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Gold/Mining/Energy : Lundin Oil (LOILY, LOILB Sweden) -- Ignore unavailable to you. Want to Upgrade?

To: Tomas who wrote (1622)	5/3/2000 11:58:00 PM
From: Tomas	Read Replies (1) \| Respond to of 2742

Libya: ANALYSIS - Gaddafi reaps Lockerbie premium By Paul Taylor, Diplomatic Editor LONDON, May 2 (Reuters) - While two of his countrymen go on trial in a foreign court for allegedly blowing up an American airliner, Libyan leader Muammar Gaddafi is reaping political and economic dividends for delivering them to their fate. Long a political pariah and an economic backwater, Libya is now the international oil industry's hottest business prospect, according to a survey by British consultants Robertson. ``Political developments coupled with world class prospectivity propels Libya from a modest 20th position in 1998 to the number one country for new exploration, development and production ventures in 2000,'' their report said. The handover a year ago of Abdel Basset al-Megrahi and Al-Amin Khalifa Fahima to face charges over the 1988 mid-air bombing of a Pan Am jumbo jet over Lockerbie, Scotland, has unblocked a flood of commercial and political contacts. European businessmen are beating a path to Gaddafi's door, European Union leaders are lining up to shake the ageing Third World firebrand's hand, and U.S. business is chafing to have national sanctions lifted to avoid missing out in the race. ``Libya is the cheapest and most attractive oil province outside the Gulf. But the potential at the moment is far greater than the reality,'' said George Joffe, an expert on North Africa. Italy's ENI is investing billions of dollars in oil and gas projects and extending pipeline links with Europe. Other European oil companies such as France's Totalfina/Elf and Britain's Lasmo (quote from Yahoo! UK & Ireland: LSMR.L) are also looking to expand their operations there. But non-oil companies eager to win contracts complain of a maze of bureaucracy, the absence of investment protection and taxation laws, and the lack of Libyan private sector partners. ``Libya has no private sector worth speaking of. Everything remains to be done there. You really are starting from scratch,'' said a British businesssman who visited Tripoli last year. POLITICAL REHABILITATION Libya's political rehabilitation was highlighted last month when European Commission President Romano Prodi, French President Jacques Chirac, German Chancellor Gerhard Schroeder and then Italian Prime Minister Massimo D'Alema courted Gaddafi in private meetings at an Africa-Europe summit in Cairo. It seemed to matter little that the desert strongman delivered a vintage anti-imperialist tirade behind closed doors at the conference, denouncing Western calls for democracy. The meeting was the message. While Europeans wooed the quirky colonel, the United States sent a consular mission to Tripoli for the first time in almost two decades to determine whether it was safe for U.S. citizens to return to Libya. Western diplomats said the State Department favoured renewing business ties, starting by allowing American executives to visit the country, but Congress and other branches of the government were much less enthusiastic. One reason is that five men are still on trial in Berlin for murder and related charges over the bombing of a discotheque in 1986 in which two U.S. soldiers and a Turkish woman were killed. The attack prompted the United States to launch reprisal bombings on Tripoli and the coastal city of Benghazi. U.S. oil companies have acreage reserved in Libya but are not allowed to exploit it under unilateral sanctions. A controversial Iran-Libya Sanctions Act enacted in 1996 threatened penalties on any U.S. or foreign oil company that invests more than $20 million in the energy sector. NEED FOR INFRASTRUCTURE Intelligence sources say Libya has clearly ``got out of the terrorism business'' in Western eyes. Exiled opponents are no longer assassinated as ``stray dogs''. And Radical Palestinian groups which used to shelter under Gaddafi's wing, including the Abu Nidal organisation and the Popular Front for the Liberation of Palestine-General Command, are no longer welcome in Tripoli. ``There are no active remnants of any kind,'' a Western intelligence source said. Analysts say Gaddafi has largely given up on his fellow Arabs, whom he sees as spinelessly cutting deals with Israel, and has turned instead to Africa as a stage on which he can wield influence and play a larger role at a low cost. With the suspension last year of United Nations sanctions imposed in 1992 to force Tripoli to hand over the Lockerbie suspects, few barriers remain to investment and economic development -- other than the way Libya runs its economy. The country has no foreign debt and with oil at almost $25 dollars a barrel, it has plenty of revenue to spend on renewing its run-down infrastructure. Key projects in a five-year plan for 2001-5 include reviving a coastal railway line and refurbishing ports, roads and airports. There are also tourism and petrochemicals projects. Overcoming its 1970s-era statism is now the main challenge. ``In Libya, it's not like you're going to be able to do business the moment you arrive. But the Libyans realise they need to review their legislation and administrative procedures,'' said Sir Jeremy Hanley, a former British minister who led a UK trade delegation to Tripoli last year. biz.yahoo.com