Libya's state oil firm needs $17 bln to reach 2 mln bpd -NOC chief says
27/11/2023 15:59
TRIPOLI, Nov 27 (Reuters) - Libya's oil state firm the
National Oil Corporation (NOC) needs a budget of $17 billion to
increase national oil output to 2 million barrels per day in
three to five years, its chief Farhat Bengdara said in an
interview.
Bengdara told Alwasat tv on Sunday there were no obstacles
to increase the output but "there is a lack of funding, not in
the way it should be."
The NOC has a plan that includes projects stabilizing
production and maintaining pipelines and equipment, and projects
for increasing production, Bengdara said.
The main projects that would help to increase national oil
output are related to maintaining the pipelines that were
installed in the 1960s, Bengdara said.
"These pipelines have expired and must be replaced,"
Bengdara said, saying the issue was their "greatest challenge".
"We promised to reach 1.3 million bpd and we have reached
1.295 million bpd before the end of the year. But we are talking
about infrastructure that was built in the 1960s and had never
been maintained, Bengdara added.
Oil production is Libya's main economic source and it
represents approximately 90 percent of the economy of the entire
country.
However, the political division between two administrations
vying for power in the east and west, casts a shadow over the
possibility of investing more to raise production in Libya,
particularly after holding general elections to unify the rival
parties in 2022 failed despite UN efforts.
The rival factions have repeatedly argued over the control
of oil production and revenue, which fuel the political chaos
and threaten to undermine the peace process.
According to data published by the Central Bank, exceptional
financial arrangements have been referred with a value of
approximately nine billion Libyan dinars, some $1.8 billion,
during the first 10 months of this year to NOC.
He said there was support from the Government of National
Unity (GNU) and the central bank. The government approved a
project aimed at replacing pipelines that flow from fields in
the Oasis and Sirt Gulf basin to Es Sidra and Ras Lanuf ports.
"We also have a project to replace a part of the eroded
pipelines from the Messla and Sarir fields to the port of
Hariga, and another project of a line from El Sharara field to
the port of Mellitah," he said.
Since the fall of Muammar Gaddafi in the NATO-backed
uprising in 2011, oil production has been repeatedly hit in the
OPEC member and third largest producer in North Africa by groups
blocking facilities, sometimes to demand material benefits but
also as a tactic to achieve wider political ends.
"We lost 70 per cent of our storage capacity due to wars,"
Bengdara said.
He added the plan was supposed to lead the country to 2
million bpd "if there are no problems or developments beyond our
control."
Bengdara, a central bank governor before 2011, was appointed
as the NOC chief in July, 2022 by the GNU, replacing Mustafa
Sanallah who led the company since 2014.
(Reporting by Libya's Reuters newsroom; editing by David Evans)
((ahmed.elumami@thomsonreuters.com; @AhmedElumai;))