June 13, 2024
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OIL & GAS

Protests Prompt Libya’s NOC to Declare Force Majeure at Sharara Oilfield

Libya’s National Oil Corporation (NOC) announced on Sunday the immediate declaration of force majeure at its Sharara oilfield, capable of producing up to 300,000 barrels per day, citing ongoing protests in the region.

This marks another disruption in Libya’s oil output, which has faced challenges since the tumultuous events following the 2011 NATO-backed uprising against Muammar Gaddafi.

NOC explained in a statement that the closure of the Sharara oilfield has halted crude oil supplies from the field to the Zawiya terminal. The Sharara field, located in the Murzuq basin in southeast Libya, is among the country’s largest and has been a frequent target for local and broader political protests.

Operated by state oil firm NOC through the Acacus company, the Sharara field involves collaborations with international entities such as Spain’s Repsol, France’s Total, Austria’s OMV, and Norway’s Equinor.

Ongoing negotiations are in progress to resume production at the Sharara oilfield at the earliest, according to NOC.

Last week, protesters in the Fezzan region in the south closed the field, demanding improved public services and development projects. Concerns arise regarding the global market’s confidence in the consistency of Libyan oil supply, potentially impacting the marketing of Libyan oil, as stated by the oil and gas ministry.

“The loss of confidence in the continuity of supplying the global market with Libyan oil will result in Libyan oil remaining unmarketed,” the oil and gas ministry said in a statement on Wednesday.

The ministry warned of the serious consequences of facility closures, highlighting the difficulties in quantifying and explaining the damage caused. Reopening production requires extensive maintenance, addressing technical issues, and incurring a substantial cost borne by the Libyan state treasury.

This latest incident follows the July disruption when tribal protesters halted production at the Sharara, Elfeel, and 108 fields over the abduction of a former finance minister.

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