Abdalla Salem el-Badri, secretary general of the Organization of the Petroleum Exporting Countries, said Libya could reach prewar levels by the end of next year. But Shokri Ghanem, the former chairman of Libya’s state-run oil company, said a return to full production could take until the end of 2013.
“The question is whether the war is ended or not,” Mr. Ghanem said, underlining the risks to oil supplies in the aftermath of revolutions that have swept North Africa and the Middle East. “The picture is still unclear,” he said, referring to the situation in Libya since the ousting from power of Col. Muammar el-Qaddafi.
The two representatives made their remarks at the Oil Money conference, which is jointly organized by The International Herald Tribune and Energy Intelligence, in London.
Mr. Ghanem, who was the top oil official in Libya until earlier this year, said the country could produce 550,000 barrels of oil a day by the end of this year and a million barrels a day by next June. But he said Libya still could require up to two years to reach prewar production levels of 1.6 million barrels a day — and only on the condition that oil fields were adequately secured.
Libya is a relatively small producer compared with other OPEC countries, but it is an important supplier of the light sweet crude that many refineries around the world depend on.
Total of France, Eni of Italy and Repsol of Spain are among the companies with significant stakes in Libya.
Mr. Ghanem said it would be difficult for the new authorities to offer more generous terms to foreign investors than the previous government, but he said renegotiations “could happen.”
He said Brega and Ras Lanouf were among the sites that had been badly damaged, partly because of widespread looting. He said that contractors’ quarters and metering instruments had been damaged, and that spare parts and fleets of four-wheel-drive vehicles were stolen.
He estimated that it would cost “a few” billion dollars to repair damaged sites and replace equipment.
Underlining the caution among executives about Libya, Andrew Gould, the chief executive of Schlumberger, a major oil services company, said he would need to deploy about 100 security personnel in Libya to resume activities there this year.
Mr. Gould said Schlumberger still employed a far larger number of security personnel — more than 400 — in Iraq.
Mr. Ghanem said, “Now we are in the same boat” as Iraq, adding that the security situation was being further complicated by upheavals in neighboring countries, including Algeria, Chad and Niger.
Mr. Badri, who was chairman of the Libyan National Oil Corporation from 2004 to 2006, appeared to take a more upbeat view of the situation there. He insisted that production facilities were not seriously damaged and that the country had technicians to revive the industry.
Mr. Badri also said he was optimistic about avoiding a rerun of a rare public split within OPEC in June, when Iran and five other countries rejected a proposal to raise output by 1.5 million barrels a day after turmoil in Libya shut down production.
“In December, we’ll come up with a positive ending,” said Mr. Badri, referring to the next meeting of OPEC oil ministers in Vienna.
Mr. Badri said members were making sufficient investments to replace wells that were becoming depleted and to keep up with demand in countries with fast-growing economies, like China.
He said OPEC member countries had plans to undertake 132 projects worth $300 billion to increase gross production capacity by 21 million barrels a day by 2015 or 2016.
Article source: http://www.nytimes.com/2011/10/12/business/global/security-issues-weigh-in-libyas-oil-production.html?partner=rss&emc=rss