May 2, 2021 [Hellenic Shipping News] Libya’s crude output could rebound in the coming days after the state-owned National Oil Corporation lifted force majeure on exports out of the eastern Marsa el-Hariga terminal on April 26.
Lifting force majeure comes almost a week after an oil sector budget row, which had pushed production down under 1 million b/d.
In a statement, NOC confirmed on April 26 that crude loadings out of the 250,000 b/d Marsa el-Hariga terminal were set to resume.
This follows the oil and gas ministry settling a funding dispute and agreeing to pay Dinars 1.048 billion ($232.4 million) to NOC. The ministry said on April 21 it had already transferred Dinars 500 million to the state-run producer.
On April 19, NOC declared force majeure on crude exports out of the key Marsa el-Hariga terminal, after its subsidiary Agoco resorted to shutting down output due to lack of funds. Agoco operates the Sarir, el-Bayda, Hamada, Mesla, Nafoora and Majid oil fields, which have a total capacity of 280,000 b/d.
Industry sources said production from these fields was likely to come back online in the coming days.
NOC has been locked in a dispute with the Central Bank of Libya over the past few months, which had persisted despite the formation of the interim Government of National Unity.
Risks to supply
Libya’s production recovery could remain volatile amid concerns the Petroleum Facilities Guard might block the Es Sider export terminal due to a long-running dispute over so-called field allowances.
Libya pumped 1.19 million b/d in March, its highest since June 2013, according to the monthly S&P Global Platts OPEC Survey.
Disruption risks and sporadic shutdowns are likely to persist, making Libya the most obvious concern to global oil supply this year, according to S&P Global Platts Analytics.
“With clear budget and technical issues, risks are growing to our supply forecast through year-end of 1.2 million b/d, let alone the NOC’s target of 1.45 million b/d,” it said in a recent note.
Libya holds Africa’s largest proven reserves of oil, and its main light sweet Es Sider and Sharara export crudes are sought after by refineries in the Mediterranean and Northwest Europe for their gasoline and middle distillate yields.
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