Page 5 - AfrOil Week 02 2022

AfrOil COMMENTARY AfrOil

Despite these occasional upsets, though, Platts somewhat as of January 11, with Reuters saying
has estimated that Libya extracted about 1.11mn that the Sharara and El Feel sites had resumed
bpd of oil on average in 2021. This is more than production after PFG members stopped strik-
three times the 2020 average of 360,000 bpd and ing. However, exports have been down this
is even 5.7% above the figure of 1.05mn bpd week, as harsh weather has kept most of Libya’s
reported for the full year of 2019, before LNA coastal export terminals – not just Zawiya and
launched a large-scale campaign against GNA Mellitah, where the strikes are a consideration,
that caused production rates to plummet. but also Zueitina, Ras Lanuf, Hariga and Es Sider
The question now is whether Libya can con- – out of service since January 8.
solidate its gains and perhaps gain even more
ground this year. Officials in Tripoli would prob- Different players on the board
ably like to think so, but NewsBase suspects that In theory, if the presidential elections had
the answer is far less straightforward. There are been held, Libya might be on the way towards
at least two reasons for this. establishing the legal and governmental struc-
tures needed to address labour complaints in a
Different political outlook more orderly fashion. But since they were not
First, Libya’s political scene is significantly dif- (and could not, according to the election com-
ferent today. mission) proceed as planned on December 24,
At the beginning of 2021, the North African Libya will have to continue with what it has for
state’s oil industry was operating on the assump- the time being.
tion that GNA, LNA and other parties to the In other words, PFG will remain a factor in
permanent ceasefire agreement that established the oil industry. It will continue to have the abil-
the Government of National Unity (GNU) were ity to disrupt oil and gas operations – and it may
heading for elections. That is, it was expecting exercise that ability more frequently if the wait
that Libyan voters would be able to go to the for the election stretches on too long and pay-
polls as scheduled on December 24 and choose ments to workers become irregular. There may very
a new president, meaning that there would be an But the other players in the sector will also
end to the transition period. remain active. On the one hand, there is Mustafa well be more
It may also, then, have been anticipating a Sanalla, the long-serving chairman of National
time when oil and gas production, transporta- Oil Corp. (NOC), who has done an admirable occasions for
tion, processing, storage and export operations job of maintaining his company’s neutrality and
could simply proceed in something resembling ties to all factions. On the other hand, there is Oil conflict between
a normal fashion. If so, its hopes were left unre- Minister Mohammed Oun, appointed by GNU Sanalla and Oun
alised. Amidst a slew of legal disputes that pre- to head the recreated ministry in March 2021.
vented officials from finalising the candidate list, Oun has feuded with Sanalla, complaining that while Libya waits
the national election commission announced on he has arrogated power that ought to belong to
December 22 that it was postponing the presi- the Oil Ministry, and has tried to fire him twice. for the vote to be
dential vote indefinitely. Thus far, Sanalla has survived, and he appears
This move led some observers to predict a to have the backing of Prime Minister Abdul rescheduled
rapid resurgence of conflict between factions. Hamid Dbeibah, the head of GNU. However,
So far, these forecasts have proved inaccurate, Oun also has his supporters, and The Africa
and there has been no widespread civil unrest. Report commented earlier this week that the
But the oil sector has not returned to normal prime minister appears to be acting as a medi-
either. The election commission’s announce- ator between the two men in order to maintain
ment on the postponement of the elections came control over NOC and its revenue stream.
two days after units of the Petroleum Facilities As such, there may very well be more occa-
Guards (PFG), a group that has played a key role sions for conflict between Sanalla and the min-
in previous disruptive labour actions, shut down ister while Libya waits for the presidential vote
four of the country’s largest oilfields (Wafa, Sha- to be rescheduled. If so, they may occur against
rara, Hamada and El Feel), along with the Zaw- a backdrop of increased restlessness among the
iya and Mellitah coastal export terminals. Once country’s oil workers (and PFG units).
again, PFG cited overdue salary payments as the At the same time, there will be more political
cause of the strike. uncertainty than there was a year ago, since no
The group continued the blockades for sev- one knows yet when the election might happen.
eral weeks, reportedly reducing Libyan oil out- As such, Libya’s oil sector will be working in
put by about 300,000 bpd to less than 900,000 2022 to rebuild and consolidate its gains against
bpd. Conditions had reportedly improved steeper odds than it did last year. ™

Tank farm at Ras Lanuf (Image: NOC)

Week 02 12•January•2022 www. NEWSBASE .com P5