Libya could see an increase in production in the coming days after the reopening of a key crude oil export pipeline from the Sharara field, the country's largest oil field, after it was closed Sunday, sources said.
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The 340,000 b/d Sharara field and nearby 12,500 b/d Hamada field in the southern Murzuq basin, were closed Sunday, following the closure of the Sharara pipeline valve.
A spokesman for state-owned National Oil Corp., told S&P Global Platts that the Sharara pipeline valve had now been reopened, but would not comment on the status of the fields.
Sources in Libya said the valve was closed by a contractor at the field who complained of not being paid by the operator, as well as local landowners who were protesting against pollution in the area.
Libyan oil production has plummeted as the country's largest oil field Sharara and the nearby Hamada field both shut down Sunday.
It meant Libyan oil production has plunged by almost 40% from mid-February levels, as just over a week ago, the 90,000 b/d Elephant or El Feel field also shut due to protests by local tribes and guards.
These recent events show how fragile Libya's oil sector still is to supply disruptions, and unless there are marked improvements in security and access to finance, the country's output outlook situation is not expected to change.
Libyan production was averaging just over a 1 million b/d until late February but it has fallen by almost 380,000 b/d in the past week, sources added.
Sharara and Hamada were both operating close to 300,000 b/d and 10,000 b/d last week, sources added.
Crude from Sharara, El-Feel and Hamada is pumped through the same pipeline into the 120,000 b/d Zawiya refinery and the Zawiya export terminal.
All these three fields have been subject to repeated closures over the last few years due to protests and attacks on export pipelines.
Sharara is operated by a joint venture of Spain's Repsol and NOC while Hamada is operated by NOC subsidiary, Agoco.
Libya produced some 980,000 b/d in both December and January, recovering to average 810,000 b/d over the whole of 2017, after much lower numbers a year earlier, according to the latest S&P Global Platts survey of OPEC producers.