News / Africa

Some Looking Forward to Recovery of Libyan Oil Production

Some Looking Forward to Recovery of Libyan Oil Production
Some Looking Forward to Recovery of Libyan Oil Production
William Ide

Although fighting continues in parts of Libya, and a bit of uncertainty remains, some are already beginning to look at the prospects of recovery. Oil companies, and countries that rely on imports of natural resources from Libya, are planning for the full restoration of the country's oil industry.


As opposition forces celebrate their capture of Moammar Gadhafi's headquarters compound, the work of rebuilding Libya’s war-ravaged cities and infrastructure is one of a host of challenges the country will have to deal with in the days ahead.

Oil is the country's key industry and getting oil production and exports back on-line is crucial. Libya has the largest oil reserves in Africa and before the uprising began, the country produced about 1.8 million barrels of oil a day, or about two percent of the world’s production.

Luckily, unlike the damage suffered by cities and towns, the oil industry appears to be largely unscathed.

Samuel Ciszuk, a senior Middle East analyst at IHS Energy, says Libya could quickly return to pre-war production levels. "Companies with large production capacity in Libya, for instance ENI but also companies like Repsol and so on which have a lot of facilities in the southwest as far as we know has escaped damage almost completely," he said.

No one will know for sure how long it will take until the country's export and production facilities are inspected and back on line.

Over the past several days, global oil prices have largely followed developments in Libya. As Moammar Gadhafi's grip on power began slipping, following the rebels' quick offensive into Tripoli, prices dropped. But then began rising as pockets of fighting persisted and as other global economic volatility put pressure on the cost of crude.

Most of the Libya’s oil is exported to Europe, with Italy receiving the largest portion by far. China and other countries are major importers as well.

Ahmed Jehani, chairman of the stabilization team of Libya’s National Transition Council, says oil agreements made before the Gadhafi government's downfall will be honored. "All contracts will be honored. All lawful contracts will be offered, whether they are in the oil and gas complex or in the contracting. At the moment it is not for this government to decide whether they will be revoking any contract," he said.

The international community has expressed its readiness to come to Libya's aid and help it rebuild. And the United nations is holding a meeting on Libya’s future later this week.

Libya's infrastructure was weak before the war started, some regional analysts note, so the amount of reconstruction needed is limited. But building up a new Libya will take money.

Michele Dunne, who heads the Rafik Hariri Center for the Middle East at the Atlantic Council, says that is something Libya is well prepared for. “Libya will not face the problem that some other countries have had because they’ll have ready money to pay for it. If you’ve got ready money to pay for the reconstruction, then its much less of a problem," he said.

A quick return of oil production will help, Dunne says. As will the return to Libya of billions of dollars worth of Moammar Gadhafi’s frozen assets overseas. The assets were frozen by the U.N. in February and now the international community is working to get the urgently needed funds to the anti-Gadhafi opposition as soon as possible.

You May Like

Is Air Travel Safe?

Aviation expert says despite tragic losses of Malaysian Airlines flights 370 and 17, industry experienced lowest fatality rate in recorded history last year More

Multimedia 100 Days Later, Nigerian Girls Still Held

Activists holding rallies in Nigeria and several other countries to mark 100th day of captivity for more than 200 schoolgirls being held by Boko Haram More

Chocolate Too Bitter? Swap Sugar for Mushrooms

US food technology company develops fermentation process using mushrooms to reduce bitterness in cocoa beans, believes it will cut sugar content in candy More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
IAEA: Iran Turns its Enriched Uranium Into Less Harmful Formi
X
July 22, 2014 10:26 AM
Iran has converted its stockpiles of enriched uranium into a less dangerous form that is more difficult to use for nuclear weapons, according to the United Nations’ Atomic Energy Agency. The move complies with an interim deal reached with Western powers on Iran's nuclear program last year, in exchange for easing of sanctions. Henry Ridgwell reports for VOA from London.
Video

Video IAEA: Iran Turns its Enriched Uranium Into Less Harmful Form

Iran has converted its stockpiles of enriched uranium into a less dangerous form that is more difficult to use for nuclear weapons, according to the United Nations’ Atomic Energy Agency. The move complies with an interim deal reached with Western powers on Iran's nuclear program last year, in exchange for easing of sanctions. Henry Ridgwell reports for VOA from London.
Video

Video Relic of Saint Draws Catholics Worried About Immigration Issue

A Roman Catholic saint who is a figure of devotion for those crossing the border into the United States is attracting believers concerned about the plight of undocumented immigrants. Mike O'Sullivan reports from Los Angeles, where a relic of Saint Toribio has drawn thousands to local churches.
Video

Video Ukraine Rebels Surrender MH17 Black Boxes

After days of negotiations, a senior separatist leader handed over two black boxes from an airliner downed over eastern Ukraine to Malaysian experts early Tuesday. While on Monday, the U.N. Security Council unanimously demanded that armed groups controlling the crash site allow safe and unrestricted access to the wreckage.
Video

Video In Cambodia, HIV Diagnosis Brings Deadly Shame

Although HIV/AIDS is now a treatable condition, a positive diagnosis is still a life altering experience. In Cambodia, people living with HIV are often disowned by friends, family and the community. This humiliation can be unbearable. We bring you one Cambodian woman’s struggle to overcome a life tragedy and her own HIV positive diagnosis.
Video

Video Nature of Space Exploration Enters New Age

Forty-five years ago this month, the first humans walked on the moon. It was during an era of the space race between the United States and the Soviet Union. World politics have changed since then and -- as Elizabeth Lee reports -- so has the nature of space exploration.
Video

Video Chicago’s Argonne Lab Developing Battery of the Future

In 2012, the U.S. Department of Energy’s Office of Science awarded a $120 million grant to a new technology center focused on battery development - headquartered at Argonne National Laboratory in suburban Chicago, Illinois. As VOA’s Kane Farabaugh reports, there scientists are making the next technological breakthroughs in energy storage.
Video

Video In NW Pakistan, Army Offensive Causes Massive Number of Displaced

Pakistan’s army offensive in North Waziristan has resulted in the large-scale displacement of the local population. VOA's Ayaz Gul reports from northwest Pakistan where authorities say around 80 percent of the estimated 1 million internally displaced persons [IDPs] have settled in Bannu district, while much of the remaining 20 percent are scattered in nearby cities.
Video

Video Kurdish Peshmerga Force Secures Kirkuk, Its Oil

The Kurdistan regional government has sent its Peshmerga troops into the adjacent province of Kirkuk to drive out insurgents, and to secure the area's rich oil fields. By doing this, the regional government has added a fourth province to the three it officially controls. The oil also provides revenue that could make an independent Kurdistan economically strong. VOA’s Jeffrey Young went out with the Peshmerga and filed this report.
Video

Video Malaysia Reeling: Second Air Disaster in Four Months

Malaysia is reeling from the second air disaster in four months involving the country’s flag carrier. Flight 340 vanished in March and despite an extensive search, no debris has been found. And on Thursday, Flight 17, likely hit by a surface-to-air missile, came apart over eastern Ukraine. The two incidents together have left more than 500 people dead. VOA Correspondent Steve Herman reports from Kuala Lumpur.

AppleAndroid