Under new management, Libya's NOC announces first oil export after lifting force majeure

Libya, which replaced the board of state-owned National Oil Corp., is loading its first cargo of condensate since the lifting of force majeure from all ports and fields, though the legitimacy of the company's new leadership remains contested.

In a July 17 statement on its new Twitter account, NOC said the Italian flagged tanker Ibela had entered the Brega oil terminal to load the cargo.

The Libyan oil ministry confirmed the loading, saying in a statement that the Ibela's arrival signaled the official resumption of oil exports after nearly a three-month closure.

The lifting of force majeure was announced on July 15 by new NOC chairman Farhat Bengdara, an ex-governor of the Central Bank of Libya, who took his post following a showdown with former oil chief Mustafa Sanalla and his loyalists, who were evicted from NOC's Tripoli-based headquarters.

Libya's UN-backed Government of National Unity said July 14 it had installed Bengdara as chairman, while Sanalla has said his removal is illegal.

Sources in the country said some militia have refused to accept Bengdara's appointment, with tensions threatening to spill over into armed violence.

Impaired production

Libya's oil sector has been under severe political turmoil for months, exacerbating a tight market, with various groups seeking control of NOC and its revenues.

Prior to Sanalla's ouster, NOC said on June 30 Libyan crude exports had ranged from 365,000 b/d to 409,000 b/d, a decrease of as much as 865,000 b/d from normal rates, as it declared force majeure on loadings out of Es Sider and Ras Lanuf terminals, as well as production at the El-Feel oil field, following the previous closures of the Brega and Zueitina terminals.

Crude production hit a two-year low of 650,000 b/d in June, according to the latest Platts survey of OPEC+ output by S&P Global Commodity Insights, against capacity of 1.2 million b/d.

Sources pegged current output at around 550,000 b/d.

Sanalla said on July 13 NOC had lifted force majeure on Zueitina and Brega, allowing the tanker Ibela to carry condensate for use in power generation in Libya.

The lifting of force majeure followed intense negotiations to allow the tanker to enter the terminals and ship condensate, a step that will be followed by other steps, Sanalla said at the time.

Libya's eastern Gulf of Sirte includes four main oil export terminals with a total capacity of 630,000 b/d – Es Sider (250,000 b/d), Ras Lanuf (200,000 b/d), Brega (90,000 b/d) and Zueitina (90,000 b/d).

Libya holds the largest crude reserves in Africa and exports mainly light-sweet crude grades such as Brega, Es Sider and Sharara. Its main export markets are in southern Europe and China.