Occidental Petroleum Corp returns to Libya

Occidental Petroleum Corp. announced of Friday that it has received approval from the Libyan government to once again begin operation there.

It will be the first time the US oil company has conducted business in Libya since the administration of President Ronald Reagan slapped sanctions on the African country in 1986 after a bombing in Berlin that was blamed on Libyan-backed terrorists.

In the intervening years, Occidental’s facilities have been operated by the state oil company. Besides its old oil fields, Occidental won new blocks in an auction in January.

Occidental will become the first US oil company to return to Libya since the US sanctions were lifted in April 2004. Other oil companies are looking to return to Libya as well. Chevron and Amerada Hess also won new exploration licenses in the January auction.

An Amerada executive said that it would return to Libya eventually, but that the timetable for that return was not certain.

Occidental’s return to Libya will add 12,000 to 15,000 barrels of oil per day to its production by the end of the year. After the announcement, shares in Occidental remained steady at $83.03 in late morning trade on the New York Stock Exchange.