Libya crude output falls by 120,000 b/d as Marsa el-Hariga remains shut: sources

London — Libya is in the middle of another production setback due to a halt in crude exports from the 230,000 b/d Marsa el-Hariga terminal, shipping and industry sources said Feb. 9.

State-owned National Oil Corporation's subsidiary, the Arabian Gulf Oil Company, which operates the fields that feed into export grade Sarir/Mesla, have shut in almost 120,000 b/d of production in the last week, sources added.

Shipping data showed that no Libyan crude was exported from the terminal since Jan. 21, almost three weeks ago.

This comes as a militia controlling key eastern terminals have briefly shut down shipments in a long-festering salary dispute.

The Petroleum Facilities Guard militia group began a strike at the Marsa el-Hariga in late-January, demanding the immediate disbursement of all salaries, health insurance payments, and other oilfield-related payments.

Payment disputes

"Production from the Agoco fields is going down significantly because tankers were unable to load at Marsa el-Hariga," said a source, who has operations in the country.

The source said some guards had received their salaries, but others were demanding field allowances.

"There are a number of issues. Those with military ids have received all dues but are demanding field allowances to be reinstated," he said. "While those without military ids have received some of their payments, but are demanding field allowance plus military registration."

A representative at NOC was unavailable for comment.

The Suezmax Delta Eurydice was expected to load from Marsa el-Hariga this week, but the tanker has now been diverted to the nearby 350,000 b/d Es Sider terminal, data from Platts trade flow software cFlow showed.

The last tanker to load from Marsa el-Hariga was the Delta Sky between Jan. 20 and 21, which is now en route to China.

Suezmaxes Front Cruiser and the Malibu are also near the terminal, hoping to load soon, according to cFlow data.

Libya produced 1.14 million b/d in January, according to the Platts OPEC survey, a fall of 40,000 b/d, marking its first month-on-month production fall since May.

The decline was due to pipeline maintenance that affected the Waha oil fields, and some exports were also disrupted briefly by strikes at some of Libya's key eastern terminals.

The North African producer has managed to add more than 1 million b/d in the last three months after its two warring factions -- the UN-backed Government of National Accord and the self-styled Libyan National Army -- agreed to a peace deal.

Libya holds Africa's largest proven reserves of oil and its main light sweet Es Sider and Sharara export crudes yield a large proportion of gasoline and middle distillates, making them popular with refineries in Europe and China.