Libya's Hariga Port to Resume Oil Exports Within Days

Libya's eastern Hariga port will resume oil exports within days after protesters agreed to end a four month blockage, an oil official said on Friday.

A reopening would be a victory for Prime Minister Ali Zeidan who has been trying to end such blockades, which have reduced Libya's oil output to 250,000 bpd from 1.4 million bpd in July, cutting much needed revenue for rebuilding the state.

The protesters in the east, which was the cradle of the revolt that ousted veteran leader Muammar Gaddafi, also have their own victory, of sorts, as Libyan authorities are building a new oil headquarters there, moving it from the capital Tripoli in the west, to appease their calls for greater autonomy.

Tribesmen and other protesters have occupied Hariga, located in Tobruk in the far east of Libya, since August to press their financial and autonomy demands despite several government attempts to reopen the terminal.

It has an export capacity of 110,000 barrels per day and also serves the Tobruk oil refinery.

There was no immediate confirmation from the government which has repeatedly announced Hariga would reopen. But in a sign of progress, state National Oil Corp (NOC) said last week the 20,000 barrels a day-Tobruk refinery had resumed work.

Mohamed Ben Shatwan, head of Arabian Gulf Oil Co (AGOCO) operating Hariga port, told Reuters an agreement had been reached with local people to secure the port and restart the export terminal.

"A ship is docked at the port, and exports will resume within days," Shatwan said in the eastern city of Benghazi, adding that oil from the Sarir field had already been pumped to the port.

He spoke on the sidelines of ceremony attended by senior officials to lay the foundation stone for the new NOC headquarters in Benghazi, which will move from Tripoli.

Another oil official, asking not to be named, said it was not yet clear whether the protesters would allow the loading of tankers but a group of activists planned to travel by boat to the port to convince them to end the blockage.

The protesters, which have been divided over what to demand, have several times prevented tankers from docking at the port.

Pressure has been building on militias and tribesmen seizing ports and fields to allow the resumption of oil exports, the main source for the national budget and to fund food imports.

Zeidan has warned the government might not be able to pay public salaries if strikes continue.

FOUNDATION

Many in the east, home to much of the country's oil wealth, sympathise with port and oil strikers campaigning for a greater share of oil sales and power in the turmoil that has bedevilled Libya 2-1/2 years after Gaddafi was ousted then killed.

"We meet today to lay the foundation stone ... for the National Oil Corp and other government institutions to achieve economic and social development," Deputy Oil Minister Omar Shakmak told the audience.

State-owned Libyan Airlines, the Libyan Insurance Company and the National Investment Company are also set to move to the eastern port city, which was starved of cash under Gaddafi.

Last week, the Tripoli government had expected a heavily armed autonomy group in eastern Libya to lift the blockage of the Ras Lanuf, Es-Sider and Zueitina ports previously accounting for 600,000 bpd after tribal elders pressured it.

But autonomy leader Ibrahim Jathran declared at the last minute that talks with Tripoli to get a greater share of oil revenues for the east had failed.

Jathran's and other militias involved in oil strikes in the east and other parts of the country helped topple Gaddafi in 2011 but have kept their weapons, fuelling concerns about instability in the North African country.

The NOC ceremony came as gunmen assassinated one air force officer in another part of Benghazi while he was leaving a mosque after Friday prayers, a security source said.

The security situation has sharply deteriorated in Benghazi, Libya's second-largest city, in the past few months.

Most countries closed their consulates in the city after a series of attacks and some foreign airlines have stopped flying there. The U.S. ambassador and three other Americans were killed in September 2012 during an Islamist assault on the consulate.

Western diplomats worry the violence in Benghazi will spill over to the capital which has also seen some clashes between militias in recent months.