18-07-08 Four of Europe's biggest energy groups rewrote two large oilfield contracts with Libya, agreeing to significantly worse terms for the right to keep working there.
Total of France, StatoilHydro of Norway, Spain's Repsol and Austria's OMV agreed to pay a $ 1 bn signing bonus for the contracts, which extend their stakes in the projects for another 10-15 years to 2032. The onshore fields, which lie 700 km south of Tripoli, produce 300,000 bpd, with output expected to rise to 380,000 bpd in 2012.

The two contracts cover block NC115, in which Total and OMV have 30 % stakes and Repsol the remaining 40 %. In the other block, Total and OMV each hold a 24 % stake, Repsol has 32 % stake and StatoilHydro holds the remaining 20 %.
The announcements came a month after ENI, the Italian oil group, renegotiated all its contracts in Libya and is the latest example of how high oil prices are leading to oil-rich governments from Kazakhstan to Alaska demanding better terms and a bigger share of the profits. International oil prices traded at just shy of $ 130 a barrel, more than double a year ago, but down from recent record of more than $ 147.

But while many countries chose to increase taxes or rewrite their laws for future contracts, Libya took the bolder step of demanding existing contracts be scrapped. Under the agreement, the four companies will receive 12-13 % of the gross field production in the two fields and will pay the bonus over three years, with the sum being divided between the companies, according to each stake.
Helmut Langanger, head of exploration and production at OMV said the new contracts were worth the "extended access to those world class fields."