Key Libyan oil field faces new output problems

03 January 2019
Security breach on 1 January resulting in the theft of key equipment

Libya’s National Oil Corporation (NOC) faces yet more problems at its Sharara oil field, with the latest security breach on 1 January resulting in the theft of key equipment from the country’s largest oil field.

It is the third incident in a week at the 350,000 barrels a day (b/d) Sharara oil field which sits in the remote deserts of Libya’s southwestern Murzuq basin, NOC said in a 3 January statement following an inspection.

Among the stolen items were transformers and cables from a number of wells, which NOC warned will reduce the field’s operational capacity by around 8,500 b/d - just under 3 per cent.

Sharara has been offline since 10 December, when protestors and armed militias took over parts of the field. This also led to the closure of the nearby El-Feel oil field, which produces another 73,000 b/d, but relies on power from Sharara for its operations.

Protests over the lack of basic services and shortage of fuel in the restive southern region have been growing in the absence of any real state authority, although NOC has been attempting to alleviate the fuel crisis with extra truck shipments in the last few weeks.

Earlier in the week an armed group assaulted a civilian guard at the field and another criminal group forced their way into the field’s support facility to steal vital goods. The latest breach at Sharara has prompted NOC to call on the internationally recognised government in Tripoli to consider emergency security measures to re-establish order and halt looting of the field.

“We are very concerned these attacks are not simple robberies but are part of a systematic attempt to destroy the Sharara system,” NOC chairman Mustafa Sanalla said in a statement.

“The legitimate and rightful concerns of the Southern Libyan communities are being hijacked and abused by armed gangs, who instead of protecting the field to generate wealth for all Libyans, are actually enabling its exploitation and looting,” he said.

Sanalla has previously warned the government not to give into the temptation of paying ransoms for the security of Sharara, which would set a dangerous precedent, encouraging further attacks on its oil infrastructure.

NOC said it would not restart production at Sharara oil field or lift force majeure on crude exports from the Zawiya oil terminal, even if ransom payments were made by the Ministry of Finance.

The closure of Sharara and El-Feel brought Libya’s oil production crashing down by nearly a third, having previously averaged approximately 1.3 million b/d, the highest level in years. NOC estimates the closures will cost Libya more than $32m in lost revenues each day.

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