Libyan rebels want oil workers back

24 August 2011, Sweetcrude, Tripoli – Libyan rebels want oil workers to return to the war-torn country, reports said Wednesday, but questions about when new oil production could resume and the fate of security still loomed large.

Rebel spokesman Ahmed Bani told Reuters they wanted employees to come back to the Ras Lanuf and Brega oil terminals in eastern Libya after rebels regained control there earlier this week.

Damage was minimal to the facilities, Reuters reported, with the larger Ras Lanuf reporting no damage and the terminal at Brega indicating one damaged storage tank.

The new Libyan government’s “top priority” will be to ensure enough stability to allow the resumption of production “in order for Libya to start earning the oil export revenue on which it almost totally depends,” IHS Senior Middle East energy analyst Samuel Ciszuk wrote in a note, according to Bloomberg.

But a note from the AKT Ltd. consulting group suggested that conditions were more dangerous than ever for foreigners, with the on-the-run Colonel Gaddafi ordering loyalists to kidnap expats to pressure rebel forces and the international community.

Anyone on the ground should limit movements and take care in Tripoli, which the group now deems “the most hazardous city in the world.”

“There is widespread small arms fire, RPG attacks and indirect fire (rockets and mortars), whilst looting, opportunistic criminality and celebratory gunfire are also being reported,” the group said.

As pockets of fighting wore on and the search continued for the at-large dictator, oil players in Libya continued to scope out the situation for oil production when and if the conflict dies down, reports said.

Bloomberg reported that Eni, Italy’s biggest oil company, is lobbying rebel leaders to hold its position as Libya’s top energy producer after the end of Muammar Qaddafi’s 42-year regime.

Eni has been in contact with rebel groups throughout the conflict to ensure it doesn’t lose ground to French, UK and US companies trying to take advantage of their countries’ air strikes against Gaddafi’s forces, said a person with knowledge of the company’s strategy, declining to be named because the information is confidential.

Eni Chairman Giuseppe Recchi said yesterday in an interview he was confident any new government would honor pre-existing agreements. While he was unable to say when production will resume, Recchi said an end to the conflict with Gaddafi would be “very positive.”

The company has said it may take about a year to restore Libyan oil output fully and two or three months to bring back full gas flows. Eni’s oil and gas volumes in Libya have fallen to about 50,000 barrels a day of oil equivalent from 280,000 a day before the conflict.

The news wire suggested that France’s Total, which gets 2.5 percent of its global production from Libya, is seen as a particular threat due to France’s leading role in rallying the international community to the rebel cause, the person said.

France, which was the first country to recognize Libyan opposition leaders and led efforts to launch air strikes against Qaddafi, has also been lobbying rebel forces to ensure its companies are not forgotten once new contracts start getting assigned, according to a person familiar with the negotiations, who asked not to be named because the talks aren’t public.

Total, which produced 55,000 barrels a day of crude in Libya, said it is monitoring events to determine when a restart may be possible. A spokeswoman declined to comment further on its plans in Libya.

Bloomberg suggested that other players in Libya with a potential interest in further tapping the nation’s vast oil reserves could include London-based BP, Houston-based ConocoPhillips, BASF SE’s Wintershall unit, Madrid-based Repsol, and Austria’s OMV AG.

Repsol Finance Director Miguel Martinez said on a July 28 conference call that the company’s Libyan assets are intact and its staff are ready to return to the country once the conflict has ended. It will take the company up to four weeks to restart production, he added.

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