LIBYAN OIL production will not return to pre-war levels until late next year at the earliest, with many of the country’s oil facilities having suffered heavy damage and looting during the conflict, according to the newly appointed chairman of the country’s National Oil Company.
Offering the most detailed assessment yet of the outlook for Libya’s oil output, Nuri Berruien said it would be late 2012 or early 2013 before the country was again producing the 1.6 million barrels a day it had before the uprising.
While some production from Libya’s eastern fields should begin this month, the “initial oil output will be measured in the 10,000s of barrels a day rather than in the 100,000s of barrels a day”, Mr Berruien said. “In 15 months we can reach the prewar level of 1.6 million barrels a day.” The return of Libya to the global oil market is critical to crude prices, which surged this year with Brent hitting a two-year high above $125 a barrel.
Saudi Arabia has ramped up production to offset the shortfall while the International Energy Agency, the western countries’ oil watchdog, co-ordinated a release of emergency reserves. Brent crude prices are now about $112.
Mr Berruien’s appraisal sits between the most optimistic estimates by oil executives, who put the recovery in weeks, and assessments by consultancies that it could take three years.
The state of Libya’s oil facilities remains challenging. Oilfields and terminals had been heavily mined while camps for oil workers and service providers were looted, Mr Berruien said. The main concern was the state of the export terminals, with three of the ports in the east changing hands several times.
The Brega terminal had been badly damaged by pro-Gadafy forces and struck by Nato bombs. – Copyright The Financial Times Limited 2011