IOCs ‘Exclude’ Libya From 2019 Plans

Libya managed six-year high output of 1mn b/d for 2018. But the country’s latest upsurge in instability came at a cruel time as IOCs were finalizing their 2019 plans. A step-up in IOC investment is a prerequisite for Libya getting anywhere near its 1.6mn b/d end-2019 output target. But Libya rates barely a footnote in their plans.

Despite the mammoth challenges facing Libya’s beleaguered oil and gas sector from dilapidated infrastructure to pressing security challenges, National Oil Corporation (NOC) head Mustafa Sanalla remains determined to push forward with plans to up output to 1.6mn b/d by end-2019 – a level last reached before the 2011 revolution (see chart 1) – and ultimately 2.1mn b/d by 2021.

But the outlook remains bleak. The central bank and internationally-recognized government based in Tripoli have yet to agree a 2019 budget, whilst the key 315,000 b/d-capacity El Sharara field remains shut-in after repeated security breaches ( MEES, 15 February ).

Mr Sanalla costs Libya’s upstream oil and gas renaissance at $20bn. But, amid chronic security woes, much-needed IOC investment pledges have been few and far between. Even the companies most often touted as being core to a planned upstream boost – Total, Eni and BP – barely mentioned the country in their 2018 results and 2019 spending plans. In theory Libya has cash to invest. With exports up sharply ( MEES, 15 February ), the Tripoli-based government netted a five-year high $24.6bn in oil and gas revenues for 2018 ( MEES, 25 January ). (CONTINUED - 1563 WORDS)


chart 1: Libya’s Crude Output Hit A Six-Year High In 2018 (Mn B/D)
chart 2: Libya’s Waha Concession Output At Five-Year High ('000 B/D)
chart 3: Sharara Output ('000 B/D)
chart 4: Harouge Output ('000 B/D)