LIBYA NEED INVESTMENT $60 BLN
PLATTS - Libya's state National Oil Corp. is targeting a $60 billion overhaul of its oil and gas sector as it strives to reach a pre-civil war output level of around 1.6 million b/d by the end of this year.
During an interview on the sidelines of the JCCP International Symposium in Tokyo last week, Shaaban Bsebsu, chairman of Ras Lanuf Oil & Gas Processing Co., said Libya is producing around 1 million b/d of crude and aims to boost output to around 1.6 million b/d this year after overcoming technical and security challenges.
NOC clarified on Tuesday that if this investment is secured $20 billion will be allocated to revive the upstream business with the remaining $40 billion earmarked for downstream operations.
"[We] try to do this, but we have a lot of security problems we face, and we try to sort out conditions [to] be better," Bsebsu said. "[We] have a plan to reach more than 2 million [b/d] in 2020."
Ras Lanuf Oil & Gas is a subsidiary of NOC. NOC chairman Mustafa Sanalla has complained the company has not received the entire capital spending allocation from Tripoli in the last two years, which has made it difficult for the country's oil sector to revive its upstream business.
SECURITY, TECHNICAL CHALLENGES
Libyan crude output has risen sharply in the past two years, but security and political challenges continue to impede the oil sector. Despite expectations production will average just over 1 million b/d this year, the risk of conflict is unlikely to diminish anytime soon.
Areas in the southwest of the country, where the Sharara and El Feel oil fields are located, remain particularly prone to outages caused by chronic fuel shortages and security problems.
The country's production averaged 948,333 b/d last year, its highest annual average since 1.40 million b/d in 2012, according to Platts OPEC survey data. The country could produce about 1.6 million b/d before the civil war that started in 2011.
Libya's largest field, the 350,000 b/d Sharara, has remained shut-in since early-December after armed groups occupied the site.
The situation is expected to remain tense as forces loyal to Libya National Army, led by General Khalifa Haftar, are on their way to secure the field.
"We have a lot of challenges from the technical side point of view, and we need more investment to upgrade the older system," Bsebsu said.
With presidential and legislative elections due this year, various groups could increasingly focus on controlling the country's oil infrastructure and raise the risk of attacks on key pipelines and production facilities.
Last week, Sanalla reaffirmed that NOC would remain independent and wanted to detach itself from "political or military bargaining."
"Efforts to politicize our work are not in the interest of the Libyan people," Sanalla said in a statement. "NOC reaffirms its call for the immediate and unconditional restoration of security at Sharara. We reject any type of blackmail and intimidation as we work to improve the lives of every Libyan."
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