Dow Today – Libya NOC Boss Sanalla Gets New Backing from Premier
(Bloomberg) — The long-serving head of Libya’s state-run oil company will remain in his post, Prime Minister Abdul Hamid Dbeibah said in a decree, looking to end a feud between two key oil officials and bolster the stability of the OPEC nation’s financial lifeline.
Dbeibah’s Sept. 14 decree, which was seen by Bloomberg, effectively nullifies an earlier decision by the oil minister, who sought to suspend the National Oil Corp.’s, Mustafa Sanalla.
Oil Minister Mohamed Oun’s August decision had been predicated on a claim that Sanalla had traveled abroad without approval — a “violation” of ministry policy. But the move had been widely read as another example of Libya’s convoluted politics and a tussle between vying institutions that risked causing a slump in the OPEC member’s crude production.
Sanalla, who’s held his post since 2014, has sought to keep the NOC out of the political fray that emerged amid a conflict between rival governments in the east and the west. The NOC head is seen as someone who’s effectively run the oil sector for years, including signing deals with international companies and representing Libya at Organization of Petroleum Exporting Countries meetings.
Libya Oil Output at Risk Again Due to Political Power Struggle
While a U.N.-brokered deal led to the establishment of a unity government, that cohesion has yet to filter down to the various state institutions. That’s tested efforts to rebuild a nation mired in conflict since the 2011 ouster and killing of longtime leader Moammar Qaddafi.
Oun, who assumed his post in March with the re-establishment of the ministry, wants the NOC’s board to be changed and Sanalla removed — a move that Dbeibah resisted. The formation of the oil ministry created administrative overlap with the NOC, resulting in ambiguity over who’s best equipped to run the vital sector.
Relative political stability over the past few months resulted in output hovering at almost 1.2 million barrels per day.
Protesters, however, recently briefly halted oil exports from three key terminals in the east, while others have also threatened to shut down output in fields such as Sharara, the nation’s largest. That spotlights how easily the situation in Libya can change.
Ensuring a stable flow of oil is pivotal for Libya’s political reconciliation and economic rebuilding efforts. Revenue from crude sales is the country’s main source of foreign income. Interrupting that cash flow could undermine political stability, including much-anticipated December elections.
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