Libya Oil Exports Stutter, Major Eastern Ports Await Restart

Posted by Michelle Howard
Wednesday, July 16, 2014

Libya will not be able to export oil through its two largest eastern ports before August, due to safety checks after a near year-long closure, a senior oil official said on Wednesday.


The latest twist in a spiral of violence also casts a shadow over the vital deal two weeks ago to end the eastern blockade by federalist protesters of the last two facilities they held.

Until April, the rebels were holding four out of five eastern ports, cutting off over half of Libya's export capacity.

But an oil export return is proving slow and a full ramp up is already facing new obstacles with a fresh protest by oil guards at the port of Brega.

At least 15 people have been killed in the capital and the eastern city of Benghazi since Sunday. Fighting between rival militias has transformed Tripoli's airport into a battlefield, cutting the Libyan capital off from the outside world.

A senior Libyan oil official said technical teams at the two main eastern oil ports - Ras Lanuf and Es Sider - were still carrying out assessments.

"They have to check the pumps, lines, fields...carry out preventative maintenance," Ibrahim al-Awami, general manager of inspections and measurement at the Libyan oil ministry, said.

"It probably won't start until August."

The two ports together can export 500,000 barrels per day, accounting for over a third of Libya's export capacity of 1.25 million barrels per day.

With the return of some eastern output and the restart of a major western oilfield, the OPEC member's production has recovered to nearly 600,000 bpd, compared with its pre-oil crisis level of 1.4 million bpd, its acting oil minister said on Tuesday.

Wary Oil Traders
Oil traders had remained cautious about any quick return of full Libyan exports.

"There were expectations of further problems and protests emerging, but the Libyans announcing the two main eastern ports will not reopen until next month cuts the return of Libyan supplies compared to market expectations," Richard Mallinson at Energy Aspects in London said.

"The current deal may hold, at least until a new government forms and the federalist rebels see if their demands can be met, but the increased level of violence in the country is a worry."

Brent crude oil prices have fallen from more than $115 a barrel in late June to a 3-month low of $104.39 a barrel on Tuesday, partly on the expectation of more Libyan exports, but recovered to above $106 a barrel on Wednesday.

Trading and shipping sources said no tankers have yet been booked to sail to Ras Lanuf or Es Sider for loading, despite the government announcing that the force majeure on the ports had been lifted last week.

Two Aframax tankers have loaded at the small western port of Mellitah in the last two weeks, trading and shipping sources said, while a third - the Olib - has docked at the easternmost port of Hariga, according to Reuters AIS Live tanker tracking.

The eastern port of Zueitina, which along with Hariga reopened through an earlier deal with the rebels in April, is not exporting as oilfields have yet to restart and storage tanks are empty.

High official selling prices, which are set by the National Oil Corp. (NOC), have also dissuaded international buyers, trading sources said, with many saying they have been priced at least $1 a barrel above other comparable quality crudes.

"They will have to offer discounts to sell it," one trader said.

The quality of the oil is also a concern for traders, as much of the readily available crude has been sitting in storage tanks for nearly a year.

Estimates for where Libya's oil exports may be in the next two months vary wildly.

If the port deal holds, average shipments could vary between less than 500,000 barrels per day to as much as 1 million bpd depending on technical difficulties, according to industry estimates and Reuters calculations.

(By Ulf Laessing and Julia Payne, Writing by David Sheppard, editing by William Hardy)

Maritime Today


The Maritime Industry's original and most viewed E-News Service

Maritime Reporter May 2016 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Tanker Trends

A Year is a Long Time in Tankers

The latest Gibson Market Report focused on the age profile of the VLCC fleet and the prospects for trading life beyond 15 years of age.    Analysis of the Suezmax fleet shows a similar picture,

Strike In France: Implications for Tanker Demand

After the oil industry suffered from a severe drought in Venezuela, forest fires in Canada and rebel attacks on oil installations in Nigeria, it is now facing

Floating Storage Flattens Fortunes of $50 Crude

The prices of WTI and Brent crude briefly rose above $50/bbl during intraday trading on Thursday, the highest level seen since the end of July 2015, giving traders a brief moment of optimism,

Ports

Seaway Stakeholders File Suit Against US Coast Guard

Ports and vessel operators challenge what they call “flawed pilotage fees”   A coalition of U.S. Great Lakes ports, vessel operating companies and maritime trade

Damen Delivers Floating Pump Station to Hamburg

Hamburg Port Authority (HPA) has taken delivery of the Sauger III, a custom floating pump station by Damen Shipyards Group for supporting dredging operations. Situated

Mothballed Vessels SE Asia Reflect Oil Slump Pain

Around 1,300 offshore support vessels lying idle worldwide. Not everyone in shipping is bemoaning the industry's worst crisis in living memory: a cluster of

Finance

Baltic Index Up On Higher Capesize Demand

The Baltic Exchange's main sea freight index, tracking rates for ships carrying dry bulk commodities, rose on Tuesday helped by an increase in demand for capesize vessels.

Mothballed Vessels SE Asia Reflect Oil Slump Pain

Around 1,300 offshore support vessels lying idle worldwide. Not everyone in shipping is bemoaning the industry's worst crisis in living memory: a cluster of

Asian Traders Unload Floating Gasoline as Market Flips

Gasoline shifted from tankers to landed storage or sold off; forward gasoline prices to flip to backwardation from July. The number of tankers storing gasoline

Energy

Mothballed Vessels SE Asia Reflect Oil Slump Pain

Around 1,300 offshore support vessels lying idle worldwide. Not everyone in shipping is bemoaning the industry's worst crisis in living memory: a cluster of

Asian Traders Unload Floating Gasoline as Market Flips

Gasoline shifted from tankers to landed storage or sold off; forward gasoline prices to flip to backwardation from July. The number of tankers storing gasoline

Bulgaria, Greece to Consider Greek LNG terminal

Bulgarian state energy holding company BEH and Greek natural gas company Gastrade have set up a joint task force to prepare a proposal to build an off-shore liquefied

News

Kvichak Delivers for the NYPD

Kvichak Marine Industries informs it continues to expand production of its high performance vessel line with delivery of another Response Boat - Medium Commercial   Kvichak,

Seaway Stakeholders File Suit Against US Coast Guard

Ports and vessel operators challenge what they call “flawed pilotage fees”   A coalition of U.S. Great Lakes ports, vessel operating companies and maritime trade

Royal Caribbean Selects Quintiq Software

Quintiq, a Dassault Systèmes company, announced that Royal Caribbean Cruises Ltd. has selected its software solution to optimize the assignment of more than 80,

 
 
Maritime Contracts Maritime Security Navigation Pod Propulsion Port Authority Ship Electronics Ship Repair Ship Simulators Shipbuilding / Vessel Construction Winch
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1012 sec (10 req/sec)