Africa: Libya
August 2000 Vol. 221 No. 8 International Outlook AFRICA Libya Libya is hoping that its cooperation in the Lockerbie bombing trial, currently ong
AFRICALibyaLibya is hoping that its cooperation in the Lockerbie bombing trial, currently ongoing in the Netherlands, will gain it favor with Western nations. The UNs lifting of sanctions last year will help Libyas oil patch, as will the trials outcome, assuming no government involvement is revealed. The UK restored full diplomatic relations with Libya in November, while the U.S. recently allowed officials from Conoco, Marathon and Oxy to visit Libya to inspect assets frozen in the mid-1980s.
Congress scrapped most of Libyas ministries in March. Consequently, the head of the former oil ministry, Abdalla el-Badri, has been appointed chairman of state-owned National Oil Corp. (NOC). He now reports directly to the Libyan congress. Exploration. Libya opened 80 onshore and offshore blocks this May to international companies for exploration production sharing contracts (EPSAs). Fifteen blocks, located mostly in the Murzuk and Sirte basins, may soon have signed contracts. Last November, Repsol, OMV, TotalFinaElf and Saga signed a new agreement for Block M4 in Murzuk basin as an extension of existing EPSA terms on Blocks NC186 and NC187, held by the same consortium. Canadian-based Red Sea Oils C1-NC177 well tested non-commercial last December. The wells good oil shows and log results justify the drilling of two more exploration wells in Area NC177 in the coming year, along with a seismic program. Development. ENI-Agip and NOC continue progress on the massive Western Libya Gas Project, a development of the offshore Structure C in NC41 permit and onshore Wafa field in NC169. The $5.5-billion project involves laying an array of 34- to 16-in. pipelines to carry gas and condensate; an offshore platform; subsea clusters; building a processing plant on Libyas coast; and laying a 350-mi gas pipeline linking Melitah, Libya, to Sicily. The plant will have a 1-Bcfgd capacity and will export 80% of the gas to Italy half of which is under a 24-year, take-or-pay supply agreement with Italys Edison power company. Thirty-eight wells will be drilled over several years. If all goes as planned, first production will be in 2003. The En Naga North and West oil field in onshore Area NC177 was declared commercial in January, and a development plan was approved. Red Sea (60% stake) and Lundin Oil (40%) said proven and probable reserves are about 90 million bbl. The $133-million development will entail a 60-mi pipeline, surface treatment facilities and the drilling of five production wells. First oil should be in early 2001 at 12,500 bpd, ramping up to 30,000 bpd in the following years. Hyundai won a $250-million contract from NOCs Sirte Oil Co. for development on the giant Attahaddy gas field in Sirte basin. The work involves surface infrastructure, a gas processing plant and pipeline tie-ins. The field has estimated reserves of 9 Tcfg; it is expected online in 2002 and will produce 300 MMcfgd. Production. Output was estimated to average 1.3 million bpd of condensate plus crude in 1999, equal to its April 2000 OPEC quota. Even if the recent (July) OPEC increase of 27,000 bopd is added, the country is currently producing above its quota and near its 1.4 million-bopd capacity. Libya is now at less than half its peak output of 3.3 million bopd in 1970, and the production decrease may be partly due to U.S. sanctions on equipment, parts, and technology under U.S. patents. |