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Oil & Gas

Gazprom eyes Libyan gas, oil exports

July 11, 2008
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According to Reuters, Russian gas export monopoly Gazprom wants to buy any additional natural gas produced by Libya and some of the country''s oil, the North African country''s top oil official said recently.

Earlier, Gazprom said in a statement after its chief executive Alexei Miller met with Libyan leader Muammar Gaddafi that it hoped to buy "all future volumes" of gas, oil and liquefied natural gas available for export -- at market prices.

A cooperation agreement signed in 2006 between Gazprom, which supplies about a quarter of Europe''s gas, and Algeria prompted fears that Europe''s biggest two suppliers could work together in a similar way to the OPEC group of oil exporters.

State-run Gazprom''s latest bid to strengthen its grip on gas supplies around Europe comes as no surprise, David Cox, the president of Poyry Energy Consulting said.

Cox said it was unlikely that Libya would want to commit to selling its oil to one buyer and would most likely stick to selling its crude on the open market.


The world''s largest gas firm is also planning a joint refining venture with Libya''s National Oil Corporation (NOC), Gazprom said, and to build pipelines.

Gazprom also accepted Libya''s offer to build pipelines to Europe from the North African state, and said that a second, possible joint venture is also being looked at, focusing on gas and oil exploration and development.

Gazprom and Italian energy major Eni formed a strategic partnership in 2006, which allowed for energy asset swaps, including those Eni has in Libya.

Gazprom''s interest further cemented in April, when it signed a memorandum of cooperation with NOC in Tripoli. At the time it said it wanted to develop infrastructure including pipelines.

The North African country aims to become a major gas producer and expand production to 3 billion cubic feet per day (bcfd) by 2010, with a potential for 3.8 bcfd by 2015 versus 2.7 bcfd now.
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