Libya oil output makes high-stake but fragile return

Libya oil output makes high-stake but fragile return
Oil-rich Libya has been torn apart by civil war since the NATO-backed uprising that ousted long-time dictator Muammar Qaddafi in 2011, with an array of militias filling the vacuum and civilian bodies struggling to impose their authority. (File/AFP)
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Updated 24 January 2021

Libya oil output makes high-stake but fragile return

Libya oil output makes high-stake but fragile return
  • Libya’s is now producing 1,224 million bpd, a tenfold increase from a 121,000 bpd average in the third quarter of 2020
  • Demand for crude has sunk under the impact of Covid-19 and producing nations have been adjusting output to support prices

TRIPOLI, Libya: Oil cartel OPEC saw production rise in December, as Libya’s energy sector sprang back to life following a cease-fire deal in the war-torn country.
Sitting atop Africa’s largest proven crude oil reserves, Libya has been ravaged by conflict since a 2011 NATO-backed uprising that toppled and killed long-time dictator Muammar Qaddafi.
As global oil prices remain volatile in the midst of the novel coronavirus pandemic, which has rattled the world economy, and further rounds of UN-backed peace talks to build on the October cease-fire and resolve Libya’s long conflict, what are the prospects for the country’s production?
Libya’s is now producing 1,224 million barrels per day (bpd) — a tenfold increase from a 121,000 bpd average in the third quarter of 2020, before the cease-fire deal.
But that is still below the levels of the Qaddafi era, said Francis Perrin, head of research at the Paris-based Institute for International and Strategic Affairs.
Libya was then producing between 1.5 million and 1.6 million barrels per day, he told AFP.
Demand for crude has sunk under the impact of Covid-19 and producing nations have been adjusting output to support prices.
Libya’s surge has meant production for the Organization of the Petroleum Exporting Countries reached 25.36 million bpd in December, an increase of 278,000 bpd compared with the previous month.
Libya is exempt from OPEC’s production quotas, so the cartel needs to keep an eye on its output.
Libyan petroleum engineer Al-Mahdi Omar, however, said his country’s industry was “still in difficulty,” despite the spike.
“It’s a miracle that the oil sector continues to function despite the dilapidation and damage of infrastructure due to war, negligence or sabotage,” he said.
The oil and gas sector represents around 60 percent of Libya’s GDP.
In January last year, armed groups loyal to eastern strongman Khalifa Haftar blocked production and exports from Libya’s most important oil fields and terminals.
They demanded a “fairer” distribution of revenues, which are managed by the UN-recognized Government of National Accord in Tripoli.
The GNA is backed by Turkey, while Haftar is supported by Russia, the United Arab Emirates and Egypt.
Haftar agreed in September to lift the blockade, several months after the failure of an offensive by his fighters to take the capital.
The blockade resulted in lost revenues of almost $10 billion, the National Oil Corporation has estimated.
On October 26, just days after the cease-fire was agreed, the NOC said it had lifted force majeure — external unforeseen elements that prevent a party from fulfilling a contract — on the last oil facility in the country.
And while all Libya’s oil fields are back online, the NOC announced earlier this month that a pipeline had been closed for maintenance, causing a drop in production of around 200,000 bpd, Bloomberg reported.
“This gives you an indication that the infrastructure in Libya is really in bad shape,” Bloomberg quoted NOC chief Mustafa Sanalla as saying.
Perrin said there was scope for further improvement to Libya’s oil production, “but not immediately.”
“In the short term, if it manages to maintain its current levels, that would be very good,” he said.
“The main uncertainty is political.”
Lifting the blockade has allowed production and exports to rise since September, but “this is part of a temporary agreement, a truce — it’s not a peace deal,” Perrin warned.
The country is also seeking support from foreign oil companies to help repair its infrastructure, according to Bloomberg.
“We are now discussing with our partners how to finance and how they can help us,” it quoted the NOC chief as saying.
Libyan economist Nouri Al-Hammi said the country’s oil recovery remained “fragile.”
“Only fair revenue distribution and the creation of real development opportunities can settle the sector’s problems,” he said.
Distribution of oil revenues in Libya is a thorny issue and crucial to settling the conflict.
After a decade of war, the October cease-fire has set the stage for elections at the end of this year.
Resources-sharing between Tripoli and the east is “a key element of the discussions between the two parties... It could make or break the nascent truce,” Perrin said.
It is “a sword of Damocles that hangs over Libya’s oil production.”
Blockades of important sites will remain a constant threat to production “if discussions on revenue-sharing fail to reach a compromise,” he warned.
For engineer Omar, oil in Libya has been key ever since the discovery at the end of the 1950s of its reserves, the largest in Africa.
“It is at the heart of negotiations between the Libyan adversaries, but also between their foreign supporters,” he said.


Singapore’s central bank issues guidelines to discourage crypto public trading: Crypto moves

Singapore’s central bank issues guidelines to discourage crypto public trading: Crypto moves
Updated 11 sec ago

Singapore’s central bank issues guidelines to discourage crypto public trading: Crypto moves

Singapore’s central bank issues guidelines to discourage crypto public trading: Crypto moves

RIYADH: Bitcoin, the leading cryptocurrency internationally, traded lower on Monday, falling by 1.48 percent to $42,558 at 6:51 p.m. Riyadh time.

Ether, the second most traded cryptocurrency, was priced at $3,241 down by 3.14 percent, according to data from Coindesk.

Other news

The Monetary Authority of Singapore issued on Monday guidelines restricting cryptocurrency trading service providers from promoting their services to the general public, as part of an effort to protect retail investors from potential risks.

