Libyan National Oil Corp. Meets with Majors

Libyan National Oil Corp. Meets with Majors

The chairman of Libya’s state-run National Oil Corporation met with major oil companies to discuss plans to expand the country’s declining petroleum production, Business Day Live reports. Company chairman, Mustafa Sanallah, said he met in Istanbul with France’s Total, Italy’s Eni SpA and the UK’s BP, among other companies, in an attempt to convince them to resume exploration in Libya, as a unity government is expected to take power this month.  “The situation will stabilize once a unity government is formed. I am optimistic this will happen,” Sanallah told the newspaper.

Due to violence and political chaos, oil revenues have fallen to less than 400,000b/d, Arab News writes –  much less than Libya’s 1.5mb/d capacity before the 2011 Arab Spring. A key advantage, however, is Libya’s low-cost of production – a barrel of Libya crude costs $10 to produce.

Western oil firms have heavily scaled back operations in Libya, in some cases leaving altogether. In December, representatives of Libya’s two rival governments signed a power-sharing agreement that called for the formation of a national unity government. However, the rival National Oil Corporations – one based in Tripoli, the other in Bayda – continue to compete over oil rights and exports. Further complicating matters has been attacks on Libya’s energy infrastructure, especially over the past month, which has heavily crippled oil production and exports.

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