US Oil Firms Return to Libya

DALLAS, 31 December 2005 — Three US oil companies said on Thursday they will end a 19-year absence in Libya and pay $1.83 billion to resume oil production.

ConocoPhillips Co., Marathon Oil Corp. and Amerada Hess Corp. will share the production from a 350,000 barrel a day operation with the Libyan National Oil Corp.

The return to Libya reflects renewed US interests in the North African country after the US government last year lifted nearly two decades of economic sanctions.

In a February 2005 report, the US Department of Energy said Libya is ready to become a major oil exporter again, especially to Europe.

ConocoPhillips and Marathon, both of Houston, will have slightly more than 16 percent interest each; New York-based Hess will have about 8 percent; Libya’s NOC will have 59 percent.

The terms of the 25-year deal are similar to those when it was suspended in 1986, the companies said. Conoco and Marathon will pay $520 million each to the NOC; Amerada Hess will pay $260 million.