Tuesday, September 27, 2011

Eni, Total resume oil production in Libya

(AP) ? Italian energy giant Eni said Monday it has resumed oil production in Libya after months of interruption for the civil war, tapping 15 wells and producing some 31,900 barrels of oil per day. French energy company Total said it restarted some production last week.

Libya's economic future could hinge on the performance of its lucrative oil and gas sectors, whose production ground to a halt during this year's insurgency against Libyan strongman Moammar Gadhafi.

Libya sits atop Africa's largest proven reserves of conventional crude, and with a population of only 6 million, raked in $40 billion last year from oil and gas exports. Still, experts say it could take about a year or more to get Libya back to its pre-war production of 1.6 million barrels a day.

Eni's revived production operations have focused on 15 wells at the Abu-Attifel field some 185 miles (300 kilometers) south of the eastern city of Benghazi, and are being conducted by Mellitah Oil & Gas, a partnership between Eni and Libya's state-run National Oil Corp.

Eni said in a statement that other wells will be reactivated "in the coming days" to reach the "required volumes to fill the pipeline" between the Abu-Attifel field and the Zuetina port on the Mediterranean.

French company Total said Monday that it resumed production on Sept. 23 in partnership with Libya's state-run oil company and a German company at an offshore well called Al Jurs. Production is slowly ramping up but will eventually be 40,000 barrels a day, according to Florent Segura, a Total spokesman.

Eni's statement was the first from an oil company saying production had resumed since the civil war. Mahmoud Jibril, the Libyan acting prime minister, had said Sept. 11 that oil production had resumed at one unspecified oil field in Libya's east, but he gave no details.

The Abu-Attifel field was the first "giant" oil field discovered by Eni in the 1960s.

Before Libya's social uprising in mid-February morphed into a full-scale civil war, Eni was producing 273,000 barrels of oil equivalent per day in Libya. It was the largest foreign producer in Libya before the civil war broke out, and its operations, mirroring Libya's oil sector in general, ground to a halt because of the fighting.

Eni CEO Paolo Scaroni visited Tripoli earlier this month to lay the groundwork for relaunching gas exports to Italy via the Greenstream pipeline, which can carry roughly 10 billion cubic meters of natural gas per year. It hasn't been operational since late February.

Scaroni has set Oct. 15 as an admittedly optimistic deadline to restart the gas flow.

Officials from the Libyan transitional government have said the new government would respect past contracts and not rush into any new deals.

Spain's Repsol YPF said Monday it hasn't restarted production yet at the fields it operated in Libya and doesn't have guidance on when it could resume. No Repsol employees have been sent yet to the firm's facilities in Libya, but the company is using Libyans and contractors to assess its infrastructure there.

"Repsol continues to closely monitor events in Libya," said company spokesman Kristian Rix.

Eni has been active in Libya, Italy's former colonial ruler, since 1959 and is the largest foreign player there in terms of hydrocarbon production.

Scaroni was the first foreign CEO to sign an agreement with the then-rebels to restart the Greenstream pipeline and asses the oil infrastructure in Libya, and his visit to Tripoli marked the first by a foreign company chief.

____

Sarah Di Lorenzo contributed from Paris.

Associated Press

Source: http://hosted2.ap.org/APDEFAULT/3d281c11a96b4ad082fe88aa0db04305/Article_2011-09-26-EU-Italy-Libya-Oil/id-239c337a0ea94ee19600256a71410464

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