Oasis Group

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OASIS GROUP

consortium of three u.s. oil companies in libya.

The Oasis Group (originally the Conorada Group) is a consortium composed of three U.S. "independent" oil companies: Amerada (now Amerada Hess), Continental (now ConocoPhillips), and Marathon. Bidding independently, the companies won concessions throughout Libya during the first auction of oil rights in 1955. Following the concession awards, the Oasis companies pooled their acquisitions. By 1965, when Libya opened a second round of concession bidding, Oasis was the number two producer of oil in Libya, bringing in more than 300,000 barrels per day.

Beginning in mid-1970, Libya's militant post-revolutionary government threatened to limit or halt oil production in selected concessions unless their owners agreed to higher prices. Two weeks after Occidental Petroleum capitulated to this pressure, the Oasis Group followed suit. The government continued its pressure on foreign oil companies. It nationalized part of Oasis, amounting to 51 percent by 1973.

Meanwhile, U.S. relations with Libya deteriorated steadily, reaching a nadir in 1986 when the United States imposed economic sanctions as part of President Ronald Reagan's declaration of war against terrorism. The Oasis partners were three of only five U.S. oil companies to retain properties in Libya after sanctions were imposed, by that time amounting to only 40.8 percent of Oasis. In 1992 the addition of United Nations sanctions further dimmed prospects for U.S. oil companies hoping to resume operations in Libya.

UN sanctions ended in 1999, following the Libyan government's surrender of suspects in the Lockerbie bombing of Pan Am flight 103. The ending of sanctions brought foreign oil companies back to Libya, but continuing U.S. sanctions prevented U.S. companies from returning. Despite energetic lobbying, Congress passed a five-year extension of U.S. sanctions in August 2001, and Libya remains on the State Department list of countries accused of sponsoring international terror. Oasis companies continue their efforts to be allowed to resume operations in Libya. They face the prospect of losing their properties if the Libyan government decides that progress in negotiations with the United States to end the sanctions is unlikely to bear fruit. A large number of foreign companies are eager to acquire concessions in Libya and could bid on the Oasis properties if and when they are re-tendered by the Libyan government.

see also libya; occidental petroleum; petroleum, oil, and natural gas; petroleum reserves and production.