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For those who are deluded: “Partnership with Russia should bring cash to Libya”

Russia’s Gazprom Neft company, in a joint venture with Italian Eni, has resumed operations in Libya, Russia`s special presidential envoy to Africa Mikhail Margelov said Monday. He believes there are no political reasons for revising contracts between Tripoli and Moscow.

Gazprom Neft has become the second Russian company which has returned to Libya in the past two weeks. Gazprom, which cooperates with Germany`s oil and gas giant Wintershall, was the first to come back. Gazprom and Wintershall have equal shares in several projects in south-eastern Tripoli. This partnership is earning Libya 20,000 barrels of oil daily, with the production volume likely to increase in the near future.

Gazprom Neft and Eni faced a far more challenging task trying to resume oil production in the region. The infrastructure of their Elephant field was destroyed during the war, and a deal to hand over a part of Italian assets to Russia was frozen. In late September, Eni announced that it had resumed oil production at 15 wells 300 km south of Benghazi. At the beginning of this week Eni confirmed its interest in a partnership with Gazprom Neft. Mr. Sergei Pikin, head of the Energy Development Foundation, thinks that the new Libyan authorities will welcome the return of the companies Tripoli had cooperated with in the past: “The new Libyan government needs to start selling oil as soon as possible to earn some money for the national budget. Quick money – this is what they need now.”

Meanwhile, the former Russian ambassador to Libya and an expert at the Russian Institute of Oriental Studies, Alexei Podtserob, predicts a tough competition for new contracts with Libya.

“A lot of companies are trying to win a place on the Libyan market. Now that oil production in Libya is no longer controlled by the state, the number of such companies will become even bigger. After all, control over resources was among the key aims of the NATO-led invasion.”

The newly-elected Libyan Prime Minister Abdel Rahim al-Keib confirmed Tuesday that his Cabinet would observe all the previously signed agreements with Moscow. In view of this, Russia`s presidential envoy to Africa Mikhail Margelov stressed the importance of resuming cooperation on the projects related to the development of the infrastructure, primarily those initiated by the Russian Railways state-owned company. The issue will be on the agenda of Mr. Margelov`s meeting with the new Libyan Prime Minister scheduled for the middle of this month.

Fedoruk Vladimir  –  TheVoice of Russia – Nov 2, 2011

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