Dozens killed in Tripoli suburb under siege

On the outskirts of Libya’s capital, Tripoli, the residents of an area known as Warshefana are surrounded on all sides by armed militias who, in addition to attacking built-up areas, have imposed what amounts to a siege, blocking the entry of food and medicine.

The fighters form part of a militia coalition that took effective control of Tripoli two weeks ago. They have been heavily shelling Warshefana from their surrounding positions for the last week and have so far killed more than 70 residents, including at least 12 children. An additional 140 are believed to be injured.

The Warshefana are a tribe often seen as having been loyalists to Moammar Gadhafi’s regime. They once supported militias from Zintan, including Othman Mlekta’s al-Qaqaa, in their long battle in Tripoli against allies of their attackers. The militias now besieging the tribe see its members as traitors to Libya’s revolution, which they claim to be upholding.

According to residents who have spoken to local media, the Warshefana’s al-Zahra Hospital is short on supplies, yet the casualties keep coming. Militias have burned some Warshefana houses, and one Warshefana official claimed that the militias have bulldozed houses.

The fighters, primarily from the town of Zawiyah, are aligned with the Fajr Libya (Libya Dawn) coalition that captured Tripoli International Airport on Aug. 23. The group has re-declared the authority of the previously disbanded Islamist-aligned General National Congress (GNC) in the capital, in opposition to the newly elected parliament in Tobruk.

The Zawiyan forces are led by Shaaban Hadia, also known as Abu Obeida al-Zawi, a prominent commander and head of the Libyan Revolutionary Operations Room, the group that kidnapped former Prime Minister Ali Zeidan in October. Hadia was arrested in Egypt in January but then released in exchange for the freedom of five Egyptian diplomats taken hostage in Libya by his fighters.

On Sept. 9, rockets likely fired by the Zawiyah forces hit homes in the Siyad area, killing 13 people, including a family of five and their three neighbors.

The attack on the Warshefana tribe is part of a wider struggle for supremacy that is taking place across Libya between various feuding factions defined by regional identity, pragmatic alliances and, occasionally, ideology.

“There are ideological justifications given for the violence against Warshefana, as in the rest of Libya, but there are also pragmatic underpinnings to this attack,” said Claudia Gazzini, a Libya analyst at the International Crisis Group.

“The attack on Warshefana began as a criminal operation by Zawiyan forces who believed elements of the Warshefana were essentially a criminal gang and should be held accountable. It was supposed to be an anti-gangster operation,” she told Al-Monitor.

“This attack is also part of a struggle that is about winning and eliminating enemies. But it is not only a struggle for power, it is also a struggle for survival between these groups that is playing out nationally,” she said.

The Warshefana roughly fall into an alliance of forces, along with the Zintani militias of al-Qaqaa and the al-Madani Brigades; the Saiqa militia in Benghazi, led by Col. Wanis Bukhamada; and a group of senior military officers led by the retired Gen. Khalifa Hifter, which supports Libya’s House of Representatives parliament in Tobruk and its government led by Abdullah al-Thani.

The Libyan Revolutionary Operations Room and other Zawiyah militias are aligned with a group of militias from Misrata that operate under the banner of Libya Dawn, including the powerful Libya Shield One, which is coordinated by retired GNC member Saleh Badi.

They have long been building closer ties with Libya’s Muslim Brotherhood, and they support the GNC, which they re-declared in Tripoli following the elected House of Representatives’ withdrawal from the capital. On Sept. 7, the GNC declared its own cabinet led by Omar al-Hassi to rival that of the House of Representatives.

Since the Libya Dawn forces took control of the Tripoli airport, there have been indications of revenge attacks against opposing forces that used to be based in the city. The homes of as many as 80 families from Zintan may have been “attacked and looted,” and dozens of Zintanis have been kidnapped, according to a report by the Crisis Committee of Zintan’s municipal council. Fighting in Tripoli has certainly caused serious damage. The Tripoli local council stated that violence has displaced at least 12,600 families.

The security situation around Tripoli is so tenuous that the House of Representatives has even taken up residence offshore. A luxury ship known as the Elyros has been hired for the families and guests of the 188 parliamentarians to live and meet on, and is docked at Tobruq port.

