Watching Libya September 22, 2011

Al Jurf offshore oil field (block C137) is expected to restart production tomorrow (September 23) at sunrise. Al Jurf is capable of producing 41,000 barrels daily (bpd). Exports should begin in mid-October. The development of this offshore field is ruled and governed by an amended EPSA74 agreement signed and ratified in April1996 between the National Oil Company (NOC), ELF AQUITAINE (now TOTAL) and WINTERSHALL.

The present licence is valid until April 2017 extendable by 5 years in case of production extension and participating interest is NOC 50.0 %, TOTAL 37.5 % and WINTERSHALL 12.5 %. Offshore facilities such as Al Jurf, unlike onshore ones, have not suffered any damages and are therefore able to start production as soon as a decision is taken for them to do so. Mabruk is, to the best of our knowledge, the first oil company with foreign shareholding, to resume production. the wholly state owned company Arabian Gulf Oil has already started production.

Production at Al Jurf is from a fixed drilling and production platform set at a water depth of 87 metres linked by a 10 inch sea line to a Floating, Production, Storage & Offloading unit (FPSO) about 3 km away at a depth of 83 meters. Production has reached the maximum capacity of 40,000 bpd in less than a year from production start. Before the uprising, development plans were on the agenda to hike up production to 50,000 bpd.

The earliest possible resumption of oil production and export is vitally important. Although it would not, alone, be sufficient to ensure the economic and social conditions required for a politically stable reconstruction of the country, it is necessary if these conditions are to be at all possible.

Surprise attacks on oil fields by Gheddafi diehards – such as that on Ras Lanouf on September 12 – may delay the resumption of production, hence the importance of capturing or eliminating loyalist militias at the earliest. The sooner Gheddafy and his closest associates are out of action and shown to be out of action, the sooner will remaining supporters give up.

For more on Libya's oil and the Libyan revolt against the regime, see:

Watching Libya March 4, 2011

Watching Libya March 11, 2011

Watching Libya March 16, 2011

Watching Libya March 25, 2011

Watching Libya April 2/3, 2011

Watching Libya April 5, 2011

Watching Libya April 6, 2011