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Libya's NOC says improved security leads to resumption of Tatneft's exploration drilling

Highlights

Russia's Tatneft had suspended work several times

Sanalla calls on other IOCs to boost activities in Libya

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Russia's Tatneft has resumed upstream activities in Libya, state-owned National Oil Corp. said Oct. 15, as the two companies' start-stop relationship appears to have improved.

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Tatneft's operations in Libya have been suspended multiple times over the last decade due to security concerns, including a five-year stoppage from 2014-2019. But the company, which signed four production service agreements with NOC in the Ghadames and Sirte basins, has recently restarted seismic exploration in Block 4/82 in the Al-Hamada area.

"What Tatneft is doing today by resuming its exploration programs is a clear indication of the improvement in security conditions and that Libya has once again returned to the ranks of targeted countries for investment in the oil and gas sector," NOC Chairman Mustafa Sanalla said in a statement.

Libya has been wracked by political instability, with the UN-backed Government of National Unity and the self-styled Libyan National Army vying for control of the country and its lifeblood oil industry. Key oil ports and production fields have seen their operations intermittently disrupted by civil unrest.

NOC is also still awaiting its share of the federal budget, which has yet to be passed by parliament, affecting its ability to pay worker salaries and maintain its infrastructure.

The North African country produced 1.13 million b/d of crude in September, according to the most recent S&P Global Platts survey of OPEC output. It achieved peak production of about 1.75 million b/d in 2008.

In his statement, Sanalla called on other international oil companies to boost their activities in the country. Besides Tatneft, other foreign companies operating in Libya include Eni, TotalEnergies, OMV, ConocoPhillips, Wintershall and Repsol.

"NOC and all its staff are ready to provide full support to the exploration companies operating in Libya, and we call on them to follow the example of Tatneft and start resuming their exploration activities to implement the remaining work program," the statement said.

Libyan crude, which is typically light, low in sulfur and yields a good amount of middle distillates and gasoline, is extremely popular among refineries in the Mediterranean and Northwest Europe. Libya's main crude grades include Sharara, Es Sider, Sarir/Mesla and Amna.