Libya declares force majeure on oil field

11 June 2020
Militias shut down Sharara days after restarting production

Libya’s National Oil Corporation (NOC) has declared force majeure on exports from the country’s biggest oil field days after it reopened.

An armed militia stormed the oil field on 8 June and stopped production at the field early on 9 June, according to a statement released by NOC.

In the statement, it said: “NOC’s board of directors strongly condemns the crime committed by an armed group on the evening of Monday June 8 2020.

“The armed group, which came from Sebha, stormed the Sharara oil field and pulled their guns on civilian unarmed workers, coercing them to stop production at the field at dawn on Tuesday June 9 2020, only three days after production was resumed.

“NOC confirms the shutdown of production and declares force majeure on the Sharara field crude oil exports.”

NOC blamed the leader of the so-called Libyan National Army (LNA), Khalifa Haftar, for ordering the raid on the oil field.

In its statement, NOC said: “The shutdown of production will cost the treasury further losses and will lead to new technical damages.

“NOC also expresses its concern about the breach by this armed group of the strict coronavirus pandemic control programme followed in all the facilities of the corporation and considers their entry into the field in this way to be a serious threat to the health of workers.”

NOC chairman Mustafa Sanalla said: "This criminal group dared to enter the field with heavy weapons.

“It is clear that this criminal group places the interests of its commanders and the interests of the foreign powers tampering in Libya above the interest of the country.

“Instead of defending the country's interest and protecting civilians, the members of this armed group have directed weapons against our loyal Libyan workers who are making tremendous efforts to try to prevent Libya from resorting to banks to borrow to feed its people."

NOC said it had informed Libya’s public prosecutor’s office of this crime and said it would take measures to pursue the crimes at the local and international levels.

It also said it totally rejected the presence of any armed personnel inside its facilities in all its sites, any interference in its work, and attempts to use the facilities as a political or military bargaining chip.

Dramatic changes

The rapidly evolving situation at the Sharara field reflects recent political and military developments in Libya, according to Hamish Kinnear, a risk analyst at Verisk Maplecroft.

“Fluidity has been the watchword of Libya's civil war since mid-April, when forces aligned with GNA began to seize LNA-held positions in western Libya,” he said.

“The frontlines are now at the central city of Sirte and near Al-Jufra, a key LNA-held airbase.”

The shutdown on 9 June was the 20th time that production at Libya’s largest oil field has been disrupted since the beginning of the revolution and civil war that ousted Muammar Gadhafi in February 2011, according to Verisk Maplecroft.

The field, which produces around 300,000 barrels a day (b/d) at full capacity, has been online for nearly 1,500 days since February 2011, costing the NOC millions in lost barrels and billions of dollars in lost revenues.

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