NOC protests over Qatar's role in rebel oil sales

April 25, 2011
The chairman of Libya's National Oil Corp. sent a letter of protest to the Organization of Petroleum Exporting Countries about the help fellow member Qatar is giving to Libyan rebels with sales of oil.

Eric Watkins
Oil Diplomacy Editor

The chairman of Libya's National Oil Corp. sent a letter of protest to the Organization of Petroleum Exporting Countries about the help fellow member Qatar is giving to Libyan rebels with sales of oil.

In the letter, NOC Chairman Shokri Ghanem described as "very unfortunate" Qatar's efforts to market Libyan oil and purchase fuel on behalf of the forces opposed to the rule of Libya's ruler Moammar Gadhafi.

Qatar has so far sold 1 million bbl of oil on behalf of Libya's opposition Interim National Council (INC) and has delivered four shipments of petroleum products to the country's eastern port of Benghazi.

Qatar's state news agency said the move was taken according to the directives of Qatar's ruler Emir Sheikh Hamad bin Khalifa al-Thani "to ease the suffering of the Libyan brethren and to meet their humanitarian needs (OGJ Online, Apr. 13, 2011)."

Ghanem's letter coincided with reports that Libya's rebels are unlikely to export any more oil until they are able to resume production but that they remain in touch with potential buyers.

The rebels control fields owned by the Arabian Gulf Oil Co. (Agoco), including Nafoora, Misla, and Sarir, which have a combined potential production capacity of about 400,000 b/d, according to a rebel spokesman.

Wahid Bugaighis, who was appointed head of national oil company established by INC to sell oil produced in rebel-held areas, said the group still has contacts with potential buyers, but that nothing can be done until fields are back on stream. The rebel forces had to stop oil production after forces loyal to Gadhafi attacked Agoco's Misla field in early April, damaging its power generation system, an oil tank, some smaller diesel tanks, and other equipment (OGJ Online, Apr. 7, 2011).

The government attack on Misla came after the rebels arranged for the Liberian-registered MT Equator to sail from Marsa el Hariga on Apr. 6, with 130,000 tonnes of oil reportedly bound for Singapore.

Meanwhile, Bugaighis expressed the hope that production from the rebel-held fields would resume in a few weeks but that renewed output would depend on security, the extent of the damage and other factors.

Rebels are securing the fields under their control but are not working to bring any others online apart from Agoco's, Bughaighis said. He added that the rebel-held fields are secure in terms of essential infrastructure and personnel.

Opposition forces are still in contact with potential buyers, both those who had purchased oil from Libya before and possible first-time customers. But he declined to name any specific possible buyers.

The Libyan opposition wants to resume oil production and sales to pay salaries and meet other expenses in the effort oust Gadhafi, who is fielding better-armed and trained troops against the rebels.

Bugaighis said Libya's new leadership would try to end corruption in the country's oil industry and that it might also reconsider some of the production policies establish under the Gadhafi regime. He said officials especially want to reconsider the policy established 3-4 years into the Gadhafi regime of always producing the maximum amount of oil regardless of whether it was sustainable or not.

Bugaighis, who does not expect to remain head of the NOC if Gadhafi is removed, said his role at the moment is to ensure that production and export resume as soon as possible in the rebel-held areas.

Meanwhile, UN chief Ban Ki-moon called for an immediate ceasefire and a political solution to the conflict in Libya and said the UN would open a humanitarian mission in Tripoli.

"We have three objectives: first, an immediate, effective ceasefire; second, to extend our humanitarian assistance to the needy; third, we have to continue to have a political dialogue and a political resolution to the issue," Ban said.

"Once a ceasefire is reached, Libya will need wide-ranging efforts in peace-making and peace-keeping as well as reconstruction," he said. Ban's remarks followed earlier claims by rebels that they have advanced to the outskirts of the key oil town of Brega, helped by North Atlantic Treaty Organization airstrikes on Gadhafi's forces.

On Apr. 16, opposition fighters said they had held their positions around the city of Ajdabiya, about 30 miles to the east, and had pushed further west to Brega's university campus, just outside the town's oil port. Brega has changed hands around half a dozen times since March and a rebel officer said if the opposition retakes it, they will bring engineers to repair any damage to the town's refinery and oil facilities.

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