April 26, 2018 / 4:07 PM / a month ago

Total CEO says Libya raised no objections over Waha deal

* Total CEO says deal closed on March 31

* Says informed Libyan authorities

* Says Total will develop field in Libyan interests

By Bate Felix

PARIS, April 26 (Reuters) - Libyan authorities were informed before French energy major Total closed a $450 million deal with Marathon Oil to take over the U.S. firm’s 16 percent share in the Waha concession, Total’s chief executive said on Thursday.

Patrick Pouyanne told analysts during Total’s first-quarter earnings call that despite reports that the deal could hit a snag over Libyan displeasure, Libyan authorities raised no objections before it closed on March 31.

“We informed Libyan authorities far in advance that the deal had been settled between Total and Marathon and we were intending to close it by the end of March,” Pouyanne said.

“From a strictly legal point of view, neither in Libyan law nor in the oil concession agreement is there a request for a formal approval,” he said, adding that as of now, the shares of Marathon in Libya were with Total.

“We informed them. There was a target for us for the end of March to close the deal, we wrote to them again before, there was no objection and so we decided to close.”

Libya is considering whether to intervene and its options include pushing for better terms, sources have told Reuters.

Libya’s National Oil Corporation said on Monday any such deal “must have the approval of NOC and the Libyan authorities” and “any attempt to conclude the sale prior to this approval would be in breach of the concession contractual agreement”.

A government source also said the deal needed formal Libyan approval.

Pouyanne said Total was able to move in and rapidly close the unplanned deal because it was willing to take in the political risk of the Libyan situation.

Libya, an OPEC member, has been mired in seven years of turmoil that have hit its oil sector.

“Total can take these kinds of Libyan risk in our portfolio more than Marathon was willing to keep them, which is why we did the deal,” he said.

Total said the Waha concession represented about 500 million barrels of oil reserves with production of around 50,000 barrels per day.

“The cost of access to these barrels was quite attractive due to the political situation. Maybe it created some moves in Libya after they discovered the value of the deal, but the terms of the concession did not change,” Pouyanne said.

Seeking to sooth concerns in Libya, Pouyanne said the company was in permanent dialogue with Libyan authorities.

“We will give them all the comfort they are legitimately requiring, to reassure them of our willingness to develop the Waha field in the national interest of Libya,” he said. (Additional reporting by Aidan Lewis; Editing by Dale Hudson)

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