Libya's National Oil Corporation (NOC) will sign offshore gas exploration and production deals with Italy's Eni on Saturday, NOC head Farhat Bengdara told a television channel.
The deal would require $8 billion to produce up to 850 million cubic feet a day of gas from the Mediterranean, Bengdara said, amid efforts by Libya to take advantage of demand for North African gas in Europe because of the war in Ukraine.
Bengdara was speaking to local al-Masar television in an interview broadcast late on Tuesday and said the deal involved the renewal of an existing agreement originally struck in 2008. Eni Chief Executive Claudio Descalzi could travel to Libya to sign the agreement, an Italian source said.
However, the legality of any deals signed by Bengdara or the Government of National Unity in Tripoli that appointed him could be challenged by the country's eastern-based parliament.
The parliament said last year that the Tripoli government's mandate had expired, and it no longer recognizes any of its actions - including the appointment of Bengdara - as legitimate.
The standoff between factions aligned with the government and those aligned with the parliament has thwarted efforts to move towards a new general election and threatened to spark a new bout of warfare.
Meanwhile, the government's own efforts to strike a bilateral energy deal with Turkey have also been suspended by the country's appeals court, raising further questions over the exploitation of Libyan energy.
(Reuters - Reporting by Ayman al-Warfali, additional reporting by Francesca Landini in Rome, writing by Angus McDowall; Editing by Kirsten Donovan)