The ship’s presence split the House with some members, including Tripoli representative Mosab al-Abed, claiming they would refuse its comforts, but others have taken to it. Libya’s elected parliament’s meeting not only far from the capital but also away from land has led some to question just how distant the parliament has become from the people.

Both the Libya Dawn coalition and forces loyal to Hifter have recently made advances toward Libya’s southern tribes. Misrata forces sent a delegation led by Mohamed al-Raqoubi to the Amazigh town of Obari to deal with the Tuareg. The Tuareg leaders rejected the Misratan appeal for support two days later.

However, as many as 1,000 fighters of the Tebu minority from southwest Libya are currently heading to Benghazi to reinforce Hifter’s forces after a similar delegation requested their support in fighting the Islamist militia Ansar al-Sharia, led by Sheikh Muhammed Ali al-Zahawi.

Islamist militias aligned with Ansar al-Sharia — who are still fighting Hifter’s anti-Islamist group — are believed to have kidnapped 25 soldiers and killed five more in Benghazi on Sept. 10. Their forces recently withdrew from fortified positions in the city in advance of an expected major assault by Hifter.

“The attack on Warshefana is a strong reminder that it is a war crime to attack and shell civilian areas, and that where there are problems in Libya, they must eventually be dealt with through negotiations,” Gazzini said. “The only strategy for bringing things forward is for people to have the courage to engage in dialogue and for all sides to recognize that they will have to give things up to bridge the gaps and unify.”

An official in Libya’s Ministry of Foreign Affairs added, “We have constantly condemn acts of violence in and around Tripoli, and have specifically condemned the shelling as criminal. We’re coordinating with the Supreme Council of Libya’s elders in order to reach a peaceful settlement.”

This article was originally published with Al-Monitor on September 14 2014.

A political prisoner’s story in Western Sahara

Amnesty International on Wednesday broke news that seven Sahrawi hunger strikers had ended their fast, reportedly after being promised better prison conditions, but the victory is a small one and only helps to illustrate the wider abuses going on behind the scenes in the Western Sahara.

Last Sunday, Moroccan security forces arrested six Sahrawi demonstrators in the occupied territory of Western Sahara after protests broke out in response to the death of a hunger striking Sahrawi prisoner, Hassana al-Wali.

Veteran activist Wali died in a military hospital in Western Sahara’s second city, Dakhla, on 27 September. He was said to be seriously ill as a result of the hunger strike, and slipped into a fatal coma while in custody. Wali was an active member of the pro-independence indigenous Sahrawi movement and was also known for his human rights work on torture and police brutality.

Western Sahara is a United Nations designated non-self-governing territory that has been subject to an occupation by Morocco since it invaded in 1975. Morocco, however, claims the territory forms its “southern provinces” and is part of a historic “greater Morocco” with Rabat maintaining near full control of the area.

The Sahrawi government in exile, the Sahrawi Arab Democratic Republic (SADR), opposes the occupation and claims that 30 Sahrawi political prisoners have gone on hunger strike this year alone.

Mistreatment and abuse

The story of Wali’s death begins with his arrest during demonstrations linked to the Arab Spring uprisings. He was detained and sentenced to three years’ imprisonment for his involvement in pro-independence, anti-government protests in Dakhla in November 2011.

According to one Sahrawi who had contact with Wali and his close friends and who requested anonymity for security reasons, Wali suffered mistreatment by the security forces that arrested him. The Moroccan forces broke his arm and inflicted other injuries, with the individual obtaining images that show the extent of the abuse.

After being sentenced to jail for “participation in an illegal demonstration” and “forming a gang”, Wali was taken to a detention facility in Western Sahara’s would-be capital city Laayoune. It was there, in a facility known as the Carcel Negra (Black Prison), that Sahrawi sources say that Wali first began a hunger strike to protest his torture at the hands of security forces.

Wali was moved from the Carcel Negra to Dakhla prison in June 2013 where his health began to deteriorate. His broken arm had never fully healed, due to a lack of access to medical care, and the general conditions of the prison in Laayoune were extremely poor. In September of this year, his health again seriously worsened under the strain of a renewed hunger strike over prison conditions.

But according to Sahrawi activists from Dakhla, it was only after persistent pressure from friends and family that Wali was eventually taken, in custody, to a civilian hospital and then a military hospital in the city. He died shortly after arriving at the military facility.

