Tag Archives: Libya

Oil and Water: The Spoils of the Libyan War

The real battle over Libya’s future has less to do with opposing political factions than with which foreign players will gain control of the country’s natural resources–oil, natural gas, and water. Europe’s leading oil firms are busy jockeying for position in the impending division of the spoils, while insiders watch for China to make its move.Overlooking it all is a growing US  network of drones which could well be the forerunner of a new,aggressive American military presence on the African continent.

A decision on Friday by the UN Security Council frees  the Libyan national oil company of restraints on its financial operations, which  opens up Libya’s ability to pay for reconstruction. That process ought to get a  further lift from Obama’s meeting on Tuesday with the interim government leader Mustafa Abdul Jalil and his decision to reopen the US embassy in Tripoli

Libya currently produces 2 percent of the world’s oil, but two  things make it a more formidable player in the world market than the numbers  would indicate. One is its location, a short trip across the Mediterranean from  Italy, France, and Spain, with ready access to European energy markets. The  other is the fact that Libya has substantial known reserves–the largest in  Africa, and ninth largest in the world–yet most of the country remains “underexplored” and unmapped, offering the possibility of  even greater supplies in the future.

To date, Italy has been the largest beneficiary of Libyan oil  supplies, for a number of reasons. The Italians invaded and colonized Libya in 1911, left it in tatters following the big tank battles of World War II, and in recent years has emerged as a major force in its oil economy and foreign policy. Before the revolt, Berlusconi enjoyed warm relations with Qadaffi. Italy and Libya worked hand in hand in an effort to slow the flow of immigrants from the Red Sea and northern Africa into Europe with the Italian coast guard intercepting boatloads crossing the Mediterranean through the Italian island of Lampedusa, which lies off the Libyan coast below Sicily. Italy also drew one third of its entire oil supply from this former colony.  ENI, the Italian oil giant, is the largest foreign oil company in Libya. Recently Russia’s Gazprom joined ENI in a joint venture to drill for oil under the desert.

The giant international oil companies are socked into Libya and they all have been vying for oil and gas throughout the fighting. According to a report in the Guardian, the London oil trading firm Vitol was in close touch with the rebels, arranging fuel supplies. The new interim government has said France, Britain, and Italy will get favorable treatment compared to China and Russia. Liberation, the French newspaper, reported that Sarkozy cut a deal with the rebels in which France would get 35 percent of the country’s oil in return for military assistance—on the face of it, a pretty wild claim.

ENI’s chief executive officer, Paolo Scaroni, told the Wall Street Journal  earlier this month that the new Libyan government insists it will honor existing contracts. The AP reported executives from Repsol, the Spanish oil firm, were in Benghazi discussing restoring existing operations. Total, the French firm, is preparing to re-enter as well.

Actually the key factor in this game could turn out to be not so much oil, but natural gas. Right now Russia has a near monopoly on gas going into Europe and at an exorbitant price, but its reliability in winter months is questioned. Libyan exports of gas through the Greenstream pipeline to Sicily, also run by ENI, have been increasing. Some industry commentators suggest that natural gas exports might dramatically expand so that Libya acts as a counterweight to the Russians. That, at least, seems to be how the Russians, who stayed well clear of the NATO air attacks, see the situation. According to the AP:

Dmitry Rogozin, Russia’s ambassador to NATO, described its former Cold War rival’s intervention in Libya as legitimate because it was aimed at protecting civilians, but he said Russia believes the underlying reason was access to Libyan oil.

“For Russia, NATO’s operation in Libya indicated that the major interests of the alliance now lay not in Europe’s East — where its adversaries the Warsaw Treaty Pact and the Soviet Union used to be — but in oil-rich lands of Northern Africa and the Middle East,” Rogozin said in an email.

It seems hard to believe existing oil arrangements—some 50 companies have been engaged in the Libyan oil business–will be seriously affected by Quadaffi’s exit, but the sleeper here is China, which already is ensconced in the Libyan economy, and according to Toronto’s Globe and Mail, offered Quadaffi armaments during the war. These included shoulder-held rockets similar to the U.S. Stinger. They were to be shipped through Algeria or South Africa.

Libya now is China’s eleventh largest source of imports. And before the revolt, 36,000 Chinese were working on 50 different projects within the country. China played both sides during the revolt. While it was peddling arms to Quadaffi, Ma Zhaouxu, spokesman for the Chinese Ministry of Foreign Affairs, issued a statement saying, “The Chinese side respects the choice of the Libyan people.
The Chinese side is willing to work with the international community to play a
positive role in the reconstruction process of Libya in the future.’’

