Word: exxon
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...treacherous place for Western oil companies to pump crude. In 1973 Gaddafi seized a 51% share of all U.S. oil operations in Libya and threw Texas Oilman Bunker Hunt out of the country altogether. But last week an oil company reversed roles and walked out on the colonel. Exxon announced that it was withdrawing all its oil and gas operations from Libya. The company will turn over to Gaddafi its 49% stake in oilfields capable of producing 150,000 bbl. per day, plus a refinery and natural gas complex near the port city of Brega. Estimated value of Exxon...
...Exxon refused to explain why it was departing abruptly from Libya or to say whether it would receive compensation for its property. The company's relations with Gaddafi's regime have been openly hostile for months. Last June the oil company complained that Libya's premium price of $41 per bbl. was outrageous and began sharply curtailing production from its Libyan wells. At the same time the company was worried because some of its workers at the Brega facilities were being forced out of their homes to provide more housing for soldiers in Gaddafi's growing...
Energy analysts speculate that pressure from Washington may have played a part in Exxon's decision. After U.S. Navy planes shot down two Libyan jets over the Mediterranean last summer, the State Department sent a letter to American oil companies calling for their cooperation with the Administration's efforts to cut off U.S. relations with Gaddafi. Says Elihu Bergman, executive director of Americans for Energy Independence: "I'm sure that some jawboning took place between the Administration and Exxon." While the State Department took no credit for Exxon's move, one pleased official said that...
...Like Exxon, other oil companies operating in Libya are discontented, particularly with Gaddafi's high prices, royalties and taxes. Mobil, for one, announced late last week that it was considering pulling out. Only Occidental, which negotiated a special price concession from Gaddafi two months ago, says that it firmly intends to stay in Libya...
...Exxon's action last week was made much easier by the current world glut of oil. The major petroleum companies are now well stocked with crude because consumption has been falling. Rather than causing a shortage of petroleum, the loss of Libyan production will just mean a little less for Exxon to put into storage tanks...