2ndUPDATE: Libyan Oil Chief:Country's SWF Should Buy Stake In BP

5th Jul 2010 10:05

(Adds BP comment.) DUBAI (Zawya Dow Jones)--Libya should buy a strategic stake in BP PLC (BP.LN) to take advantage of its weak share price following the giant oil spill from one of its wells in the Gulf of Mexico, the country's top oil official told Zawya Dow Jones. Shokri Ghanem, Chairman of Libya's Nation Oil Co. said he will recommend buying a stake in BP to the Libyan Investment Authority, or LIA, the North African state's sovereign wealth fund. "BP is interesting now with the price lower by half and I still have trust in BP, I will recommend it to the LIA," Ghanem said in a telephone interview Monday. "It's a good opportunity for bargain hunters," he added. Ghanem's remarks follow local press speculation that oil-rich Middle East investors are considering a strategic investment in BP as it continues to battle the oil spill in the Gulf of Mexico. The spill, now in its 76th day, ranks among the largest in U.S. history and has hurt the region's fishing and tourism industries. "We are not selling any assets right now but we do wish to sell $10 billion of non-core upstream assets over the next 12 months; if people want to buy BP shares we always welcome new shareholders," said John Pack, a London-based spokesperson for BP. Mohammed Layas, Executive Director of the Libyan Investment Authority, told Zawya Dow Jones Monday he had "no comment at this stage." BP's shares last traded up 2.3% at 329.5 pence. Shares have dropped from as much as 640 pence before the April 20 blast aboard Transocean Ltd.'s (RIG) Deepwater Horizon drilling rig--leased by BP for its Macondo well--in the Gulf of Mexico. "Gulf sovereign wealth funds and other investors from the region might express interest given the record of investing in companies in distress which have brought confidence and placed a 'floor' under the companies' share price and prevented further depreciation," said John Sfakinakis, chief economist at Riyadh-based Banque Saudi Fransi-Credit Agricole. BP said earlier Monday the cost of the response to the oil spill so far is $3.12 billion, as it ramps up oil-containment efforts following storm surges caused by Hurricane Alex. The cost figure includes containment, relief-well drilling, grants to Gulf states, claims paid and federal costs, BP said in a statement. -By Tahani Karrar-Lewsley, Dow Jones Newswires; +9714 446-1692; [email protected] (Summer Said in Riyadh and Selina Williams in London contributed to this report.) Copyright (c) 2010 Dow Jones & Company, Inc. (END) Dow Jones Newswires July 05, 2010 05:05 ET (09:05 GMT)