The Sentry
Failures in project management
Beyond administrative irregularities, the Derna dam project was marked by an unusual and corruption-prone configuration of partners. In July 2009, the GWA contracted El Concorde, a Jordanian firm, to participate in the Derna dam project. The task for which El Concorde was recruited had in July 2007 been declared completed by an ODAC-affiliated enterprise called Benaa wa Tashyeed.
The hiring of another company for the same task two years later indicates that Libya’s Benaa wa Tashyeed had failed to do the work and that Arsel could not complete it.
El Concorde received its upfront payment but initiated no work, likely because Arsel did not complete its own earlier phases, preventing El Concorde’s work from commencing.
In response to The Sentry’s questions, a senior Benaa wa Tashyeed official declined to comment on the Derna dams but acknowledged the enterprise’s general lack of capabilities.
For large infrastructure projects, a consultancy is typically hired at the outset to validate contractors’ milestones throughout. For Derna’s dams, however, this crucial step was delayed until 2010, when the GWA hired Italian consultancy IRD. This delay suggests that the relevant Libyan decision-makers had been in a rush to funnel the upfront payment to Arsel before even making sure that all the necessary components for physical implementation were in place.
Such behavior often goes hand in hand with corruption.
Derna post-2011
Throughout the course of the Derna dam project, GWA officials demonstrated a notable lack of follow-through, as well as a remarkable leniency towards Arsel’s nonperformance. This behavior only continued in the years following 2011, adding to the likelihood that the initial assignment was tainted by corruption.
After Qadhafi’s fall, the newly established government in Tripoli introduced a policy meant to encourage foreign companies to return and resume their pre-2011 projects.
In response, Arsel personnel returned to al-Marj and Benghazi, likely motivated by the prospect of receiving at least half the payment from a round of invoices issued and approved just before the 2011 uprisings. But the Turkish company never returned to its Derna sites. Arsel did, however, voice grievances over not receiving the funds it was due at the start of 2011 for the Derna work scheduled to occur in 2010.
After years of bureaucratic back-and-forth, the GWA—now called the Water Resources Ministry—disbursed the payment, but it notably did not request that Arsel return to Derna and complete the job for which it was paid. Nor did the GWA attempt to get its money back when it became clear that almost no work had been carried out.64, 65 The GWA, now called the Ministry of Water Resources, did not respond to a request for comment.
During that same post-2011 period, ODAC directly contracted another Turkish company, Karan Grup, to perform excavation work as part of the rehabilitation of the Derna dams. Like Arsel before it, Karan did almost nothing.
The small Turkish company also had direct ties to its predecessor: Before 2011, Karan Grup’s leader, Sertac Karan, had held an executive role within Arsel, focusing on projects in the greater Benghazi area.
After 2011, he worked for various other Turkish companies in Libya, including his own. Karan Grup participated in several projects funded by ODAC, including the Derna assignment from 2012 to 2016. A former Karan Grup employee indicated to The Sentry that, during that period, Sertac Karan maintained connections with the Dabaibas, even though they were no longer officially at the helm of ODAC. Karan Grup did not respond to a request for comment.
In 2017, Arsel—whose fiscal health was weakened—filed for bankruptcy, leaving its creditors in pursuit of any remaining assets. Later, in the wake of the dams’ September 2023 collapse, information began to surface that Arsel’s failure to perform maintenance work on the dams had contributed to the tragedy.
In an attempt to change the narrative, the Dabaiba government helped promote the idea that proper and legitimate work by Arsel in Derna was interrupted by the February 2011 uprisings. The evidence, however, suggests otherwise.
ODAC Under the Dabaibas
Arsel’s compromised conduct in Derna was not isolated. It reflected a wider problem that was the hallmark of ODAC in the 2000s. With Ali al-Dabaiba at its helm from 1989 until 2011, ODAC employed questionable practices that subverted and impeded the completion of projects across Libya.
To put the situation with Arsel in Derna in perspective, it is essential to step back and examine ODAC’s broader operational context under the Dabaibas. As early as 1998, Ali al-Dabaiba implemented strategies that shielded his organization from the significant payment delays that characterized Qadhafi’s arcane bureaucracy.
