Head of Libya’s Tripoli-based National Oil Corporation (NOC), Mustafa Sanalla, has explicitly objected to a deal between the UN-backed government and the Petroleum Facilities Guards (PFG) to reopen key ports, threatening the country’s crude oil output, Reuters reported.
In his letter to UNSMIL Chief, Martin Kobler, Sanalla said that he was dismayed by the meeting Kobler held with Ibrahim Jadhran, the Head of the PFG and a militia strongman, who in nearly three years had allegedly cost Libya over $100b in lost oil revenues, according to Libya Herald. He noted that it is a mistake to reward Jadhran for a blockade of the oil ports of Ras Lanuf, Es Sider, and Zueitina.
The agreement between the government and the PFG was said to be implemented within days as the ports would be operational again. For Sanalla, however, the deal, which included a pay out to PFG workers, would prompt others to disrupt oil operations in the hopes of a similar payout.
Sanalla warned that the NOC will not lift force majeure in the export terminals in order to protect itself against legal claims. He added that due to attacks from Islamic State militants and other damage, exports from the ports would struggle to surpass 100,000 b/d in the near future. However, NOC’s largest subsidiary, Agoco, would be able to increase production to the level of required 100,000 b/d in case it received the operational budget from the government.
OPEC member Libya has been in an economic turmoil that slashed its oil output to less than 25% of 1.6mb/d seen before the fall of the then-President Muammar Gaddafi. Rival governments, one in Tripoli and one in the east, backed by armed factions have struggled for control over the North African state since 2014 before NOC’s top officials agreed to unify the oil sector.