya oil and gas facilities. Frattini: 'It is clear that Eni will play a No. 1 role' (Photo: International Energy Agency)

EU oil firms are preparing to return to Libya amid good will generated by Nato support. The military alliance has also carried out "prudent planning" for a potential peacekeeping mission.

Italian foreign minister Franco Frattini on Monday (22 August) said energy company Eni has sent a delegation to meet rebel leaders in Benghazi after opposition forces entered Tripoli at the weekend, signalling the end of the Gaddafi regime.

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"I won't be revealing any secrets if I say that Eni technicians have already been called to Benghazi to reactivate plants ... The facilities were made by Italians and therefore it is clear that Eni will play a No. 1 role in the future," he told Rai TV.

Eni spokesman Cesaro Fabio declined to comment on the Benghazi trip. He told EUobserver that Eni's oil and gas licences in the country are valid until between 2042 and 2047, however. The firm's pre-war oil output in Libya was 270,000 barrels a day. It also operated the 10-billion-cubic-metre-a-year Greenstream gas pipeline.

Stefan Leunig, a spokesman for Germany's Wintershall, previously on 100,000 barrels a day, said: "Starting up production could be done within several weeks under standard technical conditions. This of course depends on the state of the export infrastructure as well as a stable security situation."

A spokeswoman for French firm Total said: "We are monitoring the situation closely to see when we can restart operations." A spokesman for Austria's OMV said it last had contact with rebel leaders in late June, but is also "monitoring the situation, and in particular the further, recent developments very closely."

BP told rebels in July it wants to restart drilling at its offshore facility in the Ghadames basin. "We are keen to resume those activities when conditions allow," BP spokesman Robert Wine said.

For their part, rebel authorities have promised an oil windfall for Nato members but said rebel-hostile countries such as Russia will lose out.

Abdeljalil Mayouf, information manager at the rebel-controlled Agoco oil company, told Reuters on Monday: "We don't have a problem with Western countries like the Italians, French and UK companies. But we may have some political issues with Russia, China and Brazil."

Aram Shegunts, the head of the Libya-Russia Business Council, commented: "Our companies won't be given the green light to work there ... Our companies will lose everything because Nato will prevent them from doing business in Libya."

Libya before the conflict erupted in February had an output of 1.6 million barrels a day of oil and 15 billion cubic metres a year of gas. It also has 47 billion barrels of proven oil reserves - the largest in Africa and the ninth largest in the world.

With the war entering its final stages, some opinion-makers have begun to call for Nato to send in ground troops.

"Some sort of international assistance, and most likely an international force, is likely to be needed for some time to restore and maintain order ... It is up to Nato, the European Union and the UN, working with the Libyan opposition, the African Union and the Arab League, to put together a response to the new Libyan reality," Richard Hass, the head of the Council on Foreign Relations think-tank in Washington and a former state department official, said in the FT on Monday.

The British government the same day said "We do not see any circumstances in which British troops would be deployed on the ground." But a Nato official told this website the alliance has drawn up plans for ground operations as part of routine procedure.

"Nato always does prudent planning. Nato stands ready to play a supporting role - but clearly the alliance will not be in the lead," he said.

The UN resolution which mandated Nato air strikes in Libya excluded "a foreign occupation force of any form on any part of Libyan territory."

The EU in April also drew up plans to send in soldiers to deliver humanitarian aid in a project entitled EUfor Libya, which fell by the wayside due to lack of UN support.

EU external relations spokesman Michael Mann said on Monday the bloc will send a "needs assessment" mission to Libya in the coming days. He added the EU intends to play a major role in constructing the new Libyan state.

"We have a number of funds available to set up civil society, help set up elections, for institution building and of course to help the recovery of the economy," he said.

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