Libya oil output dives after key field shut

Oil output drops to 230,000 barrels a day as the el-Sharara field is forced to close down due to security conditions.

The oil crisis has already cost Libya more than $10bn in losses [Reuters]

Libya’s oil production has fallen to 230,000 barrels a day from 570,000 bpd due to the closure of the el-Sharara field following protests, state-owned National Oil Corp (NOC) said.

“The country’s oil production has fallen to 230,000 bpd after the closure on Thursday evening of the oilfield at el-Sharara,” which has an output of 330,000 bpd, NOC spokesman Mohamed al-Harairi said on Sunday.

Harairi added that the field had to shut down because “protest movements near the… wells no longer ensure the optimal security conditions,” without giving further details.

It was repeatedly shut down by protesters as a way to pressure the weak central government into political and financial demands.

Relaunch of production at el-Sharara in early January had pushed Libya’s output up to 570,000 bpd, when protesters in the area lifted their blockade of the site.

It was considered as a victory for Prime Minister Ali Zeidan as he struggled to end another protest that blockaded three eastern oil terminals since August.

El-Sharara is run by Akakus, a joint venture between the NOC, Spanish company Repsol, France’s Total and Austria’s OMV.

The drop is the latest blow to the oil-rich but strife-hit North African nation, where the oil sector accounts for 70 percent of GDP, 95 percent of state revenues and as much as 98 percent of exports.

Production stood at around 1.4 million bpd until the middle of 2013 when the protests began to break out at the country’s major ports in the east.

The oil crisis has already cost the country more than $10bn in losses, according to estimates from the oil ministry and the World Bank.

Three years after the revolt that toppled Muammar Gaddafi, Libya’s oil infrastructure is often targeted by protests, shutdowns and strikes by brigades of former rebels who refuse to disarm or recognise the state’s authority.

Source: News Agencies