Protesters affiliated with the “No to Corruption” movement in western Libya are planning to disrupt gas supplies to Italy from the Mellitah oil complex, according to Italy’s news agency NOVA.
The complex is set to witness a protest on Tuesday, demanding the removal of the Chairman of the National Oil Corporation (NOC), Farhat Bengdara.
The demonstration is scheduled at the Mellitah oil and gas complex, the sole facility exporting Libyan gas to Italy through the “Green Stream” pipeline. Protesters are threatening to shut down the complex within “three days” if their demands, particularly the removal of Bengdara, are not met.
The anticipated protest follows the controversy in Libya over negotiations between the OC and a foreign consortium led by Italy’s Eni. The coalition includes the UAE’s Adnoc, France’s Total, and the Turkish Energy Corporation. Their negotiations aim to develop the Hammada oil field, south of Tripoli.
Libya’s Prime Minister, Abdel-Hamid Dbaiba pledged to consider all reservations regarding the agreement, but emphasized the need to boost oil and gas production through foreign and domestic investments.
Italy receives up to 10 billion cubic meters of Libyan gas annually through the Green Stream, connecting Sicily to Libyan gas fields. However, Libyan gas production decreased by 8% in 2022. The total exported Libyan gas to Italy through Green Stream was 2.48 billion cubic meters, equivalent to 10% of the estimated total production of 24.4 billion cubic meters, according to the Audit Bureau in Tripoli.
The potential protest’s backdrop includes the “force majeure” status declared by the Corporation on crude oil shipments from Libya’s largest field, the Sharara, producing around 270,000 barrels per day. The closure on 3 January disrupted oil supplies to the Zawiya port. Negotiations are underway to resume production as soon as possible.
Notably, the NOC declared a state of force majeure at the Sharara field, effective Sunday, 7 January, due to the protests.
This significant development comes as a direct consequence of the field’s shutdown, instigated by sit-in demonstrators, leading to a halt in production. The field, a major source of revenue for the country, has been a frequent target of protests and blockades, reflecting ongoing regional and political tensions within Libya.
The declaration of force majeure, a legal term used by companies to relieve them from contractual obligations due to circumstances beyond their control, underscores the severity of the situation and its potential impact on Libya’s oil output and economic stability.
The NOC’s announcement is expected to have substantial implications for the Libyan oil industry, which is a critical component of the national economy, and a significant player in the global oil market. This disruption at Sharara poses challenges not only for Libya’s domestic financial stability, but also for international oil prices and supplies.
As the situation unfolds, further updates and responses from both Libyan authorities and international stakeholders are anticipated in the wake of this major disruption in the country’s oil production.