Libyan oil operations;|
Oil exports, reserves, geology, pipelines, refining... etc.
The following is a very brief summary of Libyan oil operations; Oil exports, reserves, geology , pipelines, refining, marketing, possible future projects,and some history. In case you wanted to know. (you can search the net for this or more information.)
Oil export revenues
Libya’s oil export revenues , $28.3 billion in 2005. The rebound in oil prices since 1999, along with the lifting of U.S. and U.N. sanctions, has resulted in an improvement in Libya's foreign reserves ($31 billion as of June 2005), trade balance (a $17 billion surplus in 2005) and overall economic strong growth. On the other hand, higher oil earnings may also be removing incentives for Libya to restrain spending and to implement needed economic reforms.
In part due to higher oil export revenues, Libya experienced strong economic growth during 2004 and 2005, with real gross domestic product (GDP) estimated to have grown by about 6.7 percent and 6.5%, respectively. For 2006, real GDP is expected to grow 6.7%, with consumer price inflation of 3.1%.
According to the Oil and Gas Journal, Libya had total proven oil reserves of 39 billion barrels at the end of 2005. About 80% of Libya’s proven oil reserves are located in the Sirte basin, which is responsible for 90 % of the country’s oil output. However, Libya remains "highly unexplored" according to Wood Mackenzie Consultants, and has "excellent" potential for more oil discoveries. In addition, despite years of oil production, only around 25% of Libya's area is covered by agreements with oil companies. The under-exploration of Libya is due largely to sanctions, to the lack of modern technology, and also to stringent fiscal terms imposed by Libya on foreign oil companies. Libya's oil remains highly desired for its low sulphur content , low recovery cost and closeness to the European lucrative market.
Oil exploration in Libya began in 1955. Libya's first oil fields were discovered in 1959 (at Amal and Zelten -- now known as Nasser), and oil exports began in 1961. During 2004, Libyan oil production was estimated at nearly 1.6 million barrels per day (bbl/d), with consumption of 237,000 bbl/d and exports of about 1.34 million bbl/d. The vast majority (more than 90 percent) of Libya's exports are sold to European countries like Italy (562,000 bbl/d ), Germany (285,000 bbl/d), France (101,000 bbl/d), Spain and Greece. In addition, Libyan oil exports to the United States averaged 56,000 bbl/d during the first 10 months of 2005, after resuming in June 2004 for the first time in two decades.
Libya's revolutionary government imposed tough terms on producing companies, leading to a slide in oilfield investments and oil production declined from 3.3 million bbl/d in 1970 to 1.5 million bbl/d in 1975, before rising again to 2.1 million bbl/d in 1979. During the 1980s, Libyan oil production averaged around 1.2 million bbl/d, rising to around 1.4 million bbl/d in the 1990s.
The el-Bouri oilfield off Libya's western coast is the largest producing oilfield, with output estimated around 60,000 bbl/d discovered in 1976 and estimated to contain 2 billion barrels .Origanlly el-Bouri was estimated producing about 150,000 bbl/d in 1995, followed by a sharp decline thereafter. This decline was due largely to an inability to import EOR equipment under UN sanctions, and possibly could be reversed with an infusion of investment. Besides oil, el-Bouri also contains large volumes of associated natural gas.
Also there have been a series of oil finds at various Libyan blocks. Generally speaking, the most significant of these discoveries have been in the Murzuq basin, in the Sahara south of Tripoli. The El Sharara field, Original expectations had been that El Sharara's output of light crude production would reach 200,000 bbl/d by the end of 1998, but various problems, including difficulties with the pipeline to the port of Az Zawiya, delayed achievement of this target. Currently, oil from El Sharara is being processed by the Az Zawiya refinery.
In October 1997 discovery of recoverable crude reserves (around 700 million barrels) at the NC-174 Block, 465 miles south of Tripoli, also in Murzuq. Estimated production from the field, called Elephant, would cost around $1 per barrel . Elephant originally was due to begin production late in 2000 at around 50,000 bbl/d, and to utilize an existing 30-inch pipeline located 42 miles to the north. Production was delayed due to bureaucratic obstacles, with the field finally starting up in February 2004 at around 10,000 bbl/d. Elephant is expected to reach full capacity of 150,000 bbl/d by the end of 2006.
