Vast oil and gas reserves help to warm relations with Libya  

I've occasionally wondered how much oil and Libya has (see here and here) - The Times has an article considering how much oil remains undiscovered under the Saharan sands - Vast oil and gas reserves help to warm relations with Libya

At 42 billion barrels, Libya has the largest proven oil reserves of any African country — equal to about 3 per cent of the global total. Its gas reserves are some 1.5 trillion cubic metres, the fourth-largest in Africa.

But Libya remains relatively unexplored, and the potential for fresh discoveries means that the true total could be far higher. That is why Libya’s return to the international fold has triggered a scramble for drilling rights among international oil companies.

Three of Britain’s biggest — BP, Royal Dutch Shell and BG — have already signed preliminary deals to provide cash and expertise to develop Libya’s investment-starved oil and gas industry. Shell signed in 2004, only months after Libya publicly abandoned plans to develop weapons of mass destruction, and the UN Security Council voted unanimously to lift sanctions.

BP’s much bigger deal, worth an estimated $900 million, was announced in 2007 during a visit by Tony Blair, then Prime Minister, to Tripoli. The company, which withdrew from Libya in 1974 when the country nationalised its oil industry, will explore 54,000sq km — at the onshore Ghadames and offshore Sirte basins.

British companies are competing against a host of rivals including Total, of France, the American ConocoPhillips, China National Petroleum Corp and Gazprom, the Russian state-controlled producer.

The British Government also has a strong vested interest in the programme. With North Sea gas running out fast, it hopes that Libya could become an alternative to Russia as a source of supply. By 2015, Britain could be importing as much as 80 per cent of its gas needs, up from 40 per cent now.

Exploration work in Libya in the 1960s identified at least ten fields each with more than a billion barrels of oil. Modern techniques could uncover more, and vast areas of the Libyan Sahara remain unexplored. Exploration licences cover only one third of the country. A spokesman for BP said that — if its exploration programmes offshore and in the country’s west are successful — it could invest $20 billion or more over the next 20 years building refineries, pipelines, petrochemical and liquefied natural gas plants to allow exports to the UK and elsewhere.