Libya's NOC, Eni sign agreement to develop two plots with 6 trillion cubic feet of gas reserves

Libya's state-owned National Oil Corp. announced a new partnership with Italy's Eni on Jan. 28 to develop two plots with expected natural gas reserves of 6 trillion cubic feet and an estimated production capacity of 750 million cf/d for 25 years

The agreement is the first of its kind in Libya since at least 25 years ago, NOC said in a statement. Eni said on its website that the agreement is intended to increase gas production at two offshore fields and develop them, called "Structures A&E," to supply Libya and Europe. The project also includes the construction of a carbon capture and storage plant in Mellitah, Eni said. Eni noted NOC's plans to increase gas output and crude oil output to up to 2 million b/d, and that talks were underway in August for "renewable-related projects" in Libya.

The gas fields will generate $7 billion to $9 billion of investment in Libya's oil and gas industry and generate up to $13 billion in net revenue for the country, NOC said.

The agreement was previewed by NOC's Chairman Farhat Ben Gdara on Libya's Al-Masar TV on Jan. 23.

Libya is trying to woo back international oil companies to explore for gas and oil, particularly offshore, after lifting a force majeure on exploration and production agreements in December. The country pumped 1.17 million b/d of crude in December, according to the monthly Platts report by S&P Global Commodity Insights.

In 2021, 3.18 Bcm of gas was supplied in Libya, Eni said on its website. The Libyan gas produced by the Wafa and Bahr Essalam fields operated by Mellitah Oil & Gas, an operating company jointly owned by Eni and NOC, is brought to Italy through the Green Stream pipeline. The 520 km pipeline crosses the Mediterranean Sea connecting the Mellitah treater on the Libyan coast with Gela in Sicily. The natural gas pipeline has a capacity of around 8 Bcm/year, Eni said, noting it has been operating in the country since 1959 and is currrently active in exploration and production and global gas and LNG sectors in the offshore of Tripoli and in the desert area.

Eni said its 2021 production in Libya was 24 million barrels of oil and condensates, 198 Bcf of gas and 62 million boe of hydrocarbons.