Libya restarts Wintershall’s oil fields to boost national output
Libya’s state energy producer National Oil Corporation has announced the restart of production at Wintershall’s Sara oil fields more than two months after they were closed by protests, in the latest sign that the OPEC nation’s oil industry may be stabilising.
The fields will increase the North African country’s crude output by 57,000 bpd, according to an NOC statement on the 21st January.
Wintershall confirmed that crude output at the fields resumed on The 21st January, according to a statement from the company.
The shutdown since November resulted in the loss of 4.4 MMbpd of production at a cost to the economy of US$281.5 million, NOC said in the statement.
The municipality of Jikharra had decided to reopen the area following pressure from NOC and the public prosecution, it said. The fields, located in the Jikharra area, were closed in early November due to protests by people demanding jobs and more local development projects.
Since the 2011 war that ousted former leader Muammar Qaddafi, Libya has been carved up among dozens of militias, with rival administrations in the east and in Tripoli. Infighting since 2014 crippled the production and exports of oil, Libya’s main source of income, devastating the import-dependent economy.
Oil output has since been increasing and reached last year its highest level in four years. Output has stabilized at about one MMbpd over the last quarter, hampered only by isolated disputes and shutdowns.
Crude Exports
NOC Chairman Mustafa Sanalla said the restart in Jikharra was a setback for a parallel Libyan oil administration based in eastern Libya, which for several years had tried to gain control over the country’s central and eastern oil facilities and export the crude independently. It failed to do so as major international oil companies only recognise the Tripoli-based NOC.
“The perpetrators and others considering using the tactic should remember this is a very serious offence for which there is no statute of limitations,” Mr Sanalla said in the statement.
The restoration of Libyan oil despite the country’s divisions has put the spotlight on Mr Sanalla, whose influence has waxed in a country dependent on oil exports. In another sign the sector is stabilising, Royal Dutch Shell and BP have agreed to annual deals to buy Libyan crude.
Production remains well below the level of 1.6 MMbpd reached before the revolt in 2011, however, and efforts to increase output and exports are complicated by Libya’s commitment to an OPEC campaign to reduce a global surplus.