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[Update] Most Libyan Oil Ports Remain Closed

Published Aug 22, 2013 1:55 PM by The Maritime Executive

Libya's largest crude oil export terminal Es Sider and the oil port of Zueitina remain closed, Deputy Oil Minister Omar Shakmak said on Thursday.

Some improvement was seen at other ports. Libya's state National Oil Corp (NOC) trimmed its force majeure by removing the Marsa al Brega port from the list, the company said on its website on Thursday.

Local sources and agents said earlier this week that Brega had reopened but no oil had yet loaded.

Force majeure is a legal term to cover the suspension of contractual obligations, and is put in place or lifted after the situation has changed.

An oil tanker was expected to arrive at Brega on Thursday, Libyan and trading sources said. The crude tanker Vallesina reversed direction towards the port the same day, Reuters AIS Live ship tracking data showed. No further details emerged.

Es Sider has been closed for nearly four weeks, and industry sources said neighbouring Ras Lanuf was also still shut.

The outages have culminated in the worst disruption to Libya's oil sector since the civil war of 2011, slashing production and exports.

Shakmak told Reuters that Libya's oil output was around 680,000 barrels per day, up from estimates last week of 600,000-630,000 bpd.

Chief policy analyst Richard Mallinson at Energy Aspects estimated production at a lower rate of around 560,000 bpd and exports lower than recent weeks at around 290,000 bpd.

The situation at Marsa al Hariga was normal again and no protesters were in the port, Shakmak said. He did not specify the status of other terminals.

"We should be able to berth tonight, though this could change. The pilot will board in an hour," the ship operator of the Hellas Warrior crude oil tanker waiting at Hariga said.

The force majeure remained in place for Es Sider, Ras Lanuf and Zueitina. Only terminals in western Libya have remained disruption-free during this period. The Zawiya terminal there was exporting crude, along with offshore platforms at the Bouri and Al Jurf fields.

NOC issued a tender to sell a Mellitah crude and condensate blend for Aug. 28-30 loading, after the field resumed around Aug. 12, one trading source active in Libya said. No tankers have yet called to load crude oil and the grade has not yet been stabilised to pre-disruption quality.

ZUEITINA CALMER

The situation at Zueitina has calmed somewhat after flaring earlier this week when gunfire was exchanged between protesters occupying the port and civilian counter-protesters.

The head of the Petroleum Facilities Guard, Edris Abokhamada, contacted the defence ministry for reinforcement but the army has not been sent, a spokesman for the PFG said.

"There is a big meeting today with Edris and all the ports. There haven't been any attacks to clear a port, no army sent," the spokesman said.

"They (the protesters) think they should take the east away."

Since the fall of Muammar Gaddafi, multiple movements in eastern Libya have voiced calls for greater autonomy, particularly over its oil. Libya's government said earlier this year it would move the headquarters of state company NOC.

But fractures within the government have slowed action.

"Local and regional activism should lead to the oil industry being restructured ... This is part of a broader debate about decentralising budgetary and decision-making authority," Control Risks consultancy said in a note on Thursday.

"However, Libya's legal and institutional vacuum, which will continue at least until a constitution has been ratified, means that decisions about restructuring may be short-lived and not enacted quickly."

By Feras Bosalum and Julia Payne; Additional reporting by Peg Mackey; Editing by William Hardy and Dale Hudson (C) Reuters 2013.