Libya's National Oil Corporation (NOC) declared a force majeure on its biggest oil field that will see more than 300,000 barrels per day (bpd) of oil cuts from its production.
'NOC hereby declares a state of force majeure at the Akakus operated Sharara oil field as of Sunday, December 9, 2018,' the company said in a statement on Monday.
'NOC prioritizes the safety of staff and is currently reviewing evacuation procedures following threats to their wellbeing, and the forced shutdown of the oilfield by the armed militia claiming attachment to the local Petroleum Facilities Guard (PFG),' it added.
The company said the shutdown of the Sharara oil field would cause a production loss of 315,000 bpd, with an additional loss of 73,000 bpd at the El Feel oil field since it depends on Sharara for electricity supply.
'Production at the Zawiya refinery is also at risk due to its dependence on crude oil supply from Sharara and will cease producing essential fuels for local consumption unless alternative supply is identified,' it added.
The total cost of the shutdown to the Libyan economy is $32.5 million per day, according to NOC.
Libya's gross domestic product was around $51 billion in 2017, according to World Bank data.
Libya has struggled to maintain and increase its oil production, exploration and exports since 2011 due to political conflict and divisions within the country.
OPEC members agreed Friday to lower their total production by 800,000 bpd, and ensured that Libya was exempt from the oil cut deal.
By Ovunc Kutlu
Anadolu Agency
energy@aa.com.tr