A newly leaked U.S. diplomatic note says Libya threatened to nationalize Petro-Canada's operations in the North African country over a spat with the Canadian government.

It's the latest revelation in a bizarre international saga that first grabbed headlines two years ago.

Libyan leader Moammar Gadhafi cancelled a late September 2009 stopover in Newfoundland after Canada promised a tongue-lashing for the hero's welcome Libya extended to a man convicted in the Lockerbie bombing.

The U.S. cable, obtained from WikiLeaks by British newspaper the Daily Telegraph, says Libya's state oil company called in a senior Petro-Canada official with a threat to nationalize the firm's operations in Libya if Canada did not apologize.

It also says Sandra McCardell, Canada's ambassador to Libya, told her American counterpart that Ottawa had initially planned to refuse Gadhafi permission to visit.

However, Canadian companies with business interests in Libya "launched a furious lobbying effort" and persuaded Prime Minister Stephen Harper's government to allow the trip to go forward.