Britain agreed to include Lockerbie bomber Abdel Basset al-Megrahi in a prisoner transfer deal with Libya because of "overwhelming interests" shortly before an oil deal was sealed with Tripoli, a newspaper reported on Sunday.
The Sunday Times said leaked letters from Justice Secretary Jack Straw undermined government denials of a link between the former Libyan agent's freedom and British trade interests.
Megrahi, 57, was released from jail on August 20 after Scottish authorities said his terminal cancer gave compassionate grounds for him to return home to die.
The release of the only person convicted of the 1988 bombing of Pan Am flight 103 over the Scottish town of Lockerbie that killed 270 people, and his rapturous reception in Tripoli, has angered the United States government, which lost 189 citizens.
Reversed original plan
The Sunday Times said two letters from Straw, dated five months apart, showed he reversed an original plan to exclude Megrahi from a prisoner transfer agreement that was being discussed with Libya.
The paper said the change of heart appeared to be linked to a stalled $900 million oil and gas exploration deal with Libya for British oil giant BP that was ratified a few weeks later.
BP has always denied any link between the deal and the prisoner agreement.
Straw wrote to Scottish Justice Secretary Kenny MacAskill in July 2007 to say he favored excluding Megrahi from the prisoner transfer, an arrangement desired by the Scottish administration which has autonomous powers over most criminal matters.
But by December 2007 he told MacAskill his position had changed.
"The wider negotiations with the Libyans are reaching a critical stage and, in view of the overwhelming interests for the United Kingdom, I have agreed that in this instance the (prisoner transfer agreement) should be in the standard form and not mention any individual," the Sunday Times quoted Straw as writing.
Cabinet minister John Denham told Sky News it was "perfectly clear" there was no link between Megrahi and any trade deals, given that Scotland eventually released him on compassionate grounds and not under the transfer agreement.
The negotiations on prisoner transfers had been part of the "broader normalization of relations with Libya," he said.
More on: Lockerbie
