The Rush for Libyan Oil Is On, and the Battle in Tripoli Isn't Even Over

Less than 24 hours after rebels swept into Libya's capital Tripoli, foreign oil companies led by Eni of Italy and BP are already plotting their homecoming. It's premature, to be sure. But with Africa's largest oil reserves and billions of dollars on the line, oil producers are scrambling to secure a spot with the rebel group. And not every company is going to make the cut.

Fighting hasn't stopped in Tripoli in the west and Libyan dictator Muammar Gaddafi is no where to be found. That didn't stop Eni, Libya's leading foreign oil producer, from sending staff to look at restarting facilities in the east of the country, Reuters reported. BP, Total (TOT) , Shell (RDS), Russia's OAO Gazprom, Spain's Repsol YPF and BASF SE have all indicated -- some more cautiously than others -- they're ready to get back into Libya. Meanwhile, Qatar's national oil company and trader Vitol -- which don't currently have operations there -- are hoping to gain entry into Libya.

Possible winners under the rebel's National Transitional Council include Qatar's national oil company and Vitol, both which provided signifcant support during the war. Eni and other companies connected to allied NATO countries also will benefit.

The loser: BP?
That is, with the possible exception of BP. The UK oil company had a cozy relationship with the Gaddafi-controlled government that the U.S., among other nations, criticized.

BP managed to secure an accord with the government that allowed it to drill offshore and at an onshore site in the desert of Ghadames. The company was later accused of negotiating the 2009 release of the Lockerbie Pam Am Flight 103 bomber in exchange for access to Libya's oil reserves.

Unlike companies like Eni that have established production facilities in Libya, BP's exploration project was still in its early stages of development. The company didn't have much infrastructure in place when the war broke out earlier this year, the WSJ reported.

BP has a lot to to lose if it fails to gain reentry into Libya. Last year's Gulf oil disaster has put considerable pressure on BP's operations. It's still waiting for approval from U.S. regulators to restart exploratory drilling in the Gulf of Mexico and its landmark Arctic oil deal with Russia' Rosneft were crushed earlier this year.

BP's approach isn't as aggressive as Eni. Still, the company's eagerness to get into Libya stands out compared with its Western rivals ConocoPhillips (COP), Hess, Occidental (OXY) and Marathon. All of those companies pulled out of Libya in early 2011 and are waiting until a specific group or government is in charge before it tries to return.

Photo from Flickr user Vectorportal
Related:

• Libyan Unrest: Every TransCanada Pipeline Supporters' Dream
• Sucker Play: Goldman Sachs Lost $1.3 Billion of Libya's Money