Tripoli has beaten expectations in restoring oil and gas output to pre-war levels. Few watching the conflict thought it could be achieved so quickly, but there is still plenty of uncertainty ahead.

Security remains an issue, but perhaps more critical in the long term will be Libya’s ambitions for the sector. International oil companies are optimistic about the potential to significantly boost output, but are wary of the lack of top-down planning from the Oil Ministry.

A previous masterplan for 2005-15 aimed to raise oil output to 3.5 million barrels a day (b/d) by 2020 from 1.8 million b/d, along with 3.5 million cubic feet a day (cf/d) of gas, up from 1.6 million cf/d in 2010. Libya’s new oil strategy looks like it will revise these figures down to more manageable levels. In addition, production increases will have to take into account Libya’s membership of oil producers’ group Opec, which sets quotas for each country’s exports to maintain control of the global oil price.

The sector urgently needs a long-term strategy to describe Libya’s intent in its upstream and downstream hydrocarbons industries. In the meantime, Libya’s oil sector managers and their international partners will have to continue working with short-term plans. 

Before handing over power to the 200-member General National Congress (GNC), the outgoing National Transitional Council expressed its hopes of signing a new set of exploration and production-sharing agreements. Terms in the previous bid rounds were tough, forcing firms to agree to large signature bonuses for their concession licences. Any new bid round would have to offer improved terms to attract new international oil companies to the country.

This is unlikely to go ahead, however, while no upstream strategy is set, and not before the GNC, itself an interim body, is replaced by a full-term government, backed by a constitution.