Libya plans to allow foreign oil companies to invest once again in Libyan oil production in the coming months after a self-imposed moratorium in 2011, according to the statement released by Libya's National Oil Corporation (NOC) Tuesday.
Speaking at an energy conference in London, NOC chairman Mustafa Sanalla said that "NOC-driven projects to expand oil production could create a virtuous circle of domestic economic stimulus and security."
"We intend in the coming months to lift our self-imposed moratorium since 2011 on foreign investment in new projects to achieve the best national interest for the Libyan oil sector and for Libya as a state," Sanalla said in a statement.
Oil production in Libya could reach 1.25 million barrels per day (bpd) by the end of 2017 and 1.6 million bpd by 2022, Sanalla noted, adding that, "After three years of blockades by the Petroleum Facilities Guards, all major oil export routes are now open."
Libya's economy depends primarily on the oil sector, which represents over 95 percent of export earnings. Moreover, the oil and gas sector accounts for about 60 percent of total GDP. Before the civil war in 2011, it was an important contributor to the global supply of light, sweet, low sulfur crude oil, which Libya mostly exports to European markets.
From January to October 2015, Libya's crude oil production averaged slightly more than 400,000 bpd, significantly below the 1.65 million bpd that Libya produced in 2010, according to the U.S. Energy Information Administration (EIA) country analysis.
Investment in oil production capacity is needed to build on the opportunity created after the Central Petroleum Facilities Guards, under Ibrahim Jadhran, were removed from the ports of the Oil Crescent by the Libyan National Army in September, and flows from the Shahara field were unblocked.
The Sharara field was blocked off since November 2014 due to the conflict between forces loyal to Commander Khalifa Haftar in Libya's east and other local armed rival factions. The field with a production capacity of about 330,000 bpd, is located 800 kilometers to the southwest of Tripoli and was officially re-opened in December 2016.
"This can be an important foundation of stability in Libya if we build on it," Sanalla continued.
He said that the oil sector had suffered from chronic under-investment, and added that the country and the integrity of the NOC is the best guarantee there is that Libya will be preserved as a unitary state.
Libya has been wracked by turmoil since 2011, when a bloody uprising ended with Gaddafi's ouster and his death after more than four decades in power.
By Ebru Sengul
Anadolu Agency
ebrusengul@aa.com.tr
