By Libya Herald reporters.
Tripoli, 18 July 18, 2017:
National Oil Corporation (NOC) chief Mustafa Sanalla will beRussia’s St Petersburg on Monday to tell OPEC and non-OPEC oil producers why Libya simply cannot afford to cut back on its rising oil output, even though global oil prices remain weak because of excess production.
At its Algiers meeting last November OPEC members agreed that Libya, along with Nigeria and Iran should be exempted from voluntary price-support cutbacks. But this year Libyan production has recovered strongly from an average of 300,000 bpd to in excess of a million bpd. This is ahead of the August target for the magic million that Sanalla set earlier in the year. It may be significant that while oil traders have been confirming the million plus figure for some days, NOC has not yet trumpeted the achievement.
Sanalla has been invited to the Joint Technical Committee by OPEC to share Libyas production plans. Most of the other OPEC and non-OPEC oil states will be represented at ministerial level.
The NOC chief put out a statement today saying that before he left, he would be consulting significant Libyan decision makers.
“ I hope to present a unified Libyan position in St Petersburg that will show we can act together in the national interest”.
He also said “ We will take this opportunity to share with the committee the factors enabling and constraining Libya’s production recovery”.
One of those factors is decayed and under-maintained infrastructure. Sanalla has been conducting a charm offensive with NOC’s existing and potential exploration and production partners, including BP, OMV, Statoil, Repsol and ENI to woo them back to Libya or have them expand their operations here.
Most recently he met top executive from Russian oil firms Rosneft and Tafneft. From both companies Sanalla is seeking investment in return for oil liftings. Tafneft was working in both the Ghadames and Sirte basins before it pulled put in 2014. It would seem very likely that the NOC chief will continue talks with both companies while he is in Russia.
Sanalla has said that he believes that OPEC should consider the social and economic impact of any production cuts it might urge on Libya. Before the Revolution the country was producing around 1.6 million bpd.