Chevron considering Libya return as security improves: NOC

Chevron is showing "serious interest" in returning to Libya after a 15-year hiatus, the country's National Oil Corp. said Aug. 26, following a meeting between the US oil group and Libya's oil minister and NOC officials in London.

In a statement posted on social media, NOC said it was "exploring cooperation opportunities" with Chevron in oil exploration and production. Photographs of the meeting show Chevron officials and oil minister Khalifa Abdulsadek.

The discussions in London focused on "opportunities for developing untapped reservoirs, leveraging unconventional hydrocarbon resources, and discoveries," it said.

Libyan officials claim the country holds 4 billion barrels of undeveloped oil reserves, in addition to unconventional resources of 18 billion barrels of oil and 123 Tcf of natural gas, making it Africa's biggest oil province.

However, the country's oil sector has long been blighted by political instability, with knock-on effects on oil production.

"For his part, the head of Chevron's team confirmed that the company is showing serious interest in returning to the Libyan market after an absence since the last oil tender in the past decade, and resuming its activities in the field of exploration and production," NOC said, noting its recent efforts to boost investments and ties with international firms.

A spokesperson for Chevron declined to comment directly on a potential return to Libya.

"Chevron is constantly reviewing new exploration opportunities to support our upstream business," the spokesperson told Platts, part of S&P Global Energy, in a statement. "Chevron does not comment on commercial matters."

However, the meeting comes just a month after NOC said Chevron had been among the bidders in its first oil bid round since the fall of Moammar Qadhafi in 2011, which plunged the country into chaos.

Chevron -- which has projects across Africa -- entered Libya in 2004 after sanctions were lifted, but ultimately relinquished its licenses in 2010 after unsuccessful exploration efforts.

Production spike

A number of the company's peers have taken steps to return to Libya or pick up activities in the North African country in recent months, amid an improvement in the security situation and soaring oil output.

ExxonMobil signed a deal with NOC to end its 12-year hiatus in July, following similar agreements by British oil groups BP and Shell.

Libya is still administered by rival governments in the east and west, and the pivotal oil sector -- which accounts for some 93% of government revenues -- remains a target for political actors, protestors and militia groups.

However, production rose to hit a 12-year high of 1.25 million b/d in July, thanks to increased exploration activity, the return of IOCs, new discoveries, relative political stability and the reactivation of shut-in wells.