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Big Oil Doubles Down On Shale Despite Price Drop

Big Oil Doubles Down On Shale Despite Price Drop

Despite depressed crude oil prices…

Libya Declares Force Majeure On Another Oil Port

oil export terminal

Just a few days after Libya reopened its eastern oil ports and started to ramp up production that had been offline for weeks, the National Oil Corporation (NOC) declared force majeure on crude oil loadings at the Zawiya port in the west, following a weekend attack and abduction of oil workers at the Sharara oil field that had cut production at the site to 125,000 bpd.

Production at one of the country’s largest oil fields, Sharara, was expected to drop by 160,000 bpd after oil workers were abducted on Saturday and oil wells closed as a precaution, the NOC said on Saturday.

Early on Saturday, unknown armed assailants entered the facilities of the Sharara oil field and kidnapped four of the staff, but two of them have been since released, the national oil company said then.

The company operating the field, Akakus—a joint venture of NOC and a consortium consisting of Total, Repsol, Equinor, and OMV—is closely monitoring the situation.

“Oil wells in the surrounding area have been shut down as a precaution, and all other workers evacuated. Expected losses to daily production are 160,000 barrels a day,” the NOC said on Saturday.

On Tuesday, following the cut in production at the Sharara oil field, which had pumped around 300,000 bpd before the kidnappings, NOC said that it had declared force majeure at the Zawiya port effective Monday, July 16.

“Field production is limited to 125,000 bpd – enough to meet the requirements of the Zawiya Refinery, but leaving no excess crude for export,” NOC said on Tuesday.

Related: Goldman: Brent To Retest $80 This Year

“Employee safety is always our first priority. This incident required us to shutdown and evacuate a number of stations. We have to prioritize local demand for fuel. For the time being all Sharara production will go to the refinery,” NOC chairman Mustafa Sanalla said.

According to a loading plan obtained by Bloomberg, the Zawiya port was scheduled to ship 6.93 million barrels of crude oil this month.

Last week, NOC had lifted the force majeure on four ports in the eastern part of the country, and production was ramping up after the export terminals were handed over to the Tripoli-based internationally recognized Libyan oil company.

By Tsvetana Paraskova for Oilprice.com

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