By John Hamilton.
London, 12 August 2013:
July was a disastrous month for Libyan oil production as output fell
below 400,000 b/d due to strikes at some of the major export terminals.
The authorities hope to resolve some of the complaints motivating the
blockades after the Eid Al-Fitr holiday marking the end of Ramadan.
However, officials are not yet confident of regaining full control and,
for the foreseeable future, the outlook is one of continued disruption.
One day before the start of Eid, Deputy Oil and Gas Minister Omar
Shakmak said that he expected protests at the Sidra and Ras Lanuf
terminals to be lifted first. Speaking to the industry newsletter
African Energy,
he said “I don’t have details yet, but hopefully these two terminals
will resume operations”. However, international media reported on 8
August that the Es Sider crude stream which is exported from the
terminal had “collapsed” due to a strike at the terminal.
The Wall Street Journal
said that production from Waha Oil Company –normally amounting to about
300,000 b/d, had ceased as storage at the terminal was full. Sidra has
19 storage tanks with total capacity of 6.2m bbls. Waha is owned by
National Oil Corporation (NOC) and a trio of US companies: Hess,
ConocoPhillips and Marathon Oil. According to one industry analyst, a
lack of confidence in Waha’s ability to produce reliably, thanks to
strikes, may have motivated Marathon’s unconfirmed intention to sell its
stake in the joint venture.
Other companies which export from Sidra include Total’s Mabrouk Oil Operations and Wintershall. The
Libya Herald
understands that neither company has problems at its fields, but they
are being affected by the closure of the terminals. A strike at the Ras
Lanuf terminal has also shut in 200-300,000 b/d of production from
fields operated by Arabian Gulf Oil Company (Agoco), Wintershall and the
NOC-Suncor joint venture, Harouge Oil Operations.
A third debilitating strike has interrupted production from companies
which export via the Zueitina terminal. These include Zueitina Oil
company which is part owned by Occidental Petroleum, and Mellitah Oil
and Gas (MOG), a joint venture with Italy’s Eni. According to one
industry source, production from MOG’s 100,000-b/d Bu Attifel field is
currently shut in. Shakmak said that resolving the blockade at Zueitina –
which has lasted longer than any other – “will need some more time”.
The problem facing authorities here, according to a Libyan political
analyst, is that the protest is not only about wage levels and
employment, but is also a way of activists demonstrating autonomous
control over energy production in the east of Libya. He said that
political groups pushing for federalism in Cyrenaica had an incentive to
block exports to gain leverage in constitutional negotiations. If true,
more disruption is therefore almost certain.
Other terminals have witnessed blockades at various times over the
past several months. As with the current shut-ins, they were caused by
armed groups supposedly responsible for providing security at the sites.
In March, a fire-fight between Zintan and Zuwara armed groups shut the
Mellitah gas complex near the Tunisian border for eight days. The Marsa
Al-Herigah terminal in Tobruk was closed by members of Petroleum
Facilities Guard in early August. On 7 August, Shakmak described the
situation there as “not 100 percent under control”, saying he hoped it
would be by the date of next shipment from the port, scheduled for 10
August. In the week running up to Eid, the government sent out
delegations with cash to pay protestors at the terminals. However, this
approach of paying off the guards did not appear to have taken affect
before the start of the holiday.
Output from Marsa Al-Herigah is also being affected by major problems
at Agoco, which operates the large Sarir and Messla fields located
about 400 kilometres south of Benghazi. Union officials at the company
have threatened to progressively cut production unless the company was
allowed more autonomy from National Oil Corporation (NOC) and its
chairman Ahmed Al-Magbry be retained in his place. There is however,
serious dissatisfaction in the Libyan oil industry about Agoco’s senior
management. According to one source, NOC has already made three attempts
to replace Magbry, but each time the decision has been vetoed by the
Oil and Gas Ministry.
Agoco’s board is reported to be divided and its personnel are also
split between those who support the current management and those who
accuse it of giving large wage increases to some workers in the fields,
while neglecting others. It is also blamed for a failure to resolve
fundamental technical problems which are now seriously restricting
output. A company source said that “production is very low because of
demonstrations and the old problem of electricity. They fixed some
fields but then there is another problem in another field. The
equipment and surface facilities are old in general.”
Lack of output from Agoco’s eastern fields has worsened an already
bad situation at Libya’s eastern refineries. The small refinery at
Tobruk is not working and the 220,000 b/d Ras Lanuf Refinery, Libya’s
largest, is also down. Having closed for routine maintenance, its
workers went on strike and it has not reopened. However, even if it does
restart, it cannot operate for long. It “went down for planned
maintenance and didn’t come on again. Even if it does come back it has
only five days of crude in storage,” said the international oil market
source. It is supplied with a blend from Messla and Sarir rather than
from fields closer to it in the central part of the Sirte Basin.
Problems at fields and terminals in the west of Libya have mostly
been due to protests rather than technical issues. MOG’s El Fil (or
Elephant) field has been shut in because of a dispute between local Tebu
tribes and security personnel provided by the Zintan Military Council.
According to a recent document posted on Facebook, the Zintan militia at
El Feel have requested 30 SUV vehicles, the employment of
thuwar in the company, training of
thuwar
– including overseas – at the company’s expense, health insurance and a
range of other benefits and concessions. It said these things were
necessary as compensation for costs incurred since they took over
security at the field in November 2011. Shakmak said the situation at
the field was “under control”, although production had not resumed.
However, it was reported on 11 August that an agreement with staff had
been reached and that production would resume.
El-Fil oil is exported via the Mellitah terminal which also deals
with condensate from the Wafa field. This production has also been
interrupted. In late July, Amazigh activists blocked the condensate
pipeline at Nalut, demanding that their language receive full
recognition in the proposed new constitution.
Some reports have suggested that production at the As-Sharara field
operated by Akakus Oil Operations and Repsol may have been affected by
similar problems. But on 7 August a Repsol spokesman confirmed that “the
fields operated by Akakus are working normally and producing at normal
levels”. The Zawiya refinery which is supplied by crude from Akakus is
also reported to be working as usual. Together with offshore oil
production in western Libya and gas production at Mellitah’s West Libya
Gas Project, this is the only part of the whole industry which, for the
time being, is operating it should.
John Hamilton is a contributing editor at African Energy
(www.africa-energy.com) and a director of Cross-border Information (www.crossborderinformation.com).
libya herald
يبحث
عدد من اللاعبين المصريين المستغنى عنهم، والذين لم يجددوا عقودهم مع
أنديتهم عن عروض للعب في ليبيا التي فتحت الباب على مصراعيه أمام اللاعبين
الذين فشلوا في اللعب محليا. وكان نادي أهلي طرابلس
الليبي الذي يقوده حسام البدري تعاقد مع عمر جمال وأحمد حسن مكي، فيما ضم
الاتحاد الليبي أحمد رءوف والهلال عبدالله فاروق.
علن
مصدر من السفارة الأميركية بالعاصمة طرابلس، اليوم الاثنين، أن السفارة
استأنفت أعمالها بالمدينة بعد تعليقها في وقت سابق من الشهر بسبب مخاوف
أمنية.