Libya, BP, & LACMA
The regime of Muammar Gaddafi is fighting to crush a popular uprising that has taken control over much of Libya; it appears the Gaddafi government rules only in the capital of Tripoli.
As of this writing it is alleged that some 1,000 Libyans have been killed by Gaddafi’s soldiers who have used tanks, aircraft, and mercenary troops in their attempt to quash the rebellion.
But this article is not about the violence now sweeping the North African country, nor is it about the reign of Gaddafi, rather, it is about those who have helped sustain him. As world leaders and the international press rush to condemn Gaddafi, few mention the support his government has received from Western oil companies since 2004, when the U.S. and the United Kingdom lifted commercial sanctions against Libya. One oil giant that invested heavily in Gaddafi’s Libya was BP (British Petroleum).
In May of 2007, BP signed an agreement with Libya worth $900 million. The deal was signed in Sirt, Libya, by BP’s then chief executive Tony Hayward and the chairman of the National Oil Company of Libya, Shokri Ghanem. The Prime Minister of the United Kingdom at the time, Tony Blair, attended the signing. The official BP web site published a report detailing the agreement, even publishing a special online edition with the unintended prescient title of “Libya Rising.” A jubilant Tony Haywood would utter the following at the signing, words that should haunt BP until the end of time:
“We are delighted to be working with the National Oil Company of Libya to develop their natural resources for domestic and international markets. Our agreement is the start of an enduring, long-term and mutually beneficial partnership with Libya. With its potentially large resources of gas, favourable geographic location and improving investment climate, Libya has an enormous opportunity to be a source of cleaner energy for the world. This is a welcome return to the country for BP after more than 30 years and represents a significant opportunity for both BP and Libya to deliver our long term growth aspirations. It is BP’s single biggest exploration commitment. The agreement reached today is a great success for Libya, the NOC and also for BP.”
The 2007 deal allows BP to explore for oil and natural gas, offshore as well as onshore, giving the company access to three of Libya’s most promising but unexplored tracts – one area alone is the size of Kuwait. According to the agreement, BP will invest a minimum of $2 billion in Libya in the coming years, with expectations of boosting the nation’s oil production from the current 1.8 million barrels a day, to 3.5 million barrels a day by 2020.
As part of its pact with the Gaddafi regime, BP is preparing to sink an oil well in the Gulf of Sidra, around 125 miles from the coastal city of Benghazi. Despite BP’s liability for the Gulf of Mexico’s Deepwater Horizon oil rig disaster – the biggest environmental accident in world history – BP is slated to begin drilling in the Gulf of Sidra by June 2011. The undersea well will be drilled into the seabed at a depth of 1700 meters, making the Sidra well 200 meters deeper than the blown-out Gulf of Mexico well. It was the depth of the Deepwater Horizon well that made it next to impossible to repair or close, leading to hundreds of millions of gallons of crude gushing into the ocean. One can only imagine the environmental repercussions to the Mediterranean Sea if a comparable accident where to take place at BP’s Gulf of Sidra well.
BP plans to build at least five deep water drilling platforms in the Gulf of Sidra. In August of 2010, Italy’s environment minister, Stefania Prestigiacomo, expressed opposition to BP’s drilling in the Mediterranean, saying “A moratorium could be a right approach for potentially dangerous drilling.” The chairman of the Italian Senate’s environment commission, Antonio D’Alli, said he was “very worried” about BP’s plans. Mr. D’Alì said, “The problem is not BP or Libya. The sea has no boundaries and when accidents happen, in national or international waters, effects are felt in the whole Mediterranean. Considering it is already one of the most oil-polluted seas in the world, the impact of a major spill could be irreversible.”
Archaeologists and historians are fearful of what might happen to Libya’s archaeological treasures if a major accident takes place at the Sidra well. Innumerable ships have sunk in the Gulf of Sidra over millennia, and the shipwrecks would suffer incalculable damage in the event of a spill. The ancient city sites that dot the coastline of the Gulf would also be devastated by such a spill; the city of Apollonia being a prime example. Founded in the 7th century by Greeks, Apollonia became a major Roman city, and its ruins are some of the most well-preserved examples of Roman architecture to be found anywhere in the world. Most of the city has not been excavated, and the site extends right into the ocean, with the larger part of it laying beneath the sea as a result of an earthquake in 365 AD. In the event of a spill, crude oil would accumulate on the seafloor, covering ancient artifacts and underwater city ruins. Oily waves washing-up onshore would seep into the porous stone and be impossible to clean off.
BP is not the only foreign oil company in Libya; U.S. corporations like Exxon Mobil, Occidental Petroleum, Conoco Phillips, Marathon Oil, Hess Corp., and Halliburton all run profitable operations there. European nations are also well represented by Eni SpA (Italy: the largest foreign producer), Total S.A. (France: one of the six largest oil companies in the world), OMV AG (Austria), Repsol YPF SA (Spain’s largest oil company), Royal Dutch Shell (Netherlands), Statoil (Netherlands), BG Group (U.K.), Wintershall (Germany). China’s largest oil producer, CNPC, also drill for oil in Libya. Most if not all foreign companies are shutting down their Libyan operations for the moment. The chief executive for Eni said that his company will cut production “because of difficulty loading the tankers to export the oil,” inconvenient difficulties like Gaddafi’s army mowing down the Libyan people with machine gun fire.
The plans BP had to exploit Libyan oil have of course been interrupted by the Libyan people’s revolution, part of the wave of pro-democracy movements sweeping across the Arab world.
BP made the decision to “suspend” oil exploration in Libya on Feb. 21., and company spokesman David Nicholas said that all non-essential staff would be evacuated from the Libyan desert. The company has around 140 staff in Libya, most of which are Libyans. BP’s 40 expatriate personnel have been evacuated.
BP chief executive Bob Dudley would only say that “We have some people there. Dependents have left the country but we remain committed to doing business there.” There were no statements concerning the deplorable violence engulfing the nation, nor comments regarding the safety and welfare of the Libyan people, just an affirmation of wanting to conduct “business”.
I have been writing about the relationship the Los Angeles County Museum of Art (LACMA) maintains with BP since March 14, 2007, when it was first announced the museum accepted $25 million dollars from the multinational oil company. It would only be two months later that BP would arrange its May 2007 deal with Muammar Gaddafi. LACMA used BP’s millions to renovate and expand its campus, and the museum constructed a new entry gate and pavilion it christened, the “BP Grand Entrance.”
At the time LACMA’s Director Michael Goven billed BP as a “green” company, saying: “What was convincing to me was their commitment to sustainable energy.” One does not need to imagine what the Gaddafi regime did with the initial $900 million BP bestowed upon it, or if by chance it survives, what it would do with the billions BP has agreed to invest in Libya. As far as having a “commitment to sustainable energy,” just think of BP’s projected goal of raising Libyan crude output to 3.5 million barrels a day by 2020.
Tony Hayward, the bungling multi-millionaire former CEO of BP, has so far been remembered for complaining about the disruption the 2010 Gulf of Mexico oil disaster had on his personal life, saying at the time, “I would like my life back.” With Colonel Gaddafi presently drowning Libya in blood, Haywood and BP should instead be remembered for cutting a major oil and gas deal with Gaddafi – and gloating about it.
