Libya awards new oil and gas blocks to Chevron Eni and others in the first licensing round since 2007.
Libya awarded oil and gas exploration blocks on Wednesday to foreign oil companies including Chevron Eni QatarEnergy Repsol, in its first licensing round for nearly 20 years. The country is trying to revive the sector despite political divisions.
The National Oil Corporation announced the winners of their first round of bidding since 2007. They allocated key acreage in the Sirte, Murzuq and offshore blocks of the Sirte basin.
Foreign investors had been wary of Libya's operating conditions after the 2011 overthrow Muammar Gadafi, but now they are showing renewed interest.
Force majeure is often declared at the country's most important oil fields due to disputes over central bank revenues and the oil revenue.
Five of the 20 blocks were awarded in this licensing round. This follows a deal signed last month for a 25-year development agreement with France's TotalEnergies, and ConocoPhillips.
Massoud Suleman, Chairman of National Oil Corporation, told reporters that differences?over drilling obligations and participation stakes prevented several blocks from being awarded in the most recent licensing round. Massoud Suleman told reporters that the results of the latest licensing round would be used to align future contract terms with the global markets.
Suleman said that there may be additional negotiations on areas where no bids were received in this round.
Eni and QatarEnergy have secured the rights to Offshore Area 01 within the Sirte Basin, strengthening their strategic partnership that has spread across the Mediterranean.
Offshore Area 07 was also won by a separate consortium consisting of Repsol, Hungary’s MOL, and Turkey’s state-owned TPOC.
Chevron has secured the Sirte S4 licence for exploration, a return to Libya’s most prolific onshore area.
Aiteo, a Nigerian oil company, won the M1 licence in the Murzuq basin of the south. This is a rare opportunity for an African independent to enter the upstream sector.
The inclusion of Turkey’s TPOC in a separate?licence, including the C3 onshore block with Repsol highlights ties between Ankara, and Tripoli, the?base of the internationally recognised Government of National Unity headed by Prime Minister Abdulhamid Dbeibah.
QatarEnergy’s entry in the offshore sector along with Eni could indicate Libya is possibly seeking to?tap Doha’s gas expertise, as the country seeks to boost its gas exports to Europe before 2030.
The round replaced the rigid terms that had previously discouraged investment with a more flexible contract model. Libya is targeting a capacity of 2,000,000 barrels per day (bpd), up from the current output of 1.4,000,000 bpd.
Repsol said in a press release that Libya is a country of priority in its portfolio. The company sees potential in the country through investments in exploration and production enhancements, as well as infrastructure optimization. Reporting by Ahmed Elumami, Writing by Yousef SABA Editing by Bernadette B. Baum and Jane Merriman
(source: Reuters)
