WASHINGTON: Libya is resuming oil exports from some of its main ports which forces loyal to eastern commander Khalifa Haftar seized in recent days and has lifted related “force majeuere” contractual clauses, the National Oil Corporation (NOC) said on Thursday. The north African nation is highly dependent on hydrocarbon revenues and needs oil exports to resume to save its economy from collapse. Conflict since Libya’s 2011 uprising has reduced its oil output to a fraction of the 1.6 million barrels per day the OPEC member once produced.
“Exports will resume immediately from Zueitina and Ras Lanuf, and will continue at Brega … exports will resume from Es Sider as soon as possible,” NOC Chairman Mustafa Sanalla said. He said Libya’s U.N.-backed government in Tripoli and a parliament based in eastern Libya both backed reopening the ports which have been controlled by forces loyal to Haftar since Sept 11-12. Haftar has been an outspoken opponent of the Government of National Accord (GNA) in Tripoli, and his seizure of the four ports from a rival force aligned with the GNA had raised fears of fresh conflict over Libya’s oil resources.
“NOC is in charge of the ports,” Sanalla said on Thursday, a day after visiting Zueitina. “They are secure, and we have been in contact with our foreign commercial partners.” A Reuters reporter at Zueitina saw large numbers of military vehicles and men belonging to a guard force allied to Haftar’s Libyan National Army (LNA).
Western powers had condemned Haftar’s seizure of the ports and had said they were ready to prevent any exports attempted outside the GNA’s authority. “(This) had the potential to escalate, with potentially devastating consequences for the nation and our petroleum industry,” Sanalla said. “Instead, we have found a shared interest in letting the oil flow, and the wisdom of that decision needs to be recognized.” U.S. Libya envoy Jonathan Winer called reports of the LNA handing over control of the ports to the NOC a “promising development”, writing on Twitter that increased oil production could have an “immediate positive impact”.
Libya could raise output to 600,000 barrels per day (bpd) within a month and to 950,000 by the end of the year from about 290,000 currently, Sanalla said this week, but he said NOC would need new funds and blockaded pipelines in southwest Libya would need to be reopened. Declaring “force majeuere” allows an oil supplier to break a contract because of circumstances beyond its control.