“I knew Hassana for decades, he was a brave campaigner, especially on the issue of removing the landmines laid by the Moroccan army in Western Sahara because his father was killed by a landmine,” said Mohammed al-Baikam, the secretary-general of the fishing associations of Dakhla and a friend of the deceased.

Wali’s activism saw him meet with international delegations that visited Western Sahara. He received a European parliament delegation in 2009, and met with an independent UN expert on cultural rights, Farida Shaheed, months before his incarceration in 2011.

“The Moroccan government wanted him in prison for years because of his stand against torture and police violence, they wanted him silenced and now they have finally succeeded,” Baikam told Middle East Eye.

According to Baikam, Wali was subjected to serious torture in Moroccan detention facilities. His account details how Wali was hung from the ceiling by his feet and beaten with a stick, forced into a humiliating stress position known as the “chicken position”, and given electric shocks.

Sahrawi friends of Wali also claimed he was treated with negligence in the runup to his death, and that he wasn’t given access to proper medical treatment. They claimed that only cursory checks were performed despite his bad health, and that the only treatment he received was a dose of glucose administered by injection, which resulted in him lapsing into the coma that killed him.

The authorities have denied this and the Moroccan Délégation Générale de l’Administration Pénitentiaire (General Delegation of the Prison Administration) in Dakhla insisted that Wali was treated appropriately.

“The deceased had received throughout the period of his detention necessary care, with a number of medical examinations and treatments… he enjoyed good health and had not complained of any chronic disease,” the organisation said in a statement.

“He underwent an endoscopy in l’hopital Hassan II last Thursday before entering suddenly into coma,” the statement added.

But Baikam continued to assert that the prison authority’s statement is incorrect. “The next day the family asked the wali [governor] of Dakhla for an autopsy and were met with complete refusal, then the wali offered them money to have the body buried without one,” Baikam said. “Why would they do that if he was properly treated?”

The Moroccan government told Middle East Eye that the attorney general’s office has been informed of Wali’s death in custody and is awaiting an autopsy.

Juan Mendez, the United Nations special rapporteur on torture, visited Morocco and Western Sahara in September 2012 to assess claims that the conditions in Moroccan prisons were unacceptable and that Moroccan authorities were using torture.

Unacceptable conditions

“In Western Sahara we documented cases of serious torture by combining credible accounts with forensic evidence,” Mendez told Middle East Eye.

“The prisons were overcrowded and living conditions were precarious, but much of the serious torture was in fact happening before detainees got to prison.”

Before his incarceration, Wali was a senior member of the Sahrawi Association Against Torture, and while in prison in Laayoune, his family said he was interviewed by Mendez.

“I don’t remember meeting Hassana specifically, but I met with many prisoners in Western Sahara and it is very likely I met him,” Mendez said.

Mendez also said that Sahrawi activists in favour of independence and separation from Morocco were being treated like detainees held on terrorism charges.

“Torture was not for everyone, it was being used in the high-profile cases: against terrorism suspects, and against members of the separatist movement [pro-independence Sahrawi]. It was consistent and could be very severe,” he said.

“I will be writing to the Moroccan government to make an enquiry about what happened here,” he added.

Amnesty International has also documented the use of torture by Moroccan security forces. On 19 September they reported that seven more Sahrawi men who were “severely beaten” in the courtyard of a Moroccan jail in Western Sahara had started a hunger strike. The men ended the strike this week after being promised better conditions by the authorities, but their cases is just one of many.

The organisation has detailed numerous instances of Sahrawi prisoners going on hunger strike to protest police brutality and ask for better conditions. However, mistreatment and torture continue.

The methods of torture documented by Amnesty Intentional include stripping detainees naked and beating the genitals and soles of the feet. They also found evidence that the police were suspending detainees by the wrists while beating them; gagging prisoners with urine-soaked materials; using prolonged solitary confinement; and using sexual violence, including rape with bottles.

Eyewitnesses in Dakhla have said that there is currently a heavy police, military, and auxiliary forces presence in the city, designed to stop demonstrations in front of the military hospital where Wali died. They also stated that there have been large clashes between police and Sahrawi residents, and that protests that have been held despite government efforts to keep people off the streets.

“Hassana Wali was treated terribly in prison, like an animal. His condition was getting worse, and he was left without any mercy in his cell despite his requests,” said Mohamed Sidati, the Sahrawi representative to the EU from the SADR government in exile.

