News / Economy

Chaotic Libya Struggles to Maintain Oil Output

FILE - In this photo from February 2011, an employee works at an oil refinery in eastern Libya.FILE - In this photo from February 2011, an employee works at an oil refinery in eastern Libya.
x
FILE - In this photo from February 2011, an employee works at an oil refinery in eastern Libya.
FILE - In this photo from February 2011, an employee works at an oil refinery in eastern Libya.
Reuters
Libya is struggling to keep its oil output stable, let alone increase it, as protests cut crude exports in the sector that supplies 95 percent of state revenue.
 
In the past year, disgruntled Libyans have protested at oilfields and export ports, clouding initial optimism over a speedy return to output levels of nearly 1.6 million barrels per day (bpd) following the 2011 war that ousted Moammar Gaddafi.
 
The state National Oil Corporation (NOC) said on its website output had slumped to less than one million bpd following “irresponsible acts by some individuals” who shut down two export terminals and a major oilfield.
 
“The industry is suffering and this cannot go on as it is,” a senior Libyan oil industry source said. “These kind of problems keep recurring and this is hurting the whole of Libya.”
 
The new leadership has struggled to impose its authority on a myriad of armed groups who have the real power on the ground in a country awash with weapons left over from the war.
 
Protesters, usually with social demands, have forced Tripoli to comply with their requests before ending sit-ins or turning valves back on.
 
In the latest headache for the industry, the operator of the major El Feel field, a joint venture between the NOC and Italy's Eni, halted output as some 50 protesters staged a demonstration, calling for jobs and salaries. El Feel, which lies in Libya's southwestern desert, can pump up to 130,000 bpd.
 
In the east, protesters forced the shutdown of the Zueitina and Marsa al-Hariga terminals but workers there said on Tuesday operations were resuming after the demonstrators had left the sites. Zueitina has faced numerous disruptions this year.
 
“If the protesters go to local councils, nobody will listen to them. But if they go to the oilfields or terminals, they have everybody's attention,” a Libyan oil worker said. “This problem keeps happening and the government doesn't know how to cope.”
 
Costly Disruptions
 
Without specifying, the NOC said the latest output cuts were costing the country “hundreds of millions of dollars” in lost income.
 
A prolonged drop in output could be disastrous for state finances, already strained by salary spending which now includes tens of thousands of former rebel fighters from the war.
 
Last month, a committee overseeing Libya's energy industry within the national assembly, said those who forcefully closed down installations should be held accountable in court.
 
But with state security forces and courts still weak, enforcing such action remains a mammoth task. A 15,000-strong force guarding oil sites lacks proper training and equipment and its members have at times fought amongst themselves.
 
“We need a government to make strong decisions and guards to protect oilfields,” Yussef al-Ghariani, of an oil workers' union in the eastern city of Benghazi, said. “Every delay is costly.”
 
In April, oil flows hit 1.55 million bpd, according to the oil ministry, which has previously said OPEC-member Libya aimed to increase output to 1.7 million bpd from the third quarter.
 
But with continuous disruptions due to the protests and sometimes technical problems, this target now appears elusive.
 
“The trend is going in the wrong direction. They are struggling to keep production at 1.3-1.4 [million bpd] whereas they were hoping to be raising it and hitting new peaks,” Richard Mallinson, of consultancy Energy Aspects, said. “The likelihood is only that it will get harder and harder to maintain levels we have seen over the last few months as protests continue and the situation does not improve.”
 
Foreign oil companies are increasingly unsettled by sporadic violence and oil services firms are not rushing to send workers back to Libya.
 
“You just don't know where things are going. People who were already worried about coming here will be even more reluctant,” one foreign oil worker said, declining to be named.
 
With the continuing chaos tainting Libya's image abroad, oil market players are factoring in more disruptions.
 
“Every time you get news of one situation being resolved, you just wait and expect to hear what is the next field that is being shut or obstruction to a terminal,” Mallinson said.

You May Like

Bernie Sanders Surge Reflects US Shift on Socialism

Although most analysts say it is unlikely he will get the Democratic nomination, Sanders' campaign opens up questions and issues that are otherwise marginalized More

Crowdfunding Helps Save Neil Armstrong's Spacesuit

Smithsonian turns to Kickstarter to raise more than $700,000 to help preserve the spacesuit worn by the first man to walk on the moon More

Video On IS Frontline, Kurdish Fighters Ready for Offensive

Peshmerga soldiers say although they need more heavy artillery, they are poised to take the fight to the Islamic State extremists on their turf 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.
Drowned Migrant Toddler Photo Triggers European Outragei
X
Henry Ridgwell
September 04, 2015 11:36 AM
The harrowing picture of a drowned three-year-old Syrian boy washed up on a Turkish beach appears to have galvanized Europe’s leaders into doing more to address the refugee crisis. France, Germany and Italy issued a joint call Thursday for compulsory quotas of refugees for all EU states. But there were chaotic scenes in Hungary as police tried to force migrants off a train heading for Austria. Henry Ridgwell has more. And a caution, some of the images in this report may be disturbing.
Video

Video Drowned Migrant Toddler Photo Triggers European Outrage

The harrowing picture of a drowned three-year-old Syrian boy washed up on a Turkish beach appears to have galvanized Europe’s leaders into doing more to address the refugee crisis. France, Germany and Italy issued a joint call Thursday for compulsory quotas of refugees for all EU states. But there were chaotic scenes in Hungary as police tried to force migrants off a train heading for Austria. Henry Ridgwell has more. And a caution, some of the images in this report may be disturbing.
Video

Video Russians Observe 11th Anniversary of Beslan School Attack

This week, Russians have been observing the 11th anniversary of the attack by Islamic militants on a school in Russia's North Caucasus region that killed more than 330 hostages, including 186 children. The three-day siege and massacre that started on September 1, 2004 took place in Beslan, a town in the republic of North Ossetia, and is one of the bloodiest terrorist acts ever in Russia. VOA's Mike Richman reports.
Video

Video Native Americans Debate: Father Serra, Saint or Sinner?

