Page 13 - AfrOil Week 23

AfrOil PERFORMANCE AfrOil

Both fields have been idle since mid-January, declaration of force majeure on the two fields.
when a blockade mounted by Khalifa Haftar’s As of June 9, though, NOC has declared force
Libyan National Army (LNA) shut down much majeure on operations at Sharara once again.
of the country’s petroleum industry and began This move could affect plans for Libya to restart
a process that dragged crude output levels down oil exports, which have remained on hold for
by more than 800,000 bpd. The blockade lasted several months.
for 142 days and caused Libya to incur nearly It could also have a negative impact on efforts
$5.27bn worth of losses, NOC reported. to resume crude shipments to the Az-Zawiya
The company had hoped to use the two oil- refinery. Sanalla had said on June 8 that the
fields to bring production levels back up. It will plant was once again receiving feedstock and
not be able to reach full capacity immediately, would “resume its operations to produce fuel
though, owing to the damage the sites sustained for domestic use.” He added: “This will reduce
during the shutdown. Together, the fields are pressure on the budget allocated to import fuel.”
capable of turning out around 390,000 barrels Both El-Feel and Sharara are located in a sec-
per day (bpd) of oil. tion of south-western Libya that was seized by
But on June 9, NOC said that armed troops LNA forces in January. In recent weeks, though,
under the command of Mohamed Khalifa, the the Tripoli-based Government of National
head of a group known as the Petroleum Facil- Accord (GNA) has regained control over the
ities Guard (PFG), had stormed the Sharara territory. Its successes could set the stage for
field. The troops forced civilian workers at the NOC to restore production, which stood at
site to halt production, thereby committing “a more than 900,000 bpd as of the beginning of
serious crime that amounts to treachery against the year.
the Libyan people and the national economy,” Such an outcome would be good for Libya,
it said. but it could also create problems for the OPEC+
“The shutdown of production will cost group.
the treasury further losses and will lead to OPEC and its allies recently agreed to extend
new technical damages,” it added. “NOC also production limits by another month, until the
expresses its concern about the breach by this end of July, in the hope of pushing oil prices up.
armed group of the strict coronavirus [COVID- Their efforts might falter if large volumes of Lib-
19] pandemic control programme followed in yan crude start to enter the market. ™
all the facilities of the corporation and considers
their entry into the field in this way to be a seri-
ous threat to the health of workers.”
NOC had said on June 8 that Sharara had
resumed production at the rate of 30,000 bpd
and would reach full capacity within 90 days. It
is not yet clear whether the company still hopes
to meet this deadline.Nevertheless, El-Feel has
reportedly begun producing again at the rate
of 12,000 bpd and is due to reach full capacity
within 14 days.
NOC chairman Mustafa Sanalla stated
on June 8 that his company had lifted its NOC has declared force majeure on operations at Sharara (Photo: File)

Nigeria comments on compliance

with OPEC+ production quotas

NIGERIA NIGERIA has conceded that it did not imple- State for Petroleum Resources, said that the
ment all the production cuts stipulated in a country had only made 52% of the promised
previous OPEC+ group agreement, but its gov- cuts, bringing production down from 1.829mn
ernment has also pledged to comply with the bpd to 1.613mn bpd in May.
limits imposed under the new accord that was Sylva also claimed that Nigeria had taken
struck over the weekend. steps to ensure compliance. Production levels
The West African state had been due to bring stood at 1.412mn bpd in early June and are set
output levels down to 1.412mn barrels per day to remain at this level, he said.
(bpd) in May and June, in line with the provi- Mele Kyari, the group managing director of
sions of the OPEC+ deal signed in April. Last Nigerian National Petroleum Corp. (CNPC),
week, though, Timipre Sylva, the Minister of struck an even more upbeat note.

Week 23 10•June•2020 www. NEWSBASE .com P13