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August 12, 2021

Shell discusses resumption of Libya operations

Shell is considering the possibility of starting exploration, refinery and other operations in Libya, whose oil infrastructure requires upgrades.

By MEED   

UK/Dutch Shell is considering resuming operations in Libya, according to a statement published by the North African country’s National Oil Corporation (NOC).

A team from Shell met NOC chairman Mustafa Sanalla recently to discuss the possibility of new exploration operations, refinery projects, midstream projects and renewable energy opportunities.

“The meeting discussed the possibility of Shell … contributing to the development of fields in Libya, as well as increasing its activity in marketing and developing refineries,” NOC said in a statement.

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The meeting with Shell, which took place on 3 August, is the latest in a series of meetings held by Libya’s NOC with western energy companies as it looks to increase its production capacity.

Libya is likely to struggle to hit its ambitious oil production target this year as the country remains politically fragile, its oil infrastructure requires significant upgrades and global contractors continue to be hampered by the disruption caused by the Covid-19 pandemic.

In early June, Libya’s Oil Minister Mohamed Aoun said the country aims to increase oil production to 1.5 million barrels a day (b/d) by the end of the year, up from less than 1 million b/d in April.

Also in June, NOC’s Sanalla said his organisation planned to increase the country’s oil production capacity to 2.1 million b/d over the next few years.

Libya has frequently surprised its doubters and managed to ramp up production and exports in difficult conditions in the past.

But as planned elections approach in December, it looks increasingly unlikely that the required agreements will be put in place to ensure production capacity is increased sufficiently.

This article is published by MEED, the world’s leading source of business intelligence about the Middle East. MEED provides exclusive news, data and analysis on the Middle East every day. For access to MEED’s Middle East business intelligence, subscribe here.

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