Occidental Petroleum Corp. will be the first US-based oil and gas producer to resume operations in Libya, company officials said.
The company had to leave its operations in the prolific Sirte basin in 1986 when the US government barred US firms from doing business in Libya. Occidental already has “technical teams” in the country to assess the condition of its exploration and production properties. It should “not take too long” to resume operations, a spokesman told OGJ.
Occidental negotiated an agreement with Libya’s National Oil Corp., effective July 1, to resume operations under the terms of the previous “standstill agreement” that preserved its claim to the licensed properties. However, Occidental officials declined to say whether the company would pay the “return fee” previously demanded by NOC.
Production boost
Resumption of its Libyan operations will add net production of 12,000-15,000 b/d of oil to Occidental, officials said. It also “holds significant potential for future production growth” through investment in enhanced oil recovery.
Occidental’s assets in the Intisar-103 and Epsa fields now reportedly produce 85,000-100,000 b/d of oil, down from 660,000 b/d in 1970 and 155,000 b/d in 1986, said the US Energy Information Administration in a Feb. 25 report. Occidental proposed last December to invest $2 billion in developing those fields, EIA said.
Since Occidental left Libya, its producing properties have been operated by an NOC subsidiary. Although Occidental retained its contractual rights during the sanctions era, officials said, it derived no economic benefits from those operations. ✦
