Libya’s NOC declares force majeure on El Sharara oilfield

TRIPOLI (Reuters) – Libya’s state oil firm NOC has declared force majeure on operations at the country’s largest oilfield, El Sharara, a week after it announced a contractual waiver on exports from the field following its seizure by protesters.

FILE PHOTO: A general view of the El Sharara oilfield, Libya December 3, 2014. REUTERS/Ismail Zitouny/File Photo

The 315,000 barrels a day field, located in the south of the North African OPEC member country, was taken over on Dec. 8 by groups of tribesmen, armed protesters and state guards demanding salary payments and development funds.

Officials have been unable to persuade the groups, who have been camping on the field, to leave the vast, partly unsecured site amid disagreements how best to proceed, workers on the field said.

Some government officials favor offering quick cash to the occupiers to make them leave, but NOC officials have warned that would set a precedent and encourage more blockades, workers at the oilfield say.

NOC has described the occupiers as militia trying to get on the payroll of field guards, a recurring theme in Libya where many see seizing NOC facilities as an easy way to get heard by the weak state authorities.

Production will only restart after “alternative security arrangements are put in place”, NOC said in a statement late on Monday.

Operations at the smaller El Feel oilfield continued as normal, engineers said.

“Production at Sharara was forcibly shut down by an armed group – Battalion 30 and its civilian support company – that claimed to be providing security at the field, but which threatened violence against NOC employees,” NOC Chairman Mustafa Sanallah said in the statement.

His comments came after the chief of staff of the Tripoli-based government, Abdulrahman Attweel, criticized some of Sanalla’s previous comments about the protesters as “irresponsible”.

“These people (guards) were there to protect the field without salaries and without any attention to them and their daily needs, not in terms of accommodation, supply, transportation and communication,” Attweel told al-Ahrar channel late on Monday.

Their demands were legitimate, he said, echoing comments by some southern lawmakers and mayors demanding more jobs and development for the neglected region.

The blockade has been complicated by the presence of tribesmen, who have argued against quick cash payments saying they want funds to improve hospitals and other services, which might take time to deliver.

El FEEL

The shutdown of the El Sharara has not affected the El Feel oilfield, also located in the south. It continued to pump around 70,000 barrels a day, field engineers said.

Its exports were being routed via the Melittah oil and gas port, which like El Feel belongs to a joint venture NOC has with Italian energy company Eni, another engineer said.

A spokesman for NOC did not respond to a request for comment.

El Sharara crude is normally transported to the Zawiya port, also home to a refinery. NOC runs the field with Spain’s Repsol, France’s Total, Austria’s OMV and Norway’s Equinor, formerly known as Statoil.

Reporting by Mohamed El-Sherif, Ayman al-Warfalli, Ahmed Elumami and Ulf Laessing; Editing by Jason Neely and Susan Fenton

Our Standards:The Thomson Reuters Trust Principles.

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