Water presents an equally controversial subject in Libya. Quadaffi’s ambitious Great Man Made River, a 2,333 mile network of irrigation pipes drawing water from acquifers beneath the southern desert and turning the arid wastes into lush farmlands. It sounds like a project imported straight from the Colorado river whose diversion has transformed much of the US desert west into into green farmlands and pleasing suburban front lawns. And, in fact, it was Armand Hammer’s Occidental Petroleum that seems to have introduced earlier and smaller versions of this irrigation scheme.

There is one big hitch to this water project. The desert aquifers, as Sandra Postel of Worldwatch, points out in her book Last Oasis, were filled with water 30,000 years ago when there was considerably more rainfall than there is today. In examining this project, engineers now predict the desert aquifers will be sucked dry within 40-60 years. The water will all have been pumped up to the Mediterranean coast for agriculture.The original coastal water sources have been exhausted. So, by then the food and water purchased with oil money will be gone and the whole thing will go down in history as folly.

To defend against such an eventuality Quadaffi looked further afield to line up more water. He hit on Mali a poor country, which up to the present time, was made self sustainable by prudent use of shallow ground water wells. Fred Pearce in Environment 360, a Yale publication, describes the sorry story of what happened when Quadaffi fixed his gaze on Mali:

Libya’s wholesale move into Malian irrigation and agriculture is the result of a secret deal between Mali’s president, Amadou Toumani Toure, and Libya’s Colonel Gadaffi. Paid for by Gadaffi’s sovereign investment fund, the Libya Africa Portfolio Fund for Investment, the deal hands the land to a Libyan-controlled organization called Malibya for 50 years and gives the Libyans undisclosed rights to the region’s water. Why would the Mali president sign up to this?

Local campaigners say their government is in thrall — and hock — to Libya because it has become dependent on Libya for aid and investment. Many of its civil servants work in offices built by Libya, and international visitors stay at Libyan-built hotels. And, says Lamine Coulibaly, head of communications for the Mali small farmers’ union, CNOP, the government is so obsessed with getting investment for its agriculture that it cannot see when that investment will do more harm than good to its people.

The infrastructure for agribusiness is in place, and if Libya manages to siphon off water from sub-Saharan Africa into growing crops for Europe and likely the United States, it will be a major player in food as well as fossil fuel supplies. All this will provide the money for the new government, which may or may not provide some form of limited democratic rule.ilitary

There is another aspect to the future of Libya and that has to do with US military ambitions in Africa. These are driven by determination  to root out terrorrists;\ over the long term,they may well be intended to check China which sees Africa as a fuels bin and already has built up an  expansive economic network on the continent.The Washington Post’s report Wednesday morning of growing US drone operations in Africa suggests an expanded US military presence on the continent where heretofore it has been minimal.

New Expose of Big Oil’s Role in the Iraq War

   When it was  suggested the war in Iraq was about oil, Tony Blair,then the British prime minister, had this to say on February 6,2003

     “Let me just deal with the oil thing because… the oil conspiracy theory is honestly one of the most absurd when you analyse it. The fact is that, if the oil that Iraq has were our concern, I mean we could probably cut a deal with Saddam tomorrow in relation to the oil. It’s not the oil that is the issue, it is the weapons…”

  In fact, as I and numerous others, have reported on many occasions before,during and after the war, oil was a principal if not the principal reason, for going to war. The reason for thinking this comes from any reading of oil history in the Middle East. The  modern industry began in Mesopotamia (modern Iraq), which today probably boasts the largest reserves in the world. Current knowledge of oil and the war in large part comes from  the work of a  researcher in the UK named Greg Muttitt. Among other things, Muttitt has had close contacts with the Iraq oil workers union. Now Muttitt has written a book–released in Britain and India this week, called Fuel on the Fire–that makes crystal clear  the role of big oil. His research had turned up hundreds of pages of heretofore secret documents and is further backed up by interviews with executives of the international oil companies.

    This book ought to rekindle interest in the secret meetings held on Bush energy policy by Dick Cheney,and its revelations about the British fears of France,may well provide clues to underlying factors in today’s fighting in Libya.More about that later.

   Here is how the Independent reported the story on April 19:

 The papers, revealed here for the first time, raise new questions over Britain’s involvement in the war, which had divided Tony Blair’s cabinet and was voted through only after his claims that Saddam Hussein had weapons of mass destruction. ….The minutes of a series of meetings between ministers and senior oil executives are at odds with the public denials of self-interest from oil companies and Western governments at the time.

