Libya Tempts Executives With Big Oil Reserves
By JAD MOUAWAD
Published: January 2, 2005
RIPOLI, Libya - For the first time in a decade, a new oil territory is opening up. Reopening, that is.
American oil executives have recently been flocking to Libya, crowding the lobby of Tripoli's only luxury hotel and literally standing in line to meet local officials. The executives are bent on finding out whether this oil-rich North African country - long walled off from foreign investment because of its anti-American regime and ties to terrorist organizations - could become the next frontier for exploration.
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What the petroleum crowd is after lies hundreds of miles south of this enclave founded by Phoenician traders in the seventh century B.C., beneath a desert the size of Alaska that holds oil reserves estimated at over 36 billion barrels. That is enough to meet the daily imports of the United States for eight years.
And that may be just a starting point. At a time when oil around the world is harder to come by, Libya is dangling the rights to explore and develop new sources of petroleum. The country holds the largest oil reserves in Africa, but as a producer it trails Nigeria and Angola. And, as every Libyan official inevitably points out, only a quarter of the country has properly been explored for oil.
But that is where the problems start. Libya is a highly authoritarian state, fraught with tangled bureaucracy, rampant corruption and arbitrary enforcement of laws. Its regime is based on an elaborate fusion of socialism and Islam - dubbed the Third Universal Theory - that was Col. Muammar el-Qaddafi's answer to both capitalism and communism after he took control of the country in the late 1960's.
Such tribulations are nothing new for oil executives, many of whom have previously traveled to hostile and far-flung places around the globe in search of oil. They, along with other Americans, are certainly eager to do business here: the newly opened American liaison office said it receives more than 200 inquiries a week from interested companies.
In the next few months, several dozen oil companies will be watching as the Libyan government unveils the winners of new licenses that have attracted intense interest from major and independent producers.
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