Operations Resume at Libya’s Oil Facilities Amid Guards Protest

Flows of gas from Libya to Italy and production at Libya’s Wafa field resumed on Monday after being shut down last week by protesting Petroleum Facilities Guard (PFG) forces over non-payment of salaries. 

On Sunday, Libya's interim prime minister Abdulhamid Dbeibah approved a decision to increase salaries for PFG forces, responsible for the security of the country’s oil and gas facilities.  

Last week, the PFG announced the closure of oilfields, valves and pipelines across the country, with various PFG groups coordinating efforts in protest over Dbeibah’s failure to meet their demands. 

One of the key demands was an increase in salaries. The PFG gave the interim prime minister of LIbya’s UN-recognized Government of National Unity (GNU) 10 days to meet demands or face closure of oil facilities. 

The PFG had closed down production at the Zawiya refinery and the Mellitah complex, along with their ports, and shut down the Green Stream pipeline feeding gas to Italy. They also shut down the El-Feel and Al-Wafa fields, and threatened to gradually terminate operations at Libya’s largest oilfield, Sharara. The Wafa field was closed down on Sunday and reopened on Monday. 

Wafa produces up to 45,000 bpd. 

The temporary closure had caused the Libyan dinar to plunge against the U.S. dollar in black market trading to its lowest point in nearly a decade, according to Libyan media reports. 

In 2017, Libya said it was targeting 2.2 million barrels per day of production by 2023. Even though Libya has the largest proven oil reserves in Africa, with oil accounting for almost 100% of government revenues, political instability has hijacked production potential, with rival governments and militias competing for control of the country’s oil wealth.

In January, Libyan production was at 1.02 million barrels per day, according to the Platts OPEC Survey from S&P Global. 

By Charles Kennedy for Oilprice.com

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