Country Report - Zawya

10 Libya
BP is embroiled in accusations
over the release of Mr Megrahi
Monthly review: August 2010
The political scene
A US Senate Foreign Relations Committee hearing into the release of
Abdelbaset al-Megrahi, the only man convicted of the bombing of passenger
airline over Lockerbie in 1988, from a Scottish jail in August last year, due to be
held on July 29th, was indefinitely postponed after all the witnesses it
requested to appear declined the invitation. A committee member and
Democratic senator, Robert Menendez, had called on the former British justice
secretary, Jack Straw, the Scottish justice minister, Kenny MacAskill, and the
former BP chief executive, Tony Hayward, to testify at the hearing. But as the
committee has no jurisdiction over non-US nationals, all declined to attend.
The hearing sought to examine the interplay between the British and Scottish
governments and about the communications between the British government
and BP in this matter. They have made clear that they hoped the process could
result in Mr Megrahi being sent back to jail and in BP being prevented from
proceeding with its contract to invest US$900m in oil and gas exploration in
Libya. They have also urged the British government to launch a formal inquiry
and to investigate in particular a letter sent in July 2009 by Lord Trefgarne, the
head of the Libyan British Business Council—of which BP is a member—
stressing to Mr MacAskill that there would be serious implications for UK-
Libyan relations if Mr Megrahi were to die in prison. Lord Trefgarne said last
year that there would be benefits to UK businesses from the release of
Mr Megrahi.
US Senators have suggested that Lord Trefgarne's letter may have facilitated BP's
operations in the Libyan market. According to another senator, Kirsten
Gillibrand, the committee has seen "an abundance of circumstantial evidence
that the British and Scottish governments may have circumvented justice and
organized his release in order to secure a lucrative oil drilling concession for BP".
BP has denied direct involvement in Mr Megrahi's release, although admits it
lobbied the UK government over the signing of a prisoner transfer agreement
(PTA) with Libya in 2007, arguing that delays in the PTA would have a "negative
impact on UK commercial interests". It is also important to point out that BP's
drilling concessions remain far from proven to be lucrative. Instead they are a
major commitment and investment in Libya with no certainty of returns, which
undermines the argument that BP would have needed to secure the release of
Mr Megrahi. However, it is plausible that the Libyan authorities could have
made it easier for BP to operate in the country by, for example, removing
obstacles to importing equipment, on the basis that the company had helped to
secure the release of Mr Megrahi. Similar allegations were made at the time of
Mr Megrahi's release.
In support of BP, the Scottish Executive denied having any contact with BP, and
the British foreign secretary, William Hague, stated in a letter to John Kerry,
chairman of the Senate Foreign Relations Committee, that there was no
evidence to support the allegations being made that BP and the Scottish
Country Report August 2010 www.eiu.com © The Economist Intelligence Unit Limited 2010