By Deepa Babington and Alexander DziadoszLibya | Wed May 11, 2011 4:55pm IST
(Reuters) - One day last month Wahid Bugaighis arrived at the offices of eastern Libya's main oil company with big plans to turn it into a major source of funds for the struggling rebel movement.
But things did not go as smoothly as the freshly appointed rebel oil boss might have hoped.
After he announced a management reshuffle at Agoco, the company which runs some of Libya's most important oilfields, disaffected staff promptly held a meeting and voted to reject the changes.
"It's the wrong time, it's the wrong guy, everything is wrong," an Agoco manager told Reuters. "The people didn't accept this and they kicked him out. He can't come here now to Agoco."
The episode was just one example of the kind of disharmony that has emerged among Libya's rebels in the east in the three months since they threw off decades of authoritarian government under Muammar Gaddafi.
Divisions among the rebel leaders are blunting their challenge to Gaddafi and could unnerve foreign powers banking on them as a credible alternative government for the war-riven country.
Public relations gaffes, foot-dragging on naming officials and confusion over who controls crucial policy areas have led some observers to wonder if the rebels can stay united after their hopes for a quick overthrow of Gaddafi were dashed.
"When things are not going well, people start to quarrel," said David Hartwell, IHS Jane's North Africa and Middle East analyst. "It's not surprising given the fairly disparate nature of the opposition."
The goal of overthrowing Gaddafi brought together an unlikely cabal of U.S.-educated businessmen, a woman dentist, tribal elders, left-wing university professors and former Gaddafi apparatchiks in the rebel stronghold of Benghazi.
They have proved they can manage public services and keep the rebellion afloat by lobbying for loans and foreign help selling Libyan oil, but cracks have appeared as their military campaign bogs down.
WHO RUNS THE SHOW?
Bugaighis, who was head of Gaddafi's National Oil Corporation in the 1980s, still gives interviews as the head of the rebel national oil company, despite the challenges to his authority.
"We don't need an oil minister now," said the Agoco manager, who requested anonymity. "If we deal directly with the national council, why do we put other guys in the middle?"
Some rebel leaders are sticking by Bugaighis, citing his experience and contacts among potential buyers of Libyan oil.
Rebel attempts to turn a rabble of ill-equipped volunteer fighters into a Libyan army that can win and hold territory have been overshadowed by confusion over who is running the show.
The national council says Abdel Fattah Younes, Gaddafi's former interior minister who defected early in the rebellion, is leading the military campaign.
Younes lacks the trust of some in the rebel leadership and one rebel spokesman, Colonel Ahmed Bani, told Reuters in March that Khalifa Heftar was the true army leader.
Heftar is a former military commander who supported the 1969 coup that brought Gaddafi to power and became a member of Gaddafi's policy-making Revolutionary Command Council before breaking with him in 1987.
Heftar, who has lived for the past 20 years in the United States, has insisted that Younes is an officer serving the rebel army in a support and logistical role.
Asked on May 4 to clarify the situation, Bani told Reuters: "All fighters on the ground are responsible for the liberation of Libya, without having to mention any particular names."
"I have yet to see evidence that the division in military command has been resolved," said Shashank Joshi, an analysts at the Royal United Services Institute in London.
"Politically, it is dangerous to have divided military command, since it lays the ground for warlordism," he said.
The conflicts reflect a dilemma -- where do you find competent, experienced officials who know Libya but are not so tainted by association with Gaddafi that the people reject them?
"What you have is a strange mix of bona fide revolutionaries who stood up to Gaddafi in the early days mixing with defectors from Gaddafi's regime who had their own plans for holding on to power," said political risk consultant Geoff Porter.
"That would seem to be a pretty potent brew and does not bode well for success."
At an international meeting on Libya at the end of March, U.S. Secretary of State Hillary Clinton described efforts to find out more about the rebel leadership as a "work in progress".
The confusion is compounded by chaotic and conflicting announcements by the rebel leadership.
When Mahmoud Shammam, in charge of media and information affairs, told reporters in Rome that Spain, the Netherlands and Denmark had recognised the rebel national council as Libya's legitimate representative, those countries quickly denied it.
The official rebel spokesman in Libya, Abdel Hafiz Ghoga, said only he had the right to speak about such matters, then announced proudly that Italy, which has recognised the rebel council, had agreed to supply it with weapons.
Italy's government said that was not true.
The splits and mixed messages have left some Libya experts wondering how the rebels will forge a viable government with a set of policies if Gaddafi falls, achieving the one goal that united them.
None say the problems are bad enough to make western states question their military and financial backing for the rebels.
"If they withdraw support and leave eastern Libyan to its own devices, that would be a major policy failure," said Hartwell. "For the credibility of the U.N. and all others involved, that cannot be allowed to happen."
Disagreements and false starts might be unavoidable as the rebel leadership tries to weld so many disparate forces into a legitimate future government.
For reporters in the eastern rebel stronghold of Benghazi, frustration at mixed messages from the rebels -- and constant changes in the venues for press conferences -- combines with admiration that the whole system stays afloat, buoyed by the euphoria of self-rule after decades of oppression by Gaddafi.
A Western diplomatic source played down the divisions and said the rebels had made it clear that Younes, not Heftar, was in charge of the army.
But he said that, for now, foreign governments were still relying only on verbal assurances from the rebels, not formal decrees, to know who was in charge of what.
"It will be very important that the Council make formal nominations of positions in the future," the source said.
(Writing by Tom Pfeiffer; Editing by Giles Elgood)