In light of Wali’s death, Sidati has decided to call on the European Union for support in investigating the treatment of Sahrawi prisoners in Moroccan-controlled Western Sahara.

“Given the European Union’s close relationship with Morocco they cannot continue to stand idly by. The European Union must use its influence and all the tools it has available to put an end to the Moroccan authorities exacting flagrant abuses on the Sahrawi prisoners’ human rights,” he wrote in a 29 September letter addressed to the European parliament and the European commission.

Sidati added in the letter that Wali was subject to cruel treatment because of his political views and human right advocacy after a politically motivated sentence, and that there should be no impunity for those responsible.

“We are calling for an international investigation to be opened because we believe the EU has the influence to push to determine and punish those who were involved in the death of Hassana Wali,” he said.

The Conseil Royal Consultatif pour les Affaires Sahariennes (CORCAS), an advisory committee set up by the Moroccan palace, did not respond to repeated requests for comment on either Wali’s death, or the use of torture by Moroccan security forces.

The Moroccan government’s official spokesperson did not respond to requests for comment on torture in detention facilities in Western Sahara.

There are currently believed to be more than 70 political prisoners held by the Moroccan government in detention facilities in Western Sahara and Morocco.

This article was originally published with Middle East Eye on October 2 2014.

US oil company set to violate international law in Western Sahara

Kosmos Energy, a US oil and gas exploration firm, along with UK oil exploration company, Cairn Energy, are planning to begin searching for oil reserves off the shores of a territory known as Western Sahara.

However, according to Sahrawi representatives, the companies have no authorisation from the people of Western Sahara, a United Nations designated non-self-governing territory larger than the UK that has been subject to occupation by neighbouring Morocco since it invaded in 1975. The Moroccan government maintains that its civilians peacefully reclaimed Western Sahara by marching into the territory, but scholarly work has long since falsified this account.

The UN has been planning to organise a referendum on self-determination in Western Sahara since 1991 but for now Morocco has successfully blocked the plans and retains control of the territory which it claims as its “southern provinces” and calls Moroccan Sahara.

Kosmos has held rights to explore Western Saharan waters since 2006, when it signed an agreement with Morocco’s state oil company, the Office National des Hydrocarbures et des Mines (ONHYM).

The agreement was renewed in 2011 and, at Kosmos’s direction, a drill ship named Atwood Achiever is currently on its way from South Korea to Western Saharan waters in order to commence oil exploration in a block known as Cap Boujdor in November.

In a letter dated 19 September and addressed to Kosmos’s Senior Vice President, William Hayes, which has been seen by Middle East Eye, the Sahrawi Centre for Media and Communication – a campaigning group made up of indigenous Sahrawi and based in the territory’s capital Laayoune – condemned international energy companies planning to drill for “joining hands with Morocco” and “consolidating its sovereignty over Western Sahara.”

“Formally, it is illegal for international companies to operate in the land and coastal waters of Western Sahara without the consent of its people and without them being consulted and benefiting from these business operations,” the letter stated.

“Such illegal business is also a direct threat to the whole peace settlement as it puts at stake the right of self-determination by ignoring international law and legality,” the Sahrawi group claimed.

However, the Sahrawi are not alone in believing that oil exploration in Western Sahara without authorisation from the Sahrawi would be illegal under international law. In 2002, the UN Under-Secretary-General for Legal Affairs, Hans Corell gave a legal opinion which agreed with the Sahrawi.

“If further exploration and exploitation activities were to proceed in disregard of the interests and wishes of the people of Western Sahara, they would be in violation of the international law principles applicable to mineral resource activities in non-self-governing territories,” Corell wrote.

A number of previous attempts by oil companies to drill in Western Saharan waters have been abandoned, due to the legal status of the territory and subsequent divestment by shareholders. Kosmos, however, appears resolute and French oil major Total also has plans to drill next year.

Kosmos has defended its decision by arguing that while it does not have the authorisation of the Sahrawi, its activities will be beneficial to them.

“We believe that, if exploration is successful, responsible resource development in Western Sahara has the potential to create significant long-term social and economic benefits for the people of the territory,” Kosmos wrote in a statement on the issue in February.

