Libyan Oil Minister Cleared of Smuggling, Mismanagement Allegations

Libyan Oil and Gas Minister Mohamed Aoun has resumed his position after being removed from duty in early April pending an investigation into oil smuggling and mismanagement allegations, the Libyan Herald reports, citing the Ministry’s social media accounts. 

“His Excellency the Minister of Oil and Gas Eng. Mohamed Mohamed Aoun began this morning his duties at the Ministry of Oil and Gas’’, the Ministry said in its announcement, adding that the investigation into Aoun’s activities had been concluded. 

Aoun was suspended on March 25 for what alleged mismanagement, with Deputy Oil Minister Khalifa Abdul Sadiq, interim Tripoli-based prime minister AbdulHamid al-Dbeiba’s nephew, replacing him. 

At the time, S&P Global speculated that the move was politically motivated and “unlikely to be undone”. 

"On the one hand, the suspension could unblock progress on major oil projects -- Aoun was behind a halt to the development of the NC7 Hamada field on the basis that it granted excessive concessions to foreign operators," S&P Global cited Hamish Kinnear, senior Middle East and North Africa analyst at Verisk Maplecroft, as saying back in March. "On the other hand, Aoun retains the support of parties with the ability to disrupt Libya's oil and gas production,” he added. 

Two months into the suspension, however, the official account is that Aoun has been returned to his position and the investigation is over, which could suggest that Aoun has agreed to cooperate where earlier he had been reluctant.  

Earlier this year, Aoun said that Libya–home to Africa’s largest proven oil reserves–required $17 billion in investments over the next three to five years in order to boost production to 2 million barrels per day, from less than 1.5 million bpd. 

Developing the country’s reserves is hindered by intense political rivalry that has led to a standoff between the Tripoli-based Government of National Unity and the Benghazi-based Eastern government in the stronghold of General Khalifa Haftar. Both rivals and their various militias and factions are competing for control of the country’s vast oil wealth. 

By Josh Owens for Oilprice.com

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