Tripoli, 27 July 2012:
With oil production . . .[restrict]almost back to pre-revolution levels, most foreign oil companies working here are moving to boost their own production further. The exceptions are Shell, which announced its intention to hold off a return to its Libyan licences at precisely the same moment as BP signalled it was restarting operations here, and Germany’s RWE, who are likewise holding back of an resumption of their Exploration and Production (E&P).
Wintershall, wholly-owned by BASF,the world’s largest chemical company, has cited Libya as key to its improved profit forecast for 2012. Chief Executive Officer of BASF, Kurt Bock, said: “Our forecast is especially supported by the resumption of our crude oil production in Libya.” Wintershall, has now raised production of crude oil to nearly pre-Revolution quantities.
The company suspended Libyan production between February and October 2011. However Libyan employees maintained and looked after oil field sites throughout this time. Production restarted in October at 20,000 bpd, but has now reached 80,000 bpd. Before the revolution Wintershall was lifting around 100,000 bpd in Libya.
A spokesperson for Wintershall, Verena Sattel, told Libya Herald: “In the second quarter, daily production has been 80,000 barrels per day on average. We want to stabilise the production capacity at this rate in 2012.”
One of the bottlenecks in the export infrastructure has been in the pipeline system, some of which is 50 years old. Sattel said: “The export infrastructure also needs to be in place. That’s why Wintershall is currently cooperating with the Libyan NOC and AGOCO to ensure a pipeline from Nafora to Amal becomes fully operational again. This is scheduled to be completed at the beginning of 2013.”
The British multinational oil and gas company BP has lifted the temporary suspension on its 2007 exploration and production contract with NOC. It is now restarting activities in its two exploration blocks, one onshore and one offshore, in the Sirte Basin. BP has said it could spend up to $20 billion dollars in the country over the next decade.
Spanish oil and gas company Repsol has also announced an unexpected rise in second-quarter profits, partly due to a higher output from Libya.
In contrast, Shell and RWE are less enthusiastic about the contribution of Libyan oil to their profits. Shell announced last month that it is halting both exploration and drilling operations in two blocks following disappointing results.
Germany’s RWE has postponed restarting work in Libya because financial agreements with NOC had yet to be reached. RWE conducted explorations in Libya between 2003 and 2010, making eight discoveries at blocks NC 193 and NC 195. Development plans with NOC were interrupted by the Revolution.
Deputy Oil Minister Omar Shakmak told Reuters that Libya’s current output was 1.56 million bpd but that this should have risen by October. Shakmak said: “If everything goes as planned and there are no more interruptions, I think within three months time from now … we hope we will achieve the 1.6 (million bpd).” [/restrict]