But the UN’s Corell has made clear on multiple occasions that this is not sufficient to make the drilling lawful. In 2008, he issued a clarification of his original legal opinion that described it as “formulated in such a manner that it would be crystal clear that Morocco had no authority to engage in exploration or exploitation of mineral resources in Western Sahara if this was done in disregard of the interests and wishes of the people of Western Sahara.”

Speaking to the Financial Times on 17 September, Corell said that “the more resources are found in Western Sahara and its maritime zone, the less will be the incentive for Morocco to fulfil the UN resolutions and international law.”

Neither Morocco’s ONHYM nor the Moroccan government responded to requests for comment.

The Sahrawi population is divided into those still living in the occupied territory, and the thousands who fled from the Moroccan army in 1975 and became refugees living in camps in South-West Algeria.

Sahrawi living in the refugee camps are also highly critical of the drilling.

“Kosmos and Cairn plan to participate in the looting of our country,” said Kamal Fadel a representative of the Sahrawi government in the camps, the Sahrawi Arab Democratic Republic (SADR).

“This is a shameful act by Kosmos and Cairn that puts their greed before the respect of legality and human rights, and it helps perpetuate the illegal occupation of our homeland, encouraging Morocco to continue to obstruct UN efforts to resolve the conflict,” Fadel told MEE.

International firms in other sectors besides energy have also engaged in potentially illegal resource exploitation in occupied Western Sahara.

Last October, the Canadian agricultural firm Agrium Inc. organised a deal with the Moroccan state phosphate company Office Chérifien des Phosphates (OCP) for Western Saharan phosphate.

Despite international pressure, more than $10 mn of phosphate rock mined by Morocco’s OCP in Western Sahara were loaded onto a freighter and shipped to Vancouver for use by Agrium as a result of the deal.

In December, the European Union also approved a four-year accord with Morocco, allowing EU boats – the majority of them Spanish – to fish in Western Saharan waters. Demonstrations were held in Laayoune by some Sahrawi but were met with a harsh response from Moroccan security forces.

“A significant oil or gas find in Western Saharan waters will only increase Morocco’s unwillingness to recognise the territory’s international right to self-determination,” said Jacob Mundy, assistant professor of Peace and Conflict Studies at Colgate University, in New York.

“The danger in all of this is the Security Council’s lack of interest in the Western Sahara situation generally,” Mundy told MEE.

“Having watched Morocco plunder the territory’s fisheries and minerals for years, it is difficult to imagine the Western Saharan independence movement remaining passive in the face of these new offshore developments.”

This article was originally published with Middle East Eye on September 28 2014.

Gulf hands in Libya

As two opposing governments emerge from the violence and chaos in Libya, the Arab Gulf states are competing for influence and using Egypt as a stepping stone.

An official delegation from Saudi Arabia arrived in Cairo on 7 September for high-level meetings with Egypt’s military-backed president, Abdel Fattah al-Sisi, and Libya was at the top of the bill.

President Sisi met with Saudi Arabia’s Foreign Minister, Prince Saud al-Faisal, and the kingdom’s head of intelligence, Prince Khalid bin Bandar. Sisi was joined by Egyptian foreign minister, Sameh Shoukry, and Egypt’s intelligence chief (and former mentor to Sisi) General Mohamed Farid al-Tohamy.

“The meeting addressed the situation in Libya and the need to support the elected Libyan parliament (the House of Representatives,) which is reflective of the popular will,” according to President Sisi’s spokesman, Ambassador Ehab Badawy, who noted that other topics were also covered.

Rumours have proliferated of Gulf intervention in Libya after Sukhoi Su-24 aircraft (which the Libyan Air Force is no longer believed to operate) struck Misratan targets in Tripoli last month. Pentagon officials claimed UAE pilots flying out of Egyptian airbases were responsible.

Saudi Arabia, the United Arab Emirates, and the Egyptian intelligence service are all backing Libya’s new elected parliament, the House of Representatives (HoR), and the anti-Islamist alliance that surrounds it, which they claim is the legitimate governing authority.

However, the HoR’s relevance in Libya is dwindling.  As one of its first decisions, the HoR chose to relocate parliament even further away from Tripoli to Tobruq. Plans to hold parliament outside of the capital in Benghazi were orginally devised in March, but as Benghazi became too dangerous amid ongoing battles between retired General Khalifa Haftar and Sheikh Muhammed al-Zawahi’s Islamist militia Ansar al-Sharia, saw members move operations to Tobruq, close to the Egyptian border.