Five months before the March 2003 invasion, Baroness Symons, then the Trade Minister, told BP that the Government believed British energy firms should be given a share of Iraq’s enormous oil and gas reserves as a reward for Tony Blair’s military commitment to US plans for regime change.

The papers show that Lady Symons agreed to lobby the Bush administration on BP’s behalf because the oil giant feared it was being “locked out” of deals that Washington was quietly striking with US, French and Russian governments and their energy firms.

There is more:

Minutes of a meeting with BP, Shell and BG (formerly British Gas) on 31 October 2002 read: “Baroness Symons agreed that it would be difficult to justify British companies losing out in Iraq in that way if the UK had itself been a conspicuous supporter of the US government throughout the crisis.”

The minister then promised to “report back to the companies before Christmas” on her lobbying efforts.

The Foreign Office invited BP in on 6 November 2002 to talk about opportunities in Iraq “post regime change”. Its minutes state: “Iraq is the big oil prospect. BP is desperate to get in there and anxious that political deals should not deny them the opportunity.”

After another meeting, this one in October 2002, the Foreign Office’s Middle East director at the time, Edward Chaplin, noted: “Shell and BP could not afford not to have a stake in [Iraq] for the sake of their long-term future… We were determined to get a fair slice of the action for UK companies in a post-Saddam Iraq.”

BP was concerned that if Washington allowed TotalFinaElf’s existing contact with Saddam Hussein to stand after the invasion it would make the French conglomerate the world’s leading oil company. BP told the Government it was willing to take “big risks” to get a share of the Iraqi reserves, the second largest in the world.

 

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Gates on Libya: Then and Now

On his trip to Russia Robert Gates said that attempting to assassinate Gaddafi would not be a good idea, claiming “I think it’s important that we operate within the mandate of the UN Security Council resolution.’’–Aljazeera

 And “I don’t think we ought do anything to encourage partition or division of these countries,” Gates said. “I think that would be a real formula for instability.” –quoted in the National Journal.

“In 1985, sounding very much like one of today’s neoconservative hawks, the then head of intelligence analysis at the CIA drafted a plan for a joint U.S.-Egyptian military operation to invade Libya, overthrow Col. Muamar Ghaddafi, and “redraw the map of North Africa.” On the basis of this idea, CIA Director Casey, sometimes said to be the man who invented Gates, ordered up a list of Libyan targets and the National Security Council developed a plan to have Egypt attack Libya with U.S. air support and seize half the country. The Joint Chiefs drew up plans for a military operation involving 90,000 troops. Alarmed, the State Department subsequently succeeded in downsizing Gates proposal to “contingency” status.’’—James Ridgeway,Mother Jones

The Radicalization of Peter King

Peter King is, in one sense, uniquely qualified to hold hearings on the “radicalization” of young men to a terrorist cause: He may be the only member of the United States Congress to have undergone the process himself, at the hands of the Irish Republican Army.

Some of King’s  previous dealings with the IRA have been reported, but the depth of his embrace is best documented by Ed Moloney, author of A Secret History of the IRA and former Northern Ireland editor of the Irish Times and the Sunday Tribune, whose reportage on the IRA’s operations is second to none. Moloney now writes a  blog, The Broken Elbow, in which he recently recapped what he knows about King–including his links to none other than Col. Muammar Gaddafi, long known as an arms supplier to international terrorists:

The re-emergence of the old links to the IRA are embarrassing to Peter King and his response has been both utterly predictable and supremely dishonest – he has wrapped the peace process around himself as protection and justification for what he did. This is what he told the Washington Post:

‘ “I [wanted] a peace agreement, a working agreement, where the nationalist community would feel their rights would be respected,” King said in an interview at his Capitol Hill office. “I felt that the IRA, in the context of Irish history, and Sinn Fein were a legitimate force that had to be recognized and you wouldn’t have peace without them. Listen, I think I’m one of the people who brought about peace in Ireland.” ’

The facts, sadly for him, do not support any of this. King first came to Belfast in 1980 just when the first hunger strike, the one led by Brendan Hughes, was reaching a climax, and was radicalized by what he saw and experienced. He came back for the second hunger strike, and it was then he met the family of Bobby Sands, in particular his sister Bernadette and her then partner, now husband Micky McKevitt. He would visit them on every trip he made and often stayed in their home in Louth. When he was elected to Congress virtually the first thing he did was to jump on a plane to Ireland to host a celebratory dinner with Bernadette and Micky – and this was all at a time when McKevitt was masterminding the smuggling of Col Gaddafi’s Semtex and AK-47’s from Tripoli. In Belfast, King’s best friends were Anto’ Murray and his wife. McKevitt was the IRA’s Quarter Mster General  and Anto Murray was Belfast Operations Officer.

