Page 5 - AfrOil Week 43

AfrOil COMMENTARY AfrOil

According to Stephanie Williams, the UN’s Act- reaching 560,000 bpd on October 21, a source
ing Special Representative for Libya, the deal with knowledge of the matter told Bloomberg
clears one of the remaining obstacles facing the last week.
country’s oil industry – namely, the presence of
foreign troops at oilfields, tank farms and other Full recovery in sight?
infrastructure facilities. The agreement provides According to NOC, yields are on track to keep
for all such troops to leave Libya within three rising.
months, she told reporters in Geneva on Octo- This is partly due to the re-opening of the Ras
ber 23. As a result, she said, there are “good indi- Lanuf and Es Sider terminals, but it also stems
cations that the oil installations of Ras Lanuf and from the resumption of production at additional
Es Sider will be ready to resume [operations] in sites. For example, NOC reported in a statement
the near future, in a very short period of time.” on October 26 that it had been able to lift force
Williams’ optimism was not misplaced. She majeure at El Feel, the last major oilfield that had
was speaking on the same day that NOC said it remained offline. It said the site was on track to
had lifted force majeure on the Ras Lanuf and bring yields back up to 70,000 bpd within just a
Es Sider terminals, bringing the number of fully few days and “[declared] the end of the block-
operational export facilities on the Mediterra- ades at all Libyan fields and ports.” “
nean coast up to five. (Brega, Marsa el-Hariga Meanwhile, progress is being made on other Libya may be
and Zueitina were all cleared of foreign troops fronts. In its statement on the re-opening of Ras
in the second half of September.) Lanuf and Es Sider, NOC said: “[As] production less than a
resumes at the Waha and Harouge fields, pro-
Economic fallout duction levels will reach 800,000 bpd within two month away from
All five of these terminals – along with the rest of weeks and will exceed 1mn bpd in four weeks.” restoring crude
Libya’s oil infrastructure, including production If the company’s forecasts are accurate, Libya
systems, pipelines, refineries and storage depots is less than a month away from restoring output oil output to
– had slowed or halted operations following an to year-ago levels. It may even be able to sustain
LNA offensive in January. As a result, the coun- this success if it can show that it has assuaged year-ago levels
try’s crude production plummeted from about LNA’s long-standing claims that authorities in
900,000 bpd to less than 100,000 bpd in just a Tripoli do not provide the eastern and southern
few months. parts of Libya with a fair share of the country’s
The slump has wreaked havoc. Oil exports oil income.
are Libya’s main source of revenue, and central So far, it is not clear whether or to what
bank officials noted in mid-September that the extent these concerns have been addressed. As
country had racked up at least $9bn in lost reve- of press time, the UN and the Libyan factions
nues as a result of the production stoppages. At had not yet divulged all the details of the cease-
the same time, the blockade has increased the fire agreement.
government’s deficit spending by disrupting Williams did tell reporters in Geneva,
domestic fuel shipments and making imports though, that the parties had agreed to take
necessary. steps that would re-establish national control
As such, LNA’s agreement to suspend the over key institutions, including NOC and the
blockade came as a great relief to NOC. The central bank. The former is based in Tripoli but
company and its subsidiaries succeeded in has worked to remain neutral in the conflict
bringing crude production back up to 500,000 between GNA and LNA; it has been depositing
bpd as of mid-October. Output levels then oil revenues in the latter for distribution among
climbed even higher over the following week, the regions. ™

Week 43 28•October•2020 www. NEWSBASE .com P5