Describing the meeting with the Saudi delegation, Mr Badawy stressed Egypt’s concerns about Islamist groups operating in Libya.

“President Sisi stressed Egypt’s commitment to bringing about political stability and restoring security in Libya, so as to prevent it from sliding into the hands of terrorists, and reviewed Egypt’s efforts in this regard,” he said.

However, security is in short supply. A militia coalition from Misrata that is broadly supportive of Islamist political forces, including Libya’s Muslim Brotherhood, have seized effective control of most of Tripoli and re-declared the previously disbanded parliament, the General National Congress, in the capital.

The Misratan forces were coordinated by a former GNC member named Saleh Badi, who was previously appointed head of military intelligence by the then Islamist-backed GNC speaker, Nuri Abu Sahmain, but whose nomination was spurned by high level military officers, some of whom have now joined General Hifter’s forces in Benghazi.

A high-level meeting between Saudi officials, including the head of intelligence, and Egypt’s president, foreign minister, and intelligence chief, further adds to the image that the Gulf States are attempting to stamp their authority on Libya from Egypt.

Links between the HoR and the Gulf have been growing. On 9 September the HoR-backed prime minister (who is opposed by the Tripoli based GNC’s prime minister, Omar al-Hassi), along with the House speaker, Agila Saleh Issa, and the new nominal chief of staff of the army, Major-General Abdulrazzak Nazhuri, were received in Abu Dhabi for an official state visit.

General Nazhuri has also been travelling to Egypt, and on 27 August visited Cairo to meet with the chief of staff, former military intelligence head, and second in command of the Egyptian army, General Mahmoud Hegazy.

But the Gulf states are not united in their support for Libya’s Tobruq-based government. Qatar is accused by the HoR of supporting the Islamist militias fighting against General Khalifa Haftar and of the Muslim Brotherhood in Libya.

Qatar funded the Islamist Tripoli Military Council (TMC), which is partly made up of former members of the Libyan Islamic Fighting Group (LIFG). In addition, the Qatari government has funded and backed the influential Rafallah al-Sahati militia, which has been fighting against General Khalifa Haftar in Benghazi.

Rafallah al-Sahati is currently headed by Mohamad al-Gharabi, a former inmate at the Abu Salim prison, well known as the site of a massacre by the Qadhafi regime in 1996. However the group was previously led by Ismail al-Sallabi, the brother of Qatar-based cleric Ali al-Sallabi, who facilitated Qatar’s 2011 funding of Islamist forces in Libya.

On 6 September a Sudanese military plane was intercepted in Libya, carrying ammunition which the government claims was headed for Islamist forces in Tripoli via Mitiga airport. The Sudanese government is seen as close to Qatar, and Libya has expelled the Sudanese military attache as a result.

As fighting continues, the death toll mounts. According to the independent monitoring group Libya Body Count more than 1,400 people have died violent deaths so far this year. The United Nations believes that 100,000 people have been internally displaced by violence and a further 150,000 have fled the country.

Meanwhile, in the eastern city of Derna, as many as three individuals (one of those an Egyptian national) have been publicly executed in a football stadium by a militant group known as the Shura Council of Islamic Youth.

In addition, in a report on 8 September, Human Rights Watch accused militias fighting in Tripoli of indiscriminate killing. “Militia forces battling for control of Tripoli and surrounding areas have engaged in attacks on civilians and civilian property that in some cases amount to war crimes,” the organisation said.

“Gulf involvement in Libya, while it goes back to 2011, has clearly escalated due to the splits in the state and General Hifter’s campaign,” says Frederic Wehrey, a Senior Associate at the Carnegie Endowment’s Middle East Programme with extensive experience in Libya.

“The Saudi position appears to be in lockstep with the UAE, who have the muscle in Libya and are competing for influence with Qatar by backing the various factions,” he told Middle East Eye.

“Libya is fertile ground for the Gulf to play these games, partly because the oil is valuable, and there’s significant distance from their own territories, but also crucially because of the ability of the UAE and Saudi Arabia to use Egypt and its government right across the border.”

This article was originally published with Middle East Eye on September 14 2014.

Egypt swaps debt for more debt to keep oil companies on side

Egypt’s state-owned oil and gas companies owe more than $6bn to international energy companies that operate its oil and gas fields in the Sinai Peninsula, the Gulf of Suez, Mediterranean, and the eastern and western deserts.

