UK oil giant BP PLC is to sign a US$900-million oil and gas exploration deal in Libya with the North African country’s state-owned National Oil Corp, said Shokri Ghanem, head of the Libyan National Oil Corp. (NOC).
The deal, once signed, will mark BP’s return to Libya after more than three decades. BP left in 1974 when Libyan leader Muammer Gadaffi seized the assets of foreign oil companies.
Ghanem made the announcement ahead of a visit to the oil-rich nation by British Prime Minister Tony Blair.
Blair flies out of London today and will visit Tripoli for talks with Gadaffi and then will travel to Sierra Leone and South Africa. He last visited Libya in March 2004 after Gadaffi shocked the western world by announcing that he was abandoning Libya’s weapons of mass destruction.
A BP spokesman in London declined to confirm Ghanem’s statement.
"We are still in discussions with the NOC. We’re looking forward to reaching an agreement but nothing has been signed yet," he said, adding BP officials, led by chief executive Tony Hayward, will be in Tripoli in the next few days.
BP signed a memorandum of understanding with NOC in 2005 to explore potential opportunities in Libya’s oil and gas industry. It was producing oil at Libya’s Sirt Basin until its withdrawal from the country in 1974.
Early last year, press reports claimed BP and the NOC were discussing a multi-billion dollar natural gas exploration and development project that could supply the North American or European markets.
BP rivals BG Group PLC and Royal Dutch Shell PLC secured upstream projects in Libya as early as 2005.