In the new guidelines, MAS asserts that companies should not engage in marketing or advertising of DPT services in public areas in Singapore or through third parties, such as social media influencers, to promote DPT services to the general public. They can only market or advertise on their own corporate websites, mobile applications or official social media accounts.

Singapore is a popular location for cryptocurrency companies due to its relatively clear regulatory and operational environment and is among the forerunners globally in developing a formal licensing framework.

The city state authorities have also repeatedly warned that trading in digital payment tokens or cryptocurrency, is highly risky and unsuitable for the general public, as they are subject to sharp speculative swings.

“MAS strongly encourages the development of blockchain technology and innovative application of crypto tokens in value-adding use cases” Loo Siew Yee, MAS assistant managing director of policy, payments and financial crime, said in a statement.

“But the trading of cryptocurrencies is highly risky and not suitable for the general public. DPT service providers should therefore not portray the trading of DPTs in a manner that trivializes the high risks of trading in DPTs, nor engage in marketing activities that target the general public.”

Mining 

Jack Dorsey, CEO of Block, said in a tweet that the fintech company is building an open bitcoin-mining system, as the newly rebranded company looks to expand beyond its payment business and into new technologies like blockchain.

In October, Dorsey said that Block, formerly Square, was considering building a bitcoin-mining system based on custom silicon and open source for individuals and businesses worldwide.

In a tweet thread on Thursday, Block’s general manager for hardware, Thomas Templeton, laid out the company’s plans to build the mining system.

“We want to make mining more distributed and efficient in every way, from buying, to set up, to maintenance, to mining. We’re interested because mining goes far beyond creating new bitcoin. We see it as a long-term need for a future that is fully decentralized and permissionless,” Templeton tweeted. 


Kuwait’s budget deficit 682 million dinars in 9 months

Kuwait’s budget deficit 682 million dinars in 9 months
Updated 17 January 2022

Kuwait’s budget deficit 682 million dinars in 9 months

Kuwait’s budget deficit 682 million dinars in 9 months

KUWAIT CITY: Kuwait’s oil revenue reached 11.5 billion dinars ($38.10 billion) in the nine months to the end of December, the Ministry of Finance said in a report on Monday.
The Gulf OPEC member recorded a budget deficit of 682.4 million dinars in the first nine months of its financial year, which ends in March 2022, the ministry’s preliminary report said.
($1 = 0.3019 Kuwaiti dinars)


Military-affiliated companies to be listed on the Egyptian bourse next year: PM

Military-affiliated companies to be listed on the Egyptian bourse next year: PM
Updated 17 January 2022

Military-affiliated companies to be listed on the Egyptian bourse next year: PM

Military-affiliated companies to be listed on the Egyptian bourse next year: PM

RIYADH: Some military affiliated companies operating in the economy and civil sectors are being restructured to be listed on Cairo's Stock Exchange next year, Egypt's Prime Minister, Mostafa Madbouly, said.

The companies will be available to all Egyptians, not just the private sector,  he added during his interview on a BBC program, citing President Abdel Fattah El Sisi’s statement. 

Soliman did not disclose the names of other companies affiliated with the Egyptian army that are planned to be listed, until the validity of their legal structures is verified. 

“We have offered more than 25 percent of the wholly state-owned e-finance company on the EGX, and many companies, including companies affiliated with the armed forces, are scheduled to be offered on the stock exchange next year,” Madbouly said.  

He added that the size of the armed forces' institutions represents less than 1 percent of the Egyptian economy.

Ayman Soliman, the CEO of the Sovereign Fund of Egypt had previously revealed the organisation was in the process of completing the legal restructuring of two affiliated companies, namely the Safi food company and the Watania petroleum distribution company, with both set to be listed on the stock exchange.


UAE’s Masdar wants to hit 200 GW with global renewable energy projects: minister

UAE’s Masdar wants to hit 200 GW with global renewable energy projects: minister
Updated 17 January 2022

UAE’s Masdar wants to hit 200 GW with global renewable energy projects: minister

UAE’s Masdar wants to hit 200 GW with global renewable energy projects: minister

RIYADH: UAE-owned renewable energy company Masdar wants to see its global projects produce up to 200 gigawatts of electricity, the country’s Industry Minister Sultan al-Jaber said on Monday in Dubai.

Al-Jaber, who is also the CEO of Abu Dhabi National Oil Company (ADNOC), was speaking at the Abu Dhabi Sustainability Week Summit at the Expo 2020 site in Dubai.

He said  Masdar has invested in wind and solar projects in 40 countries around the world, according to Reuters, adding: “Our ambition is to accelerate this development globally to reach 100 GW and ultimately double that again to 200 GW.”

No timeframe was set out for the growth, but last month the  Abu Dhabi government confirmed plans to increase Masdar's capacity to more than 50 gigawatts by 2030.


Tanmiah Food appoints Ahmed Osilan as managing director

Tanmiah Food appoints Ahmed Osilan as managing director
Updated 17 January 2022

Tanmiah Food appoints Ahmed Osilan as managing director

Tanmiah Food appoints Ahmed Osilan as managing director

RIYADH: Saudi-listed Tanmiah Food Co. will see executive board member Ahmed Sharaf Osilan take over as managing director for the ongoing term, which shall end on April 4, 2022.

The decision was approved by the company’s board of directors today, Jan. 17.  

The newly elected member, Osilan, will replace Muhammad Sajid Saeed.

Osilan holds a bachelor’s degree in industrial management, and has 20 years of experience in the investment field, having held many leadership positions in the past.

The Riyadh-based food company, which employs more than 1,500 people, has grown to become a major supplier of chicken products.

It operates a veterinary services unit and food processing business.