By achieving greater financial independence from other parts of the state, Ali al-Dabaiba ensured that ODAC could issue payments fast, without interference from Qadhafi’s revolutionary committees and other cumbersome controls.
This differentiating trait contributed to rendering ODAC particularly attractive to foreign companies, especially from Turkey. Moreover, ODAC was notorious for its opacity.80 Ali al-Dabaiba’s power system rested on a foundation of familial ties, with his tightknit clan wielding influence across various parts of the Libyan state apparatus, beyond just ODAC.
In his capacity as ODAC chief, Ali was often assisted by his sons, Usama and Ibrahim, and his brother Youssef. Ibrahim became particularly assertive starting in 2006. That same year, Ali’s cousin Abdelhamid took the helm of the Libyan Investment and Development Holding Company (LIDCO), a real-estate vehicle through which billions of public dollars flowed.
LIDCO served three main state clients: ODAC, the Housing and Infrastructure Board, and the Civil Aviation Authority. Thus, during the regime’s last half-decade, the two cousins did business together, often without any oversight. LIDCO did not respond to a request for comment.
Also in 2006, Benaa wa Tashyeed, a state-owned construction enterprise established by Qadhafi’s regime the previous year, fell under ODAC’s control, becoming an extension of the Dabaiba family’s influence. For many of its projects, ODAC required that foreign firms—including Arsel, on several non-Derna projects contracted between 2007 and 2010—partner with Benaa wa Tashyeed in joint ventures.
From a governance perspective, the configuration posed a significant problem. Both the Libyan client (ODAC) and the Libyan contractor (Benaa wa Tashyeed) operated under the sway of the same family—a clear conflict of interest that undermined the principles of checks and balances, damaging project integrity and undercutting public interest. Suspicions of impropriety were further fueled by the absence of evidence that Benaa wa Tashyeed ever possessed the capabilities necessary to fulfill its high-profile mandates in these joint ventures. In response to The Sentry’s questions, a senior Benaa wa Tashyeed official indicated that from 2006 to 2010, projects were awarded to Benaa wa Tashyeed in a centralized manner based on favoritism, without regard for the company’s capabilities.
The official noted that this practice undermined project completion and added that Benaa wa Tashyeed’s weak finances prevented timely payments and limited its ability to attract qualified personnel. The period from 2005 to 2010, while all this was happening, was also one of the most financially prosperous in Libya’s history.
The December 2003 agreement between the US and the Qadhafi regime led to the removal of international sanctions, which—in conjunction with then-rising oil prices— brought about a surge in national prosperity.
Soon afterward, hundreds of foreign companies flocked to Libya. By the time of the February 2011 insurgency, the Qadhafi regime was overseeing more than $70 billion in ongoing projects, including more than $15 billion in contracts awarded to 200 Turkish firms active in 100 different locations across Libya.
In eastern Libya, in the cities of Tobruk, Benghazi, and Derna, 28 Turkish companies were said to be working on projects with a combined value of $3 billion. ODAC and LIDCO were the most prolific in handing out new contracts, with other active spenders including the Housing and Infrastructure Board and the Highways Authority. But despite these impressive figures, many of the projects did not actually proceed as planned once the paperwork was signed.
As the number of projects swelled, a change occurred: The pace of many Turkish construction projects in Libya became more laborious—if they got off the ground at all. The pronounced slowdown coincided with the rise in Dabaiba-linked corruption, which reached levels so severe that it hampered the implementation of construction projects.
Five former Libyan officials and a Turkish corruption expert told The Sentry that Ali al-Dabaiba and his relatives routinely demanded more than 15% in kickbacks as they negotiated infrastructure projects, especially during the years leading up to the 2011 uprisings.
The diversion of project funds into these bribes severely strained foreign contractors’ profit margins and operational budgets, often resulting in poor execution, delays, and long halts, despite timely payments from the Libyan state. Some companies responded by borrowing money, minimizing expenditures, progressing slowly on projects, and then, after years of delay, requesting additional funds from the Libyan state.
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