Thursday 24 November 2011

Libya seeks UK firms to develop oil sector and construction industry

I am please to announce that the Guardian Newspaper agreed to my requests in which I altered them about the incorrect assumption of me allowing "alcohol" in Libya. The newspaper sent an apology and amended the article as follows

Libya began touting itself as the next Dubai to UK investors, as the country's government said it would reward its "friends" when it begins selling off lucrative oil contracts.

Representatives of the country's National Transitional Council called City executives to a central London hotel to drum up British interest in the "massive opportunities" on offer in Libya.

Oil companies, and their lawyers, have kept a close eye on Libya's vast reserves, which accounted for more than 95% of the country's exports before the popular uprising against former dictator Muammar Gaddafi.

Nuri Berruien, head of Libya's National Oil Company, said that the country's government would "favour our friends" when awarding new contracts to its 46bn barrels of untapped oil reserves – the largest in Africa and eighth largest in the world. But he said it was unlikely that any new contracts would be granted before an elected government takes over from the NTC.

The transitional government has said existing contracts with oil firms, including BP, Shell, Eni and Total, will be honoured unless it finds evidence of corruption in the awarding of the contracts under the former regime.

Berruien said Libya's daily oil production, which stands at 600,000 barrels, is expected to hit 800,000 by the end of the year and return to pre-war levels of 1.6m by the end of 2012. Virtually all of Libya's oil is exported.

Representatives of international oil groups were told the best way to exploit Libya's oil wealth is to go into partnership with a local operator. Under the country's laws foreign oil firms may own up to 65% in joint ventures with local operators.

Heritage Oil, the FTSE 250 oil exploration firm run by Tory donor and former mercenary Tony Buckingham, became the first new entrant into the Libyan oil market since the fall of Gaddaffi when it bought a 51% stake in Sahara Oil Services Holdings for $19m (£11.9m) last month.

This week the Guardian revealed that Buckingham appeared to have sought the assistance of would-be Conservative MP Christian Sweeting in getting a foothold in the country.

Tarek Alwan, managing director of SOC Libya, a consultancy set up to help international businesses enter the Libyan market, said the north African country offered "vast opportunities" not just oil and gas, but also construction.

• This article was amended on 24 November 2011 to remove a quote which was misattributed to Tarek Alwan.

Wednesday 23 November 2011

Libya open for business but obstacles ahead


When Omar's boss called him from abroad to tell him he wanted to come back Tripoli to restart his manufacturing business, the Libyan employee joked to his foreign manager the visit would just be personal.

"I said 'Boss, you would be spending all your time with me, there is no one to do business with'," Omar, who would only give his first name, said. "I told him to wait."

Omar's boss, like many other international businessmen, is keen to return to Libya to get his venture back up and running after eight months of civil war ousted Muammar Gaddafi from 42 years in power.

But in a nation lacking security and bristling with weapons, their re-entry may not be swift or easy.

Within days, Prime Minister Abdurrahim El-Keib will name a new government that will have the tough task of asserting the National Transitional Council's (NTC) control of a fractured country, reviving the economy and introducing democracy.

It will have to build institutions from scratch, sustain the revival of Libya's oil industry and disarm militias.

"It's a rather dark picture that is to be painted right now. Offices have been looted in the conflict, it's not clear who is in charge, who you need to speak with," said one European businessman who returned to Libya a few weeks ago after being evacuated during the conflict.

"I have tried to go find my old clients to get money that was owed, but how can they pay me back? Services aren't back up and running, banks are still limited in their operations."

Post-war Libya is also grappling with a banknote shortage.

The businessman had visited his old office and home, but like many other foreigners in Libya now, preferred to stay in the secure compound of one of Tripoli's plush hotels.

"There is no police, no order right now," he said. "But I am hopeful things will get better."

Bringing unruly and heavily armed militias under government control is a daunting challenge. Many foreign workers are adopting a wait-and-see approach until stability is restored.

"The economy is suffering from a lack of funds and the spread of weapons is one of the reasons for this with regard to tourism and foreign companies," Tripoli Islamist militia leader Abdel Hakim Belhadj told a seminar at Tripoli university.

At Tripoli Towers, one of the capital's main office blocks, the bulk of businesses operating are Libyan. The few foreign airlines that fly into Libya have re-opened their doors, but corridors are quiet.

At a nearby block of offices, the lack of foreigners is also evident. Outside a Libyan man carried his shopping in one hand and an AK-47 assault rifle in the other.

