By Daniel Canty
Klesch and Co to enhance national downstream capability.
Libya African Investment Portfolio, represented by Abdulfatah Sharif has signed a joint venture agreement with London-based Klesch and Co to invest in building a vast industrial complex of a new 300,000 barrels per day capacity oil refinery, and a 725,000 tonnes per year Aluminium smelter in Libya.
The deal represents an investment of approximately US$8 billion.
The complex is scheduled for completion in 2011 and will use the latest technology allowing it to optimise the production of finished goods. Both parties also confirmed their interest in jointly developing the mining and refining of Bauxite in Western Africa.
"We are delighted to have signed this agreement," said Sharif. "We welcome the investment and the development of our infrastructure and are extremely impressed with the Klesch organisation," he added.
"We welcome the opportunity to work alongside the Libyan Government in developing their downstream capabilities and firmly believe in the long-term growth prospects of the country and are supportive of their economic development plans," said Gary Klesch.
The Libyan economy depends primarily upon revenues from the oil sector, which contribute about 95% of export earnings, about one-quarter of GDP, and 60% of public sector wages.
Attracting much needed investment picked up steam after UN sanctions were lifted in September 2003 and as Libya announced in December 2003 that it would abandon programs to build weapons of mass destruction.
Almost all US unilateral sanctions against Libya were removed in April 2004, helping Libya attract more foreign direct investment, mostly in the energy sector. Libyan oil and gas licensing rounds continue to draw high international interest; and the National Oil Company set a goal of nearly doubling oil production to 3 million bbl/day by 2015.