The Scramble for Access to Libya's Oil Wealth Begins
By CLIFFORD KRAUSS and ELISABETTA POVOLEDO
Published: August 22, 2011
Bob Strong/Reuters
A truck carrying rebel fighters driving toward the oil refinery in Zawiyah, Libya, last week.
Even before Libyan rebels could take full control of Tripoli, Foreign Minister Franco Frattini of Italy said on state television Monday that the Italian oil company
Eni "will have a No. 1 role in the future" in the North African country.
Mr. Frattini even reported that Eni technicians were already on their way to eastern Libya to restart production. But Eni quickly denied that it had sent any personnel to the still-unsettled region, which is Italy's largest source of imported oil.
The awkward exchange suggested that the scramble to secure access to Libya's oil wealth is already on. Libyan production has been largely shut down during the long conflict between rebel forces and troops loyal to Libya's leader, Col. Muammar el-Qaddafi.
Eni, as well as BP of Britain, Total of France and OMV of Austria, were all big producers before the fighting and stand to gain the most once the conflict ends. American companies like Hess, ConocoPhillips and Marathon also made deals with the Qaddafi regime, although the United States relies on Libya for less than 1 percent of its imports.
But it's unclear whether a rebel government would honor the contracts struck by the Qaddafi regime.
Even before taking power,
the rebels were suggesting that they would remember their friends and foes, and negotiate deals accordingly.
"We don't have a problem with Western countries like Italians, French and U.K. companies," Abdeljalil Mayouf, a spokesman for the Libyan rebel oil company Agoco, was quoted as saying by Reuters.
"But we may have some political issues with Russia, China and Brazil."
Russia, China and Brazil did not back strong sanctions on the Qaddafi regime, and they generally supported a negotiated settlement to the fighting. All three countries have large oil companies that are seeking deals in Africa for oil reserves.
Before fighting broke out in February, Libya exported 1.3 million barrels of oil a day. While that is less than 2 percent of world supplies, only Nigeria,
Algeria and a few other countries can supply equivalent grades of sweet crude that many refineries around the world depend on.
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