"This place used to be buzzing," said a Western security adviser. "Now the main thing you notice is the lack of expats."

Foreign faces can be seen in hotel lobbies but their visits are fleeting for now. "There seem to be more security guys here than actual businessmen," a second security contractor joked.

Neither contractor expected a significant return of foreigners before the new year at the earliest. "Moving their families back will take even longer," one said.

Jack Mullan, director of risk consultancy Morelia Investments, said clashes between rival militias had deterred foreign businesses from rushing back to Libya.

Last week, heavy fighting between local armed groups killed several people on the outskirts of Tripoli.

British airline bmi has cancelled plans to resume direct flights from London to Tripoli this month and said on Friday there was no firm date for restarting the service.

"The poor security environment would have to improve before investors return. The current militia in-fighting would have to be resolved to soothe many investors' concerns. Otherwise many Fortune 500 companies will not return to Libya," said Mullan, who also cited an unpredictable regulatory environment.

"HUGE OPPORTUNITIES"

Yet with the civil war over and a government in the making, foreign executives are weighing the opportunities against the risks in an oil and gas-producing nation with the resources to pay for urgent reconstruction and healthcare needs.

Several Western nations have sent trade delegations, no big winners have emerged yet in the race for contracts.

"The government has to be named, there needs to be structure before business can be done," a diplomatic source said.

Tarek Alwan, managing director of London-based consulting firm SOC Libya, said he had been approached by numerous companies seeking guidance on how to enter the Libyan market.

"We have noticed a greater degree of demand to enter the Libyan market. There are huge opportunities in Libya in construction, infrastructure, IT, tourism," he said.

"My advice is that it is still a bit too early to do business in Libya. My advice is that they should be doing their homework and preparations."

One company that was quick to make a move was Britain's Heritage Oil which spent $19.5 million (12.3 million pounds) buying a controlling stake in Benghazi-based Sahara Oil Services in October, in a deal that was denied by Libya's National Oil Company.

NTC officials have said existing contracts with foreign firms would be honoured, although those found to have been awarded corruptly might be reviewed.

But major new concessions are unlikely to be awarded until the incoming transitional government has given way to an elected administration, scheduled to take place in eight months.

In the meantime, restocking offices, finding new staff to replace foreigners who fled, and in some cases getting striking workers back to work is key. Workers at Libyan oil producer Waha Oil, which pumped around a quarter of pre-war output, downed tools for weeks until their demands for a new chairman were met.

"Let's try to get things started," Libyan businessman Amr Azzabi said, "And then make changes as we go along."

By Marie-Louise Gumuchian from Reuters

(Additional reporting by Oliver Holmes and Alastair Macdonald; Editing by Alistair Lyon)

Wednesday 16 November 2011

Libya –The Future 2 conference (Monday 14 Nov 2011 – London)






The event was a part of the dialogue started in September at the initial ‘Libya –The Future’ conference and will focus on how British industry & businesses can help Libya rebuild their country.

The first keynote speaker was Edward Oakden, managing director of UK Trade & Investment (UKTI) Sectors Group, who recently returned from a trade mission to Libya. He outlined how UKTI can assist and support UK businesses entering or re-entering the Libyan market.

The second keynote speaker was Tarek Alwan, Managing Director of SOC Libya Ltd, Who also was in Libya recently and planning to return soon, he gave a presentation about Oil and Gas

Robin Lamb, director general of the Libyan British Business Council (LBBC), gave details of the LBBC trade mission to Libya and the work of LBBC to promote British Businesses into Libya.

There was also be a video conference call to Tripoli to Sami Zaptia MD of ‘Know Libya’ (an Anglo-Libyan company) who was talking directly on progress of getting back to business and ways to facilitate & establish UK business entry and establish local partnerships.
The speaker panel Identified the business sectors who would need to be involved in the rebuilding of Libya in the immediate and medium term future including infrastructure, construction, communications, medical – hospitals, oil refineries, transport services, finance & business systems.

Libya – The Future 2 discussed areas for medium to long term partnership for example further oil exploration, tourism development, retail & service sectors.

Libya – The Future 2 Conference was the second in a series of events being organised by Foley Associates to track Libyan progress and focus on industry sectors. The third event in the series will be a two-day conference, workshop & exhibition showcasing international companies takes place 13-14 February 2012.

More info at www.libya-conference.co.uk
Contact Stephen Foley on 07966 200895 or 01706 378827 info@libya-conference.co.uk


BBC Radio Interview

This is the interview which BBC Radio "World Today" conducted with me regarding business opportunities in new Libya