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AfrOil COMMENTARY AfrOil

Sharara is capable of producing 300,000 bpd of oil (Photo: Alwasat.ly)

Libya’s precarious position

The country’s oil infrastructure is coming back on stream, but it may face another blockade soon

CONDITIONS in Libya’s oil sector, which has Sharara, would be to deliver crude to the Zaw-
languished in the wake of fighting between rival iya refinery. The 120,000 bpd plant has suffered
WHAT: political and military factions, have continued severe shortages of feedstock in recent months
NOC is optimistic about to improve over the last week. Production lev- but has already begun receiving oil from several
its chances of pushing els reportedly reached 355,000 barrels per day of the fields that have come back on stream since
production back up above (bpd) on October 11 and are now poised to go mid-September.
1mn bpd. even higher following the restart of Sharara, the
country’s largest single source of crude. Higher and higher
WHY: Libya’s National Oil Corp. (NOC) confirmed As noted above, the revival of development
The lifting of the blockade the resumption of commercial operations at operations at Sharara is good news for Libya. It
that kept oilfields, Sharara on October 11, saying in a statement also stands to benefit NOC, which is reportedly
pipelines, refineries and
terminals idle for months that it had lifted the declaration of force majeure looking to raise oil output back to the 2019 aver-
was not a permanent on the field. age of 1.2mn bpd.
measure. NOC did not say how quickly Sharara might Additionally, it seems to have encouraged
be able to push output back up to 300,000 bpd, Sadiq el-Kabir, the head of the country’s central
WHAT NEXT: the average level prevailing before the imposi- bank, who said last week that he hoped to see
Unless progress is made tion of a blockade in January. However, an anon- yields go even higher. According to el-Kabir,
on revenue-sharing ymous source told Reuters earlier this week that Libya ought to bring production up to 1.7mn
policy, LNA may put the the field was coming back online at an initial rate bpd as soon as possible so that it can cover all
blockade back in place of 40,000 bpd. of its expenses.
within days. The source also said that the first priority It remains to be seen, though, whether that
for Akakus, the NOC subsidiary that operates goal is actually within reach.

P4 www. NEWSBASE .com Week 41 14•October•2020