Libya set for crude exports as fields restart

Libya is poised to export a crude cargo from the Marsa el-Hariga port in the east of the country by the end of September, which would mark the first shipment from the terminal in eight months. It comes as some of Libya's onshore oil fields slowly resume production.

The Marlin Shikoku will load 1mn bl of Sarir/Mesla crude from Marsa el-Hariga on 24-27 September, according to shipping sources and Vortexa data. The cargo will likely come from storage, and its destination is not yet known.

China's Unipec will load the cargo, according to shipping and trading sources. Unipec was one of only two companies that loaded Mesla/Sarir crude last year, and had been set to remain the main term buyer of the grade this year.

No crude has been exported from Marsa el-Hariga since January, according to Argus tracking data. The port — along with all other oil terminals in eastern Libya as well as onshore crude fields in the west of the country — has been intermittently blockaded by allies of Khalifa Haftar's Libyan National Army (LNA) for the past eight months. During that time, Libyan crude exports have been mainly confined to shipments from the offshore Bouri and Al Jurf fields.

A new deal to resume oil production and exports was struck last week between the LNA and the rival UN-backed Government of National Accord (GNA). State-owned NOC subsequently agreed to restart activity at "safe" ports and fields where mercenaries are not present. The LNA-allied Russian military group Wagner and Sudanese Janjaweed forces have gathered around the Es Sider and Ras Lanuf terminals in recent weeks.

Shipping sources said at the weekend that Marsa el-Hariga and Zueitina are likely to be among the first ports to restart. The port of Marsa el-Brega was allowed to export cargoes of stored crude and condensate in early September, suggesting that it too could be deemed secure.

NOC subsidiary Agoco — operator of the Sarir, Mesla, al-Bayda, Nafoora and Hamada fields, which can produce as much as 300,000 b/d between them — said on 19 September that it is preparing to restart production. The Mesla field was online and producing roughly 30,000 b/d between 30 June and 3 September, but those supplies were earmarked for domestic refinery use. Output from Mesla was interrupted at the start of this month because of Covid-19 precautionary measures. Agoco has stressed the need for staff to abide by Covid-19 measures as output restarts.

Mellitah Oil and Gas, a joint venture between NOC and Italy's Eni, has resumed production at the al-Bury field, which was producing around 1,000 b/d before the blockades, and Sirte Oil has restarted the 30,000 b/d capacity Zelten field. Current production rates from the two fields is not clear.

While last week's agreement between the LNA and GNA has rekindled some of Libya's onshore crude production, the deal's long-term survival remains uncertain. The agreement was negotiated by Khalifa Haftar himself and GNA deputy prime minister Ahmed Maiteeq, but it has yet to be endorsed by GNA prime minister Fayez al-Sarraj — who said last week that he intends to resign by the end of October — or by Libya's House of Representatives, the country's legislative body.

By Ruxandra Iordache