The country’s government has decided that in the interests of maintaining foreign investment and production of its hydrocarbon reserves, it will pay off those debts by borrowing from domestic and international banks

The Egyptian General Petroleum Corporation (EGPC) will “tender for loans from domestic and international banks” in order to pay off some of the debt, Oil Ministry official Hamdy Abdelaziz told This is Africa.

The move is aimed to stimulate foreign investment by energy companies operating in Egypt, thereby boosting production with more research, development, and exploration, according to Mr Abdelaziz.

The Oil Ministry has agreed to pay off all of its remaining dues to the international oil companies by 2017, instead of just the half repayment that it previously promised. Around $1.5bn of the total is to be paid off in September 2015.

Mr Abdelaziz told This is Africa the EGPC has received three offers from local banks that are under consideration, and that international lenders had expressed their willingness but they are “still working on the necessary procedures” for the deal. He would not name the banks involved until negotiations are completed.

Debts to energy companies accrue at a rate of around $200m per month, and the government says the debt currently stands at $6.3bn. The United States Energy Information Administration claims the debt is $7.5bn.

Egypt occupies an important strategic role in international energy markets derived from its operation of the Suez Canal and Suez-Mediterranean pipeline. International energy companies work extensively in Egypt but have recently been reluctant to invest because of the mounting debts they are owed.

The country has struggled to pay its bills to international oil companies because it is diverting ever more of the energy it produces to satisfy domestic demand, leaving less to export. Egypt is the largest consumer of oil and gas in Africa. The government is hoping to reduce some of the demand with phased cuts to energy subsidies that began on 4 July.

Prior to the cuts, Egypt’s subsidy bill accounted for more tha 20 percent of government spending in recent years, at the same time as the country’s tumultuous post-Arab Spring transitions seriously dented growth and foreign investment. Since its peak production of around 900,000 bpd in the mid-1990s, Egypt’s production has fallen steadily even as domestic demand has risen.

Projects on hold

British energy company BG Group spokesperson Kim Blomley confirmed that the company has been developing plans for more investment projects in Egypt, and has signed one non-binding letter of intent with a local partner to examine supplying gas to an Egyptian LNG facility.

However, “release of funds for any further development remain contingent upon a material improvement in the investment climate, including a significant reduction in the outstanding receivable [debt]”, BG Group claimed in a statement.

BG Group is holding discussions with the Egyptian government about the debt, according to Ms Bromley. The company is owed $1.5bn with $1.2bn overdue, she said. If Egypt were to seek to pay off its debt more quickly by borrowing from banks “that would certainly be very welcome”, she said.

British oil major British Petroleum (BP), which has significant operations in Egypt, is also owed money by EGPC – and is likewise looking at plans for expansion. BP would not disclose the total amount it is owed by the Egyptian government.

On 26 June, Egypt’s Oil minister Sherif Ismail claimed that a $10bn BP gas project called West Nile Delta, that had been stalled for three years, had restarted.

However, BP official Robert Wine told This is Africa that “progress is being made on West Nile Delta, but a final deal has not been agreed yet”.

The government has been signing new deals with international firms in order to keep them on side. On 19 June  the state-owned Egyptian Natural Gas Holding Company (EGAS) announced that it had negotiated more attractive terms with German multinational RWE DEA.

And it is not only oil and gas companies that are being courted. Prime Minister Ibrahim Mahleb held a meeting with high value investors on 10 July  to discuss “amicably settling” the large pile of corporate disputes that have accrued between the private sector and the government.

In addition, on July 4 Egypt’s government paid off around $700m of the debt it owes to the Paris Club – an informal international lending group representing the world’s major economies based in Paris. The Egyptian government’s total bill with the Paris Club stood at $3.7bn in December 2013.

“Things may have gotten to a point with the oil companies where production has dropped too much and this just has to be done,” says Michele Dunne, senior associate in the Carnegie Endowment for International Peace’s Middle East Program.

“Inability to pay the international energy companies is a problem that the government will want to take seriously. However, there’s no clear strategy in Egypt at the moment of which this is a part,” she says.

“We see these moves, but there is no transparency and they are coming through piecemeal rather than as part of clear set of policies.”

This article was originally published with FT:This is Africa on August 26 2014.