Libya: The Re-Emergence of a Hydrocarbon Giant
The Libya Energy & Economic Summit 2021 unites regional and international stakeholders in Tripoli for two days of networking and dialogue. Through a series of insightful panel discussions and presentations from industry professionals, the Summit aims to provide a consolidated understanding of the conditions for oil and gas investment and financing, power provision, new projects, Libya’s role as an Africa/Europe energy nexus, and the country’s position in the energy transition narrative.
During the first day of the conference, a flagship panel discussion on the state of the oil and gas industry in Libya provided insight into the future of Libya’s upstream oil and gas production, where the industry is now, successes and challenges, and an outlook on new projects. Moderated by Haythem Rached, Co-founder, Cacti Energy Consulting, panel participants included Roberto Bertocco, Chief Technical and Commerical Officer, Petrofac; Simone Sciamanna, Libya General Manager, Repsol; Paul McCafferty, Senior VP – Africa, Equinor; Dag Sanner, President Libya, ConocoPhillips; Wale Ajibade, Executive Director, Sahara Group; Wanis Elruemi, Deputy GM, Eni; and Laurent Vivier, Senior VP Middle East and North Africa, TotalEnergies.
Libya holds the largest oil and gas reserves in Africa, with recoverable reserves pegged at 43 billion barrels of oil and 1 trillion cubic feet of natural gas. The country is focused on revamping exploration and resuming drilling campaigns in key basins, while enhancing investment in existing infrastructure.
“We have been a long-standing investor in Libya and have seen many ups and downs. To sustain production and growth production, investment is needed,” stated Sanner.
The Libyan government has set an ambitious target of increasing production to 2.1 million barrels per day (bpd) by 2025. Already, in just one year, the country has accelerated production from just 390,000 bpd to 1.24 million bpd. This target opens up lucrative investment opportunities within the mid- and downstream in Libya.
“The production resumption is not a surprise, and it has been so quick for several reasons. The operator has been doing its job, despite the difficult situation, to prepare for the resumption of production. The good relationship between NOCs and operators and the work we have been able to do has led to the quick resumption. Ramping up production can be done with what we have today. We need to resume key activities in the field,” stated Sciamanna.
“Production can be increased with some investment in the facilities. Oil producing countries should have a different point of view on renewables. Libya lags behind in production. There was no systematic exploration and production. There is lots of oil to be produced, already found, and to be found. The Libyan oil industry has to speed up and take a look back at the agreements and encourage investment in order to unlock all of this oil and gas. Renewables are advancing so fast; in 20 or 30 years we will have nothing to do with oil anymore. Libya needs to focus on hydrocarbons, and in parallel, build some renewable projects,” stated Elruemi.
Additionally, the panel provided insight into how Libya can remain competitive for international investment in the face of declining capital expenditure in global markets.
“For us to make significant investment we need stability. The pot of capital is smaller, and I don’t think it will ever recover to levels we have seen before. This is competition for Libya, and we need to live up to that by providing a secure environment that will attract investment,” stated McCafferty.
“Libya needs a reliable partner that will stay here for a while. We have seen this with TotalEnergies, Equinor, Repsol, and ConocoPhillips. It makes a lot of sense to play with a global company, but locally. Locally you need to evolve and keep on putting pressure to increase your in-country value. This can be increased only if you have a long term and sustainable plan for the future,” stated Bertocco.
Meanwhile, the panel provided insight into the energy transition, promoting opportunities and challenges in the country while emphasizing how countries active in Libya are moving ahead with the transition.
“When we start talking about energy transition, yes, it is well appreciated and accepted, but without the right investments and enabling environment, it will be difficult for us to transition to renewable energies. When we talk about green energy and renewable energy, there is a cost. How are we going to achieve the energy transition if the economies of our countries are not better?” stated Ajibade.
“We made it clear today that we are ready to bet on renewable energies in Libya and the reason is simple. The potential is here, you have high levels of exposure to solar and energy on the Libyan floor. The resource is available, and the grid needs more power and very quickly. There has been a greater consumption of electricity and the production from hydrocarbon resources hasn’t been matching with this increase. The beauty of solar is that it can be developed relatively quickly,” stated Vivier.
Distributed by APO Group on behalf of Energy Capital & Power.