Pope Francis will canonize an 18th century missionary to Spanish California during a papal visit to the United States this month.  But some Native Americans have criticized the elevation to sainthood of the missionary priest, Junipero Serra. VOA's Mike O’Sullivan has more from Los Angeles.
Video

Video Calais School Offers Another Face of Europe’s Migrant Crisis

Europe is facing mounting criticism over how it’s handling its biggest migration crisis since World War II. But not all Europeans believe building walls or passing repressive policies are the answer. A school for migrants in the French port city of Calais, is opening doors and building bonds across nationalities. VOA's Lisa Bryant reports.
Video

Video Kurdish Fighters on IS Frontline Ready for Offensive

Finger on the trigger, the Kurdish Peshmerga soldier stared across the dust at a village taken over by Islamic State extremists. The Kurdistan’s Khazir frontline, just 45 minutes from the Islamic State stronghold of Mosul. And at this point, the militants were less than two kilometers away. VOA's Sharon Behn reports.
Video

Video China Announces Troop Cuts at WWII Parade

Chinese President Xi Jinping Thursday announced plans to cut the world’s largest military force by 300,000 troops. The announcement was made during a massive military parade to commemorate victory over Japan in World War II. The event was shunned by most Western leaders and for some is raising fresh concerns about China’s military ambitions. VOA’s Bill Ide has more from Beijing.
Video

Video Russia-Japan Relations Cool as Putin Visits China for WWII Anniversary

Russian President Vladimir Putin is in Beijing for commemorations of the 70th anniversary of China's WWII victory over Japan. Putin is expected to visit Japan later this year, but tensions between Tokyo and Moscow over islands disputed since the war, and sanctions over Ukraine, could pour cold water on the plan. VOA's Daniel Schearf reports.
Video

Video Yemen ‘on Brink of Disaster’ as Medical Shortages Soar

Aid agencies warn Yemen is on the brink of humanitarian disaster – with up to half a million children facing severe malnutrition, and hospitals running out of basic medicines. There are fears Yemen's civil war could escalate as the coalition led by Saudi Arabia tries to drive back Houthi rebels, who seized control of much of the country earlier this year. Henry Ridgwell reports.
Video

Video Apps Helping Kenyan Businesses Stay Ahead of Counterfeiters

Counterfeit goods in Kenya cost the government as much as $1 billion each year in lost tax revenues. The fake goods also hurt entrepreneurs who find it hard to carve out a niche in the market and retain customers. But as Lenny Ruvaga reports from Nairobi, information technology is being used to try to beat the problem.
Video

Video Nobel Prize Winner Malala Talks to VOA

Nobel Peace Prize winner Malala Yousafzai met with VOA's Deewa service in Washington Sunday to talk about women’s rights and unveil a trailer for her new documentary. VOA's Katherine Gypson has more.
Video

Video War, Drought Threaten Iraq's Marshlands

Iraq's southern wetlands are in crisis. These areas are the spawning ground for Gulf fisheries, a resting place for migrating wildfowl, and source of livelihood for fishermen and herders. Faith Lapidus has more.
Video

Video Colombians Flee Venezuela as Border Crisis Escalates

Hundreds of Colombians have fled Venezuela since last week, amid an escalating border crisis between the two countries. Last week, Venezuelan President Nicolas Maduro ordered the closure of a key border crossing after smugglers injured three Venezuelan soldiers and a civilian. The president also ordered the deportation of Colombians who are in Venezuela illegally. Zlatica Hoke reports.
Video

Video Rebuilding New Orleans' Music Scene

Ten years after Hurricane Katrina inundated New Orleans, threatening to wash away its vibrant musical heritage along with its neighborhoods, the beat goes on. As Bronwyn Benito and Faith Lapidus report, a Musicians' Village is preserving the city's unique sound.
Video

Video In Russia, Auto Industry in Tailspin

Industry insiders say country relies too heavily on imports as inflation cuts too many consumers out of the market. Daniel Schearf has more from Moscow.
Video

Video Scientist Calls Use of Fetal Tissue in Medical Research Essential

An anti-abortion group responsible for secret recordings of workers at a women's health care organization claims the workers shown are offering baby parts for sale, a charge the organization strongly denies. While the selling of fetal tissue is against the law in the United States, abortion and the use of donated fetal tissue for medical research are both legal. VOA’s Julie Taboh reports.

VOA Blogs

World Currencies

EUR
USD
0.8978
JPY
USD
119.24
GBP
USD
0.6567
CAD
USD
1.3230
INR
USD
66.495

Rates may not be current.