A Review of the Nigerian Energy Industry

Eni says largest Libyan oilfield ‘in ruins’

5 October 2011, Sweetcrude, Tripoli – Italian oil major Eni fears its largest oilfield in Libya, known as Elephant, may be in ruins. This could dash hopes of a speedy return of Libyan supplies to global markets after months of war, a report Wednesday said.

“One volunteer went with a squad of 10 rebel fighters, who escorted him on a two-to-three-hour survey in which he took pictures of the mess,” Eni’s Libyan operations manager, Mustafa Abougfeefa, said in an interview according to Reuters.

The field, which pumped 130,000 barrels of oil per day before the war, saw its airport completely destroyed along with crucial monitors and key electronic structures, he told the news wire.

“We cannot promise the field will start producing before the end of the year. Gaddafi’s militia destroyed everything,” Abougfeefa said.

The process could take even longer because the area remains a hotbed of violence where clashes between rebel fighters and troops of former leader Muammar Gaddafi continue.

The scale of damage discovered at El Feel, known as the Elephant field for its size, was a stark contrast to the conditions of Eni’s smaller Abu Attifel and Wafa fields, which have already started production at a combined rate of 76,000 bpd, around 30% below their pre-war output levels.

Gas production at those fields is also ramping up, with flows from Abu Atiffel near full at 180 million standard cubic feet per day and flows from Wafa at 315 Mmcfd, around 60% of pre-war output, according to a document emailed to Reuters.

The Bouri field is due to restart production of both oil and gas by the end of the month, the operations manager said.

Attacks by Gaddafi loyalists, food shortages and accidents were a few of the risks braved by a team of locals at the Abu Attifel field, where a minimal amount of oil was pumped throughout most of the war in an effort to preserve the facilities.

“We gave them all the support that was possible at the time, but there was no communication between the east and western parts of the country,” said Abougfeefa.

Eni’s managers now must deal with reviving contracts, a new visa system and confusion over trade sanctions.

Eni is side-stepping immigration issues by making provisions for foreign workers to operate out of Malta, but shipping continues to be a problem as waters used for commercial purposes are still classified as a war zone, keeping insurance rates high.

Two executives are already based in Tripoli to help deal with the task of reviving the business over the next few weeks.

“The administrative issues should have settled down by the end of the year,” said Abougfeefa, adding that key foreign workers had already returned and that a schedule for bringing the others back into the country was in place.

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