Libya eyes progress on Eni-led oil and gas project
Libya intends to move ahead with a $4bn-5bn oil and gas project proposed by Eni, months after putting the project on hold because of widespread opposition.
The country's Supreme Council for Energy last month essentially cleared the way for block NC-07 to be awarded to a consortium of Italy's Eni, France's TotalEnergies, Abu Dhabi's Adnoc and Turkey's state-owned Turkish Energy after a technical review found Libyan institutions lacked the financial means to develop the project alone, according to leaked minutes of the meeting seen by Argus.
More recently, Turkey's energy minister Alparslan Bayraktar said on 19 April that an agreement on NC-07 was close. "We are about to sign," he said. On 16 April, Libya's acting oil minister Khalifa Rajab Abdulsadek signalled the project was still on the cards.
Eni did not comment. State-owned NOC could not be reached.
Tripoli-based prime minister Abdelhamid Dbeibeh and NOC had been on the cusp of awarding NC-07 to the Eni-led consortium in January before widespread opposition forced Dbeibeh to order a review addressing concerns. Plans envisage at least 200mn ft³/d of gas and an unspecified amount of oil.
The moves reflect a growing impetus by Libya's oil leadership to drive forward long-delayed projects as it seeks to boost oil production capacity from 1.2mn-1.3mn b/d to 2mn b/d and double gas output to around 3.5bn ft³/d over the next three to five years.
Libya is also set to begin negotiations with TotalEnergies and ConocoPhillips in Paris next month over their demand for better terms at Waha Oil Company in return for investing in expanding production capacity, an oil industry source told Argus. This is also likely to prove controversial as many in the industry and beyond are opposed to altering contractual terms.
The apparent fresh push comes just weeks after the ousting of oil minister Mohamed Oun, who had opposed awarding NC-07 to the consortium and rejected several other oil and gas deals pursued by the Tripoli-based government and NOC.
Opponents of the deal have said that the consortium was set to receive a share of production that is too high and that current operator state-owned Agoco could develop the field for a fraction of the cost. The oil ministry under Oun had also suggested that NC-07 could have been put to a public tender rather than be the subject of direct negotiations.
Proponents of the NC-07 deal said Libya must rapidly move ahead with projects to ensure domestic demand is met and the country can continue to export gas. The Supreme Council for Energy said Libya will face a severe gas shortage by 2026 on its current trajectory and become a gas importer unless development projects are implemented.
While Libya's political divisions persist, its oil sector has enjoyed a greater level of stability over the past two years. Forced production shutdowns have been few and far between while interest from international oil companies has grown. But accusations of improper conduct in the oil industry have increased in tandem.
One of the key challenges facing Libya's oil sector is project implementation. A landmark $8bn deal for Eni to develop offshore gas fields was signed in early 2023, but Argus understands that there has been little progress on implementation.
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