Moloney told me Thursday: “The point about the story is this: When King was most friendly with them in the 1980s, McKevitt was in charge of the smuggling of hundreds of tons of arms and explosives, including Sam-7 missile launchers, mortars, heavy machine guns, 1000’s of AK-47, 5-7 tons of Semtex, millions of rounds etc., provided gratis by Gaddafi. Given what is happening in Libya right now and that Gaddafi was, prior to Al Qaeda, main Muslim sponsor of international terrorism, it makes his hearings even more hypocritical. Add to that the fact that Libya was an enemy of the U.S. and the IRA was getting help from Libya–doesn’t that dent king’s claim that IRA never harmed America?” Furthermore, “One American was killed when the IRA bombed Harrods in London in 1983 and another wounded. So not quite true to say Americans were not directly affected.”

To summarize: Peter King is the last person in the world to be preaching about terrorism, including Muslim terrorism. The very idea that the U.S. Congress would put on such an odious display, led by this consummate hypocrite, humiliates the country at large.

Libya’s Exports to Europe: Oil and Immigrants

Muammar Qaddafi and Silvio Berlusconi have more in common than their   tastes for lavish parties and sexy young women, or even their notorious 2009 “friendship pact.” Despite being the buffoons of their respective regions, each wields considerable power. And they share a common destiny that revolves around two types of Libyan exports: fossil fuels, which Italy desperately wants, and migrants, which it decidedly doesn’t.

Franco Frattini, the Italian foreign minister, warned on Wednesday that the Libyan uprising could result in 350,000 unwanted immigrants landing on the Eur0pean continent. According to the Italian news site Adnkronos, Italy asked the EU for support in stopping the migrants, who most often enter through Italian shores.

”We ask that Europe do its duty,” he said during a Wednesday address to parliament in Rome. We want Europe to do more managing the flow of migrants because countries cannot be left alone.”

Italy in May 2009 agreed to begin controversial joint patrols with Libya, turning back thousands of illegal immigrants aboard boats in the Mediterranean.

Libyan leader Muammer Gaddafi hinted that he may unilaterally scrap cooperation, warning that he would allow thousands of migrants to pass through his country on the way to Europe if the EU sided with opponents of his embattled rule.

Qaddafi knows all too well how to frigthen European leaders–especially Berlusconi–who have right-wing, nationalist, anti-immigrant movements at their backs. And in normal times, this sort of scare tactic might have been enough to push Europe into aquiescence as differences were papered over in some sort of “reform.” But it is too late for that. Qaddafi totters, and no one can predict what will happen in the region. Emerging politics might at best result in some version of an Indian-style democracy, at worst chaotic Somali-style warfare with faction pitted against faction.

What may be even more frightening to Italy–and to much of Europe as well–is the prospect of losing Libya’s supply of oil and natural gas. Italy gets one third of its oil from Libya by way of the big oil company ENI. The company has already pulled out most of its employees and cut back the flow of natural gas through the pipeline that connects Libya and Italy.

ENI is the sixth largest oil company in the world. It is 30 percent owned by theItalian government, which has special rights to block mergers and sharply limit holdings of other investors. About 11 percent of the company securities are held by institutions including such big American mutual funds as Vanguard and Fidelity, along with Wellington Management, the big Boston investment management concern. The top 10 institutional holders control about 8 percent of the stock. Unlike the other majors, it has most of its reserves in politically volatile North Africa, which as the oil industry goes, remains relatively underdeveloped.

In turn, as Al Jazeera reports, several other international energy giants have stakes in Libyan oil and gas. Following the 2003 rapproachment with Qaddafi,

 European energy firms were quick to invest in the holder of Africa’s largest proven oil reserves, the eighth-largest in the world, while many others signed lucrative arms and construction deals.

Tony Blair, Britain’s former prime minister, signed a so-called “Deal in the Desert” in March 2004, which paved the way for oil contracts worth billions, leading to a close relationship that has come under increasing criticism.

It included Anglo-Dutch company Shell signing an agreement worth up to $1bn and three years later BP agreeing its largest exploration commitment to date, in a deal worth at least $900m in Libya.

