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UPDATE 4-Blair meets Gaddafi as BP lands energy deal

(Adds Blair-Gaddafi talks start)

SIRTE, Libya, May 29 (Reuters) - British leader Tony Blair held talks with Muammar Gaddafi in a tent in the Libyan desert on Tuesday as BP BP.L sealed a big energy deal with Tripoli in a boost to the West's ties with the once-isolated African state.

Blair, making the second trip of his prime ministership to Libya, arrived in Gaddafi’s home town of Sirte and was then driven 20 minutes into the desert to meet the veteran ruler, in power since he overthrew the monarchy in a 1969 coup.

Blair was also due to meet representatives of families of hundreds of HIV-infected children at the centre of a case in which five Bulgarian nurses and a Palestinian doctor have been sentenced to death by a Libyan court.

In a sign of a developing economic relationship between Britain and Libya, which Blair’s spokesman called “hugely important”, BP negotiated an agreement to explore for natural gas in Libya, according to a Libyan official.

“There is a natural gas exploration deal worth $900 million,” said Shokri Ghanem, head of state-owned National Oil Corporation, adding the deal would be signed later on Tuesday.

The Libya visit marks the start of Blair’s last tour of Africa before he resigns as prime minister on June 27 after a decade in power, handing over to finance minister Gordon Brown.

Blair will also travel to Sierra Leone and South Africa in preparation for a summit of the Group of Eight industrialised countries in Germany next week, when Africa and climate change will top the agenda, and to push for a global free trade deal.

Blair first visited Libya in 2004, sealing Tripoli’s return to the international fold after it abandoned efforts to acquire banned weapons and agreed to pay damages for a 1988 airliner bombing over Scotland.

Gaddafi complained in a BBC interview in March that Libya had not been properly compensated for renouncing nuclear weapons and said that as a result countries like Iran and North Korea would not follow his lead.


Blair’s spokesman said the prime minister would discuss the crisis in Sudan’s Darfur region with Libyan officials.

“Libya has played a useful role in the African Union and has been playing a useful role in regard to Sudan,” the spokesman said. “We will want to hear their assessment of where we are.”

The U.N. Security Council endorsed plans last Friday for an African Union-United Nations peacekeeping force for Darfur, where some 200,000 people have been killed and more than 2 million made homeless since 2003.

Blair has pushed for tough action over Darfur and his spokesman welcomed President George W. Bush’s decision to impose new U.S. sanctions on Sudan over Darfur.

In Sierra Leone, Blair is expected to win praise for sending British troops to the country in 2000 to help shore up the United Nations peacekeeping operation there and hasten the end of a civil war marked by atrocities against civilians.

Sierra Leone has scheduled presidential and legislative elections for July 28, although the poll may be delayed.

In South Africa later this week, Blair is expected to discuss Zimbabwe with President Thabo Mbeki, his spokesman said.

Zimbabwe’s President Robert Mugabe, 83, has vowed to seek another presidential term in 2008, dismissing calls to step down despite his country’s economic crisis, which critics blame on his policies. Mugabe blames former colonial power Britain. (Additional reporting by Adrian Croft in London)