Libya says U.S. firm Marathon to stay, eyes Algeria gas deal

Sat Oct 26, 2013 3:57pm EDT
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By Ulf Laessing

TRIPOLI (Reuters) - U.S. firm Marathon Oil (MRO.N: Quote) will continue operating in Libya after giving up plans to sell its stake in Waha Oil Company, Oil Minister Abdelbari Arusi said on Saturday.

Two years of turmoil after the overthrow of leader Muammar Gaddafi, as well as tough contract terms, have prompted oil companies to reassess their role in the North African country, but the government has been keen to keep them.

Sources told Reuters this week that Marathon was blocked from selling its stake in Waha by the government which has first refusal on such a deal. A source said the state-owned National Oil Corp (NOC) was likely to offer Marathon below market value for the stake.

"They are staying here," Arusi told reporters. "They told us they will continue with us."

Marathon was not immediately available for comment.

Arusi also told reporters that Libya was considering buying gas from neighboring Algeria as it faces power cuts during peak demand, and said South Africa wanted to buy oil from Libya.

"We discussed that (South Africa) will buy some oil from Libya based on world market prices," Arushi said after meeting Ohm Collins Shabane, minister in the South African presidency.

Both sides were also discussing working together on gas production in the Brega area, a coastal zone where Libya's state industry is producing gas.   Continued...

Libya's Oil Minister Abdelbari al-Arusi speaks during a joint news conference with Prime Minister Ali Zeidan at the Prime Minister's Office in Tripoli July 31, 2013. REUTERS/Ismail Zitouny