A historical footnote: Both Libya and Italy have been important but little-known players in the evolution of Middle East oil. In March 1951 the nationalist government of Mohammad Mossadeq in Iran took over the oil industry from the Anglo Iranian Oil Company, which became BP. The CIA conpired to overthrow Mossadeq and installed the Shah. Then the U.S. stepped in with Herbert  Hoover, Jr., dispatched by President Eisenhower to reinstate the international cartel of big companies that for years had dominated the industry. Iran’s oil reserves were carved up amongst British, Dutch, French and for the first time, American interests. But it did not include Italy, which was entirely dependent on imported oil.

Angered at being cut out of the competition, Enrico Mattei, head of the Italian state company now known as ENI, went to war against the cartel, and after Suez in 1956 he persuaded the Iranian parliament to rewrite the country’s petroleum law to make way for a new sort of production system known as joint ventures. Under this arrangement the company and country became partners, and they replaced the old concessions. In short order, the joint venture opened the way for direct nationalization and the birth of OPEC.

Libyan Wild Card: The Qaddafi-Berlusconi Pact Against Migrants

By Sunday evening, the fighting in Libya was spreading to Tripoli, and the nation’s second largest city, Benghazi, appeared to be in the hands of the protestors. Over 200 people had been killed and hundreds more wounded by security forces, and Muammar Qaddafi’s son, Sayf al-Islam, was warning of civil war, and pledging that the government would ‘fight to the last bullet’ to stay in office.’’

The Libyan protests have been inspired by the wave of uprisings across North Africa, but they grow out of deep-seated poverty, unemployment, and political repression at the hands of yet another entrenched despot. Whether they will result in Libya achieving the sort of change experienced by Tunisia and Egypt is impossible to say, but early signs indicate that whatever the outcome, a high price is likely to be paid in human life.

Complicating matters is Libya’s unusual position in world affairs. Not long ago it was a pariah nation. But since 9/11 it has wormed its way back into favor with the US and Europe because Qaddafi joined the war on terror, cooperating in the Lockerbie bomb investigation, coming down hard on Al Qaeda, and kicking out terrorists he had once sheltered. At the same time, he has steered the country into an increasingly powerful position in world politics because of the nation’s vast oil reserves. Libya has an especially close relationship with its former colonial master, Italy. It now provides about 20 percent of all Italy’s oil imports and has invested in sizeable amounts in that country’s energy infrastructure including the transnational energy giant ENI.

Along with their energy deals, Berlusconi and Qaddafi have agreed to work together to stem the increasing numbers of migrants seeking a better life in Europe. In addition to those from North Africa itself are thousands more moving  up the Red Sea from Eritrea, Sudan, Somalia and other countries. Their point of entry is Italy–specifically, the small Italian island of Lampedusa, which lies in the Mediterranean at a midpoint midway between Libya, Tunisia, and Sicily. 

In 2009, Qaddafi and Berlusconi made an agreement that became part of an open and often vicious campaign against migrants: Libya would try to keep them from leaving in the first place; if they got out, Italy would send them back to Libya without giving them a chance to make asylum claims.

Human Rights Watch has documented the attacks on migrants in a detailed report called Pushed Back, Pushed Around:  Italy’s Forced Return of Boat Migrants and Asylum Seekers, Libya’s Mistreatment of Migrants and Asylum Seekers. Here is but a brief account of the two nation’s in action:

Many of the worst abuses reported to Human Rights Watch occurred after failed attempts to leave Libya. One of the migrants, “Pastor Paul” (all names have been changed), a 32-year-old Nigerian, told Human Rights Watch how Libyan authorities brutally treated him when the Libyans stopped his boat shortly after it left Libya on October 20, 2008:

“We were in a wooden boat, and Libyans in a [motorized inflatable] Zodiac started shooting at us. They told us to return to shore. They kept shooting until they hit our engine. One person was shot and killed. I don’t know the men who did the shooting, but they were civilians, not in uniforms. Then a Libyan navy boat came and got us and started beating us. They collected our money and cell phones. I think the Zodiac boat was working with the Libyan navy. The Libyan navy took us back in their big ship and sent us to Bin Gashir deportation camp. When we arrived there, they immediately started beating me and the others. They beat some of the boys until they could not walk.”

Even without the violence now being seen in Libya, the unrest in Tunisia launched a wave of 4,000 new migrants to Lampedusa from that country. They are being held in Italian refugee camps; but if similar numbers arrive from Libya, they will be summarily–and brutally–shipped home.

In the past, Qadaffi has patched up internal unrest and smoothed over human rights abuses by distributing more money from  energy profits, meanwhile calling on Europe and the U.S. to go easy on their new “ally.” Those on the right, in particular, are inclined to do so because he is a stalwart in the war on terror and an effective force in blocking immigration, a key political issue advanced by the right wing parties across the continent.