Libya to finalize gas deal with Eni for offshore gas development: NOC

Libya plans to finalize a deal with Eni to develop offshore gas fields as it refocuses on boosting its gas production and tapping some 80 Tcf of proven reserves, the chairman of state-owned National Oil Corp. said on Nov. 1.

"Currently we are in the process of signing an investment with Eni to produce gas offshore, and this is something around $6 to $8 billion [in investments]," Farhat Bengdara told reporters on the sidelines of the ADIPEC conference in Abu Dhabi.

"There is also a program of drilling offshore and onshore that will start soon by Eni and BP. We are in talks with TotalEnergies to invest more in Libya and increase production, and other companies of course," Bengdara added.

Eni could not be immediately reached for comment at the time of writing.

Libya wants to tap some 80 Tcf of proven gas reserves to boost its gas production and export it to nearby markets. Although Libya has a gas pipeline linked to Italy, there are ideas to have another pipeline from the east linked to Greece, in addition to having a pipeline linked to the Damietta LNG plant in Egypt, Bengdara said. Italy's Eni leads the SEGAS consortium that owns Damietta LNG.

"Even with expectations of increased domestic consumption . . . we will have a surplus from production [for export] and that's what we are working on," he added.

NOC is also in discussions with BP and TotalEnergies about swapping gas with renewables, whereby they invest in producing electricity for Libya in return for gas, Bengdara told an ADIPEC panel earlier, without elaborating.

Stable oil production

NOC is courting international oil companies to help boost its oil and gas production, which has languished amid political mayhem that saw oil production drop to 600,000 b/d during the summer.

Libya saw a 60,000 b/d recovery in output to 1.16 million b/d in September, according to the latest Platts survey by S&P Global Commodity Insights, as political tensions that led to the ouster of National Oil Corp. Chairman Mustafa Sanalla in July appear to have eased enough to allow oil operations at many blockaded fields to resume.

"Maybe in two weeks' time we will lift the force majeure on concession blocks, and this will give more opportunities to investors ... also, we will offer new concessions to those who are ready to meet our fiscal regimes," Bengdara told the ADIPEC panel.

"We are working on different investment models and fiscal regimes to give incentives for IOCS to come and invest in the country."

Libya, which currently has a stable oil production of about 1.2 million b/d, is looking to boost its oil production capacity to 3 million b/d in three to five years, he added

NOC is planning to invest around $4 billion this year in its operations, but next year's investments are expected to range between $12 and $15 billion alongside its partners, he said.

Source: S&P Global