Port blockade could cost Libya $67.4mn daily revenue loss

Business Monday 02/July/2018 13:30 PM
By: Times News Service
Port blockade could cost Libya $67.4mn daily revenue loss

Tunis: Libya's National Oil Corporation (NOC) said on Sunday that a port blockade by eastern authorities could result in losses estimated at 850,000 barrels per day (bpd) of crude oil and daily revenue of $67.4 million.
Operations at the ports were blocked after the eastern-based Libyan National Army (LNA) announced last Monday that it would no longer let the Tripoli-based NOC export from them.
The standoff is part of a broader conflict in Libya and has raised the prospect of a prolonged output drop from the Opec member, which had recently been pumping more than one million bpd.
Two terminals, Ras Lanuf and Es Sider, were shut by fighting involving the LNA last month. The NOC had said blockades would likely oblige it to declare force majeure at two other terminals, Hariga and Zueitina, on Sunday, but it has yet to do so. The LNA also controls a fifth port, at Brega.
However, it warned in a statement that if force majeure was declared this would "have significant short and long term consequences for NOC affiliate companies, the national economy and the Libyan people".
In addition to the crude oil losses, the NOC said output of natural gas used for local power supplies and oil and gas field operations would fall by 710 million standard cubic feet per day, and that more than 20,000 bpd of condensate would be lost.
"The power generation at the Zueitina and North Benghazi power stations will be badly affected," the NOC said.
"The corporation is already facing a deficit in the fuel import budget and will not be able to compensate the lost gas due to the shutdown by importing more liquid fuel from abroad."
To keep power plants operational, the NOC said it would have to burn valuable condensate, "resulting in significant negative environmental impact".
Displacing high-wax crude from the Abu Attifel to Zueitina pipeline would require one million barrels of water and additional chemicals, and Waha Oil Company pipelines could be corroded by the stoppage, the NOC said.
Once stored crude was used, refineries at Brega, Sarir and Tobruk would be forced to close, the statement said.