Wednesday, October 11, 2017

Libya Warns Its Oil Recovery is Under Threat
by Anjli Raval, David Sheppard
Financial Times

The head of Libya’s national oil company (NOC) has warned that the country’s recovery in oil output is under threat as it has only received a quarter of its budget from the UN-backed government.

Mustafa Sanalla, the NOC chairman, told reporters in London that a target of 1.25m barrels a day of output was “very uncertain” with current production around 1m.

While that level is around four times higher than early 2016 the recovery is in jeopardy, with damage from earlier fighting still hampering production while political uncertainty in the country has led to a number of shut-ins at fields otherwise capable of producing.

“[We] only have got 25 per cent of the budget required for 2017,” Mr Sanalla said. “We are still suffering.”

Mr Sanalla was speaking after a two-day gathering of more than 40 Libyan and international representatives in Windsor, which produced a draft statement of principles on safeguarding Libya’s oil industry.

The principles are backed by the governor of the central bank in Tripoli as well as international diplomats, tribal and regional representatives, and representatives of international oil companies active in the country.

Included in the principles were that the NOC should retain a “monopoly” over controlling oil exploration and production deals and that no “concessions or payments” should be made to groups that attempt to blockade or disrupt production.

Six years on from Libya’s counter-revolutionary Pentagon-NATO engineered war the NOC is one of the few functioning parts of Libyan society. Mr Sanalla has pushed to make it a cornerstone of the country’s return to stability.

He warned that at the key oil ports of El Sider 12 out of 19 tanks were still out of operation while at Ras Lanuf half were still damaged after fighting.

“Keeping sustained production is in the interest of everyone and will be well respected by everybody,” Mr Sanalla said. “If we do not have enough investment, production will decline.”

No comments: