25.07.12 Libya Focus
Oil production on the up
Austria's OMV has reported a rapid recovery of its Libyan oil production following the end of
the revolution. It reached 25,000 b/d in the first quarter of 2012 and the
pre-war rate of 34,000 b/d in the second quarter.
National Oil Company (NOC), its Agoco subsidiary and Wintershall are working together on a €31.4
million project to construct a 100,000 b/d capacity 55km crude oil pipeline
which
will help boost oil exports The installation is scheduled to be completed in
August and the project as a whole will be handed over to Agoco in March 2013.
Repairing the Libyan economy is proving more difficult than forecast. Although
the damage to the oil infrastructure is not particularly severe, it is
geographically widespread and the reconstruction activity has been fragmented.
According
to industry sources the final return to the 1.6 million b/d pre-war levels of
oil
output could take until the end of 2012. Meanwhile, the political situation has
been subject to slow improvement but security problems still remain. Outside
the
oil sector there is talk of large scale investments that could be made in the
short term which would provide an enormous boost but only if the IOCs are
convinced, unlike Shell, of the long-term profitability of their Libyan oil
operations.
This week, in an example of the way the weak international market is impacting
on the Libyan oil industry, an NOC spokesman announced that the August official
selling price of its bench mark Es Sider crude is at the lowest level in almost
three years. It was cut by US$1.60 a barrel to a discount of US$1.30 to North
Sea
Dated Brent.
For more news and expert analysis about Libya, please see Libya Focus and Libya Politics & Security.
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