Libyan PM forms committee to negotiate with NOC’s foreign partners terms of profit

General view of the industrial zone at the oil port of Ras Lanuf March 11, 2014. REUTERS/Esam Omran Al-Fetori (LIBYA - Tags: BUSINESS ENERGY) - RTR3GTF3

The Libyan Prime Minister, Abdul Hamid Dbeibah, formed a committee to negotiate with the two foreign partners – Total and ConocoPhillips – to amend the concession agreement and participation in the fields of Al-Waha Oil Company, in a step contrary to objections by the Attorney General, the Audit Bureau, members of the House of Representatives (HoR) and several field specialists.

The committee is headed by Khalifa Abdelsidiq: the Undersecretary of the Ministry of Oil and Gas, who has been assigned the duties of Minister of Oil – after the suspension of Minister Mohammed Oun.

The decision also said that the committee would negotiate with the two foreign partners to develop oil discoveries in the fields managed by Al-Waha Oil Company in the three concession contracts in northern Jalu region to improve the conditions set by the partners for participation, agree on a timetable to begin development, and present the results of the negotiation to the Supreme Council for Energy and Water Affairs.

The reserves available for production from Al-Waha Oil Company fields are estimated at about 6 billion barrels, and within the limits of current production levels (350.000 barrels per day), they could provide continued production for 60 years.

The Chairman of the National Oil Corporation (NOC) Farhat Bengdara, sent a letter to Dbeibah, in which he called for the provision of investments ranging from 15 to 20 billion dollars to implement the NOC’s plan to increase the production of Al-Waha Oil Company fields to 850.000 barrels per day, telling Debeibah that he “prefers the offer of Total and ConocoPhillips in this regard.”

Dbeibah’s decision comes two weeks after the resignation of Oil Minister Mohamed Oun, and a quick response to the letter from Bengdara, in which he has proposed negotiations with Total Energy and ConocoPhillips, as one of two options after they have demanded an increase in their profit margin from 6.5% to 13% of the production share, which is equivalent to 40.83%, with extension of their contracts with the Libyan NOC to 2046.


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