Extreme Weather Causes Production Outages In Libya
A Libyan oil company has had to significantly reduce oil production at its fields because the hot weather has caused several turbines to stop working. The company is Agoco, a unit of the national Oil Corporation, and the decline in production amounted to some 120,000 bpd, sources wishing to remain unnamed told Bloomberg.
This is only the latest production outage in the troubled North African country that has made exemplary efforts to revive its oil production after the NOC regained control over the export terminals and the fields, and settled its disputes with the Petroleum Facilities Guard. It is also the least significant one, as according to the sources, production in Agoco’s fields will return to normal in a few days.
The outage does, however, highlight the uncertainty of Libyan supply, which has been hovering around 1 million barrels daily for over a year, but has failed to move above this level—and not because Libyan is an OPEC member and as such is constrained by a production quota. It is because the political situation in the country is still so unstable that virtually any group with a grudge against the government—or another group—can block a pipeline or attack any piece of infrastructure and cause a production outage.
A few days ago, for example, protesters blocked the entrance to the Ragouba field, which produces around 5,000 bpd, so tanker trucks could not load crude. These particular protesters demanded social and health care benefits and lifted the blockade when the operator of the field promised to grant these.
Last month, a militant group attacked the pipeline feeding crude from the Waha oil field to the Es Sider export terminal, costing the field operators around 80,000 bpd in lost production. This was the second attack on this pipeline in five months. Waha produces 300,000 bpd, on par with Libya’s largest field, El Sharara, which has also been the target of several attacks.
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