In August 2003, production at another oil field (the Al Jurf offshore oilfield in Block 137) has started. Estimated output at Al Jurf is around 40,000 bbl/d.
Libya has five domestic refineries, with a combined capacity of approximately 380,000 bbl/d, which is higher than the domestic oil consumption (258,000 bbl/d in 2005).
1- Ras Lanuf export refinery, completed in 1984 and located on the Gulf of Sirte, capacity of 220,000 bbl/d.
2- Az Zawiya refinery, completed in 1974 and located in northwestern Libya, capacity of 120,000 bbl/d; 3).
3- Tobruk refinery, capacity of 20,000 bbl/d.
4- Brega, the oldest refinery in Libya, located near Tobruk, capacity of 10,000 bbl/d.
5- Sarir, a topping facility with 10,000 bbl/d of capacity.
In May 2002, Libya signed a $280 million contract with South Korea's LG Petrochemicals to upgrade Az Zawiya. In addition, Ras Lanuf also was slated for upgrading, although that project appears to have been delayed.
Libya's refining sector reportedly was hard hit by UN sanctions, specifically UN Resolution 883 of November 11, 1993, which banned Libya from importing refinery equipment. Libya is seeking a comprehensive upgrade to its entire refining system, with a particular aim of increasing output of gasoline and other light products (i.e. jet fuel).
Possible future projects include
1- A 20,000-bbl/d hydro skimming refinery in Sebha, which would process crude from the nearby Murzuq field and meet local demand in remote, southwestern Libya.
2- A 200,000-bbl/d export refinery in Misurata.
Libya also has operations in Europe. Through Tamoil, Libya is a direct producer and distributor of refined products in Italy, Germany, Switzerland, and (since early 1998) Egypt. Tamoil Italia, based in Milan, controls about 7.5 percent of Italy's retail market for oil products and lubricants, which are distributed through around over 2,000 Tamoil service stations. Libya's ability to increase the supply of oil products to European markets has been somewhat constrained by the fact that Libya's refineries are badly in need of upgrading, specifically in order to meet stricter EU environmental standards in place since 1996. During 2005, there were reports that Libya was considering the sale of 50-60 percent of Tamoil’s assets in order to raise cash, and that companies like Repsol and Total were interested.
In Egypt, Libya is planning to build gasoline stations on the coastal road linking the two countries as well as in other areas of Egypt. The stations are to be run by Libya's foreign oil investment arm Oilinvest, which maintains 300,000 bbl/d of refining capacity in Europe. Also in Egypt, Libya purchased a 39 percent stake in the MIDOR refinery for $430 million in July 2003. Originally, the stake had been held by Israel's Merhav Group, which pulled out of the project after the Palestinian uprising began in late 2000.
Libya's oilfields are connected to Mediterranean terminals by an extensive network of pipelines. Libya's main crude oil pipelines, all owned by NOC.
Sarir-Marsa el Hariga (Tobruk)
Hammada El Hamra-Az Zawiya
Nasser (Zelten)-Marsa El Brega.
NOC also has six oil terminals and storage facilities (Marsa El Hariga, Zueitina, Marsa el-Brega, Ras Lanuf, Es Sider, Az Zawiya), and is considering expansion of the oil terminal and refinery facility at Az Zawiya.
NOC: The National Oil Corporation of Libya , a state-owned company that controls Libya's oil and gas production. The company is the biggest oil producer in Africa.
Tamoil: A major operator in the European oil and energy industry. Tamoil is based in the Netherlands.
Oilinvest: Trades under Tamoil brand in several European and African countries.
Midor : A 100,000 b/d refinery, located outside Alexandria with joint Israeli-Egyptian capital. Ownership of this refinery is not clear at this time, but it was a joint Israeli-Egyptian venture.
Total: France’s largest corporation and the world's fourth largest publicly-traded integrated oil and gas company.
Repsol: Spain's largest oil company. A fully integrated oil and gas company.
GDP: the gross domestic product of a country.
EOR: Enhanced oil recovery, techniques used to mature oil fields to recover additional reserves or prolong production after primary recovery methods have run their course. By increasing production efficiency, EOR methods can prolong the economic life of older fields by as much as 30 years.
This was collected and refined by Naser Masoud (not a writer) .