The first association between UK and Libyan law firms was formed this week in the wake of Prime Minister Tony Blair's visit to Tripoli - and City lawyers are preparing for a rush of interest in the oil-rich territory.

Irene Dallas - a sole practitioner with Reading-based Dallas & Co who has been asked to write the British Chamber of Commerce Web pages on the legal aspects of investment in Libya - signed a deal with Tripoli-based, five-lawyer firm Rajab Bakhnug this week.

She said: 'I have been working with Mr Bakhnug's firm for the past four years.

He deals with a lot of international work but now we've decided to form an exclusive association.'

Ms Dallas welcomed the agreement to bury the hatchet between the prime minister and former pariah Colonel Gadaffi.

She said 'It's a very good thing.

Companies will now start to see deals signed that have been in genesis for three to four years.'

Paul Holland, a partner in the energy department of City firm Denton Wilde Sapte, is visiting Libya on 21 April, and Dentons is organising a seminar on 24 May on political, economic and legal issues affecting the Libyan joint-venture market.

The Libyan ambassador to London will attend.

Mr Holland said: 'Libya is a significant player.

It has been off the radar for the last ten years...

From a trade perspective, the rapprochement is extremely timely, as it's not often that the British lead the way.'

Jeremy Fleming