Chaotic Libya appeals for help to restore security

| September 17, 2013

(Reuters) – Libya’s prime minister on Tuesday appealed to the outside world to help restore security, as it combats political chaos and tries to restart oil exports, crippled by protesters at a cost of $130 million a day in lost income.

Ali Zeidan met with his British counterpart David Cameron, who two years ago was a driving force behind a Western military campaign that helped topple Muammar Gaddafi and aimed to encourage a stable democracy in Libya.

That has yet to emerge. A combination of strikes, militias and political activists have blocked the majority of Libya’s oilfields and ports since end July but the government’s fledging army and police force are ill-equipped to deal with armed protesters.

“If the international community does not help in the collection of arms and ammunition, if we don’t get help in forming the army and the police, things are going to take very long,” Zeidan said at a Libya investment conference in London.

“The situation is not going to improve unless we get real and practical assistance.”

Zeidan insisted that he still wanted to solve the crisis through dialogue rather than force.

“We are going to work on solving this problem,” he said. “When blood is shed, the loss will be greater”.

Tripoli has had some success with the restart of its biggest south-western oilfield on Monday but the bulk of oil production in the east is still paralyzed.

The General National Congress’ crisis committee negotiated a deal with an armed group to allow the resumption of the El Sharara oilfield, which is expected to reach full capacity by Friday.

EXXON MOVE

But Western oil companies, which jostled for the chance to join Libya’s oil sector revival after the fall of Gaddafi, are losing faith.

ExxonMobil, the world’s largest publicly-traded energy company, said on Tuesday it would cut back its staff and operations there as growing instability no longer justified a major presence.

Royal Dutch Shell suspended drilling and abandoned exploration on two Libya blocks last year due to disappointing results and other firms have postponed exploration due to concerns about safety since the 2011 war.

Marathon is considering the sale of its stake in a key Libyan oil consortium, sources told Reuters in July.

Following the restart in the west, Libyan oil output is expected to rise to 400,000-450,000 barrels per day (bpd) compared with its pre-war capacity of around 1.6 million bpd, deputy oil minister Omar Shakmak said on the sidelines of the London event.

“Before Sharara (resumed production) it was around 230,000 bpd, now we’re expecting 400,000-450,000 bpd,” Shakmak said.

The field operated through a joint-venture with Repsol has a capacity of around 350,000 bpd, and flows were already starting to feed the 120,000 bpd Zawiya refinery, which has been running on alternative Brega oil from the east in recent weeks due to the shutdown.

Shakmak said the refinery was operating at around 70-80 percent of its full capacity.

The 130,000 bpd El Feel field, operated through a joint-venture with Italy’s Eni has not yet resumed output as checks still need to be made to some equipment before wells can be turned on again.

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Category: International

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