Libya has signaled its intention to restart its oil output. The country’s National Oil Corp. (NOC) said Tuesday that it is already in talks with regional countries and the Government of National Accord under the supervision of the UN.
S&P Global Platts yesterday quoted an unnamed spokesman at NOC confirming that the organisation has been conducting ongoing negotiations with international parties over the past several weeks and is determined that it will forge a transparent agreement. “We are hopeful that those regional countries will lift the blockade and allow us to resume our work for the benefit of all the Libyan people,” the spokesperson said.
Libyan crude production is said to be currently as low as 70,000-80,000 b/d, less than a tenth of levels before January 18, when an oil port blockade began thwarting the country’s crude output.
“The corporation also optimistic that the agreement will include solutions to protect the oil facilities and make sure they are never used as a military target or a political bargaining chip again,” the spokesperson added.
The civil conflict between the UN-backed GNA and the self-styled Libyan National Army escalated in recent months, with Libya’s oil and gas facilities caught up in the dispute. The GNA has recently gained ground against the LNA led by Khalifa Haftar, which has halted the latter’s offensive into Tripoli. The GNA has been striving to move eastward toward the oil-rich Sirte Basin into the eastern stronghold of the LNA.
Platts quoted Hamish Kinnear, a MENA analyst at Verisk Maplecroft, saying both sides would be keen for a deal as it would help them avoid more military confrontation. “The deal makes sense, as LNA/Haftar allowing the reopening of ports – and appearing magnanimous in the process – would allow it to avoid a potentially disastrous military confrontation with the GNA/Turkey where it could very well lose the oil crescent,” he said.
“A GNA/Turkish offensive on Sirte/Jufra is looking like an increasingly complicated prospect now that the Russian mercenaries are more entrenched with the threat of Egyptian military intervention,” Kinnear said.
Platts report asserted that last week, the chairman of NOC, Mustafa Sanalla, acknowledged that many countries were benefiting from the absence of Libyan oil from global markets, accusing them of preventing the North African producer from restarting production.
Sanalla also said he was deeply concerned by the presence of Russian and other foreign mercenaries, who had recently entered the 300,000 b/d Sharara field to meet with the petroleum facilities guards. Libya’s civil war has recently resembled more of a proxy war, with many foreign countries involved.
The GNA is backed by Turkey and Qatar while the LNA is supported by Russia, Egypt, the UAE and Saudi Arabia.
Chibisi Ohakah, Abuja
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