Libya NOC 'Re-Merger' Seen as Positive
Libya’s state-owned National Oil Corporation (NOC) has agreed to merge with its eastern Libya counterpart and signalled its intent that its future headquarters be in the eastern city of Benghazi.
It’s seen as a positive move towards the restoration of operations, which have been heavily disrupted during the past two years by fighting among clans and attacks by Islamic State militants. This also follows the installation of a Government of National Accord in Tripoli on March 30 2016.
NOC issued a statement July 2 saying that its chairman Mustafa Sanalla, and his counterpart appointed by the government in Bayda, Nagi el-Maghrabi, had agreed that day to “unify the National Oil Corporation.” It added that Sanalla would remain chairman, while el-Maghrabi would join its board.
“There is only one NOC, and it serves all Libyans,” said Sanalla: “This agreement will send a very strong signal to the Libyan people and to the international community that the Presidency Council is able to deliver consensus and reconciliation. I’m sure it will now build on this success to bring unity and stability to other government institutions.”
“We made a strategic choice to put our divisions behind us and to unify and integrate NOC as directed by the House of Representatives and the Chairman and Members of the Presidency Council,” said Dr el-Maghrabi. “There is no other way forward. This is for the good of Libya.”
The merger agreement “recognizes the Presidency Council as the highest executive authority in the country, and the House of Representatives as the highest legislative authority. NOC will submit periodic reports to committees established by both authorities.” NOC also undertakes “to ensure Libya’s oil wealth is for all Libyans and all Libyans must benefit from it without exception, in accordance with the guidance issued by the House of Representatives and its President.”
The two sides said they jointly agreed a unified budget for the remainder of the current financial year and took steps to address any imbalances resulting from the period of division. They added: “The agreement makes infrastructure rehabilitation a priority, especially in the city of Benghazi in preparation for the relocation of NOC’s new headquarters; the parties expressed a strong desire that the NOC board should meet regularly in Benghazi in the interim if security conditions permit.”
Both men in May had signed a memo of understanding, recommending a re-merger of NOC.
Meanwhile Italy’s Undersecretary of State for Foreign Affairs Vincenzo Amendola (shown below on left) went to Tripoli for a one-day visit July 3 during which he met Prime Minister Fayez Serraj (below on right), along with other ministers and separately Martin Kobler, UN Special Representative and Head of its Libya Mission.
Italy said Amendola’s visit followed the April 13 state visit by its Foreign Minister Paolo Gentiloni and “represents an important stage in the process to reactivate the bilateral partnership between the two countries.”
All of Libya’s gas exports go to Italy. In May, Eni gave the go-ahead for a substantial investment in the country’s offshore gas, by awarding a contract for the Bahr Essalam Phase II development.
Libya Herald reported in late May that NOC had completed routine maintenance at the Wafa offshore field, Sabratha offshore oil platform and the Mellitah gas process complex – all part of a joint venture with ENI.
Italian imports of Libyan gas at 7.11bn m3 in 2015 were almost on a par with those from Algeria (7.24bn m3), and Libyan gas flows via the Mellitah plant to Italy have largely flowed normally since.
However NOC needs to improve supplies to its domestic power plants of associated gas from its onshore oil fields – including those run by its joint venture with Wintershall – which have been halted or disrupted by the fighting. More significantly for export revenues, two of the country's main oil export ports are reportedly still closed.
Mark Smedley | www.naturalgasafrica.com | www.naturalgaseurope.com