Libya’s oil and gas supplies are emerging as a major resource that Europe can rely on as it relentlessly seeks alternatives to Russian energy, especially since the infrastructure is in place.
Since the escalation of the Russian invasion of Ukraine, Europe has begun to turn to other suppliers to reduce dependence on Russian gas, and Algeria, Egypt and Libya have emerged among the most prominent countries in the Middle East, capable of enhancing supplies to the old continent.
And earlier this May, the head of the Libyan Oil Corporation, Mustafa Sanalla, explained – during a press conference held in Italy – that Libya’s oil and gas resources are able to provide a safe source of supply to Europe via the sea or through existing pipelines.
Libya has large resources of fossil fuels, but the question arises, can the country provide safe supplies to Europe in light of the political turmoil that the country is witnessing at the present time?
Oil and gas resources in Libya
Libya has the largest proven reserves of crude oil in Africa, but it occupies the ninth place in terms of reserves in the world with a share of 3%.
Libya’s proven oil reserves recorded 48.4 billion barrels in 2020, unchanged from the previous year, but rather a decade ago, with the repercussions of the ongoing political conflict in the country since 2011, according to data from the British company BP.
According to preliminary estimates by Oil and Gas magazine, oil reserves amounted to 48.36 billion barrels, last year.
In 2020, Libyan oil production declined to 390,000 barrels per day, amid the repercussions of the Corona epidemic, compared to 1.30 million barrels per day in 2019, before the outbreak of the pandemic, according to OPEC estimates.
Libya’s oil production recovered over the past year to 1.143 million barrels per day, but the current political turmoil is expected to affect this year’s supply.
Libya plunged into another political crisis with the renewed struggle for power, reducing Libyan oil production to less than one million barrels per day, with the closure of major oil fields and ports.
As for natural gas, Libya is the fifth largest country in Africa with reserves, at 53.14 billion cubic feet at the end of last year, unchanged from the previous year, according to preliminary estimates by Oil & Gas magazine.
Estimates of the British oil company BP indicate that Libyan gas reserves amounted to 50.5 trillion cubic feet in 2020, unchanged from the previous year.
Plans to increase production
Libya’s National Oil Corporation plans to increase natural gas production by reducing its flaring, and developing new fields to help meet the growing demand for it in Europe.
However, the current political deadlock poses significant downside risks to achieving these goals, as the US Energy Information Administration sees it.
Oil and gas projects in Libya are usually delayed for several years; Because of security, regulatory and financial challenges.
According to British BP data, natural gas production in Libya fell during 2020, the latest available data, to 1.28 billion cubic feet per day, compared to 1.40 billion cubic feet per day in 2019.
In his statements this month, the head of the Libyan National Oil Corporation, Mustafa Sanalla, stressed that Libya is the right place to invest in natural gas; Because of the current crisis in Europe, noting that it is not a very dangerous region for oil and gas companies.
Sanalla stressed that over the past two years, international oil companies have invested more than $1 billion annually to exploit Libya’s resources.
Oil and gas exports in Libya
Libya exported 347,2 thousand barrels per day of crude oil in 2020, compared to 1.03 million barrels per day in 2019, according to an OPEC report.
Europe in the Organization for Economic Co-operation and Development accounted for almost 70% of the total in 2020, while the share of the rest of Europe was 1.5%.
Libyan gas exports fell to 39.6 billion cubic feet in 2020, compared to 201.2 billion cubic feet the previous year.
The US Energy Information Administration estimates that Libya’s gas exports rose to 114 billion cubic feet last year.
All Libyan gas exports to Italy go through the Green Stream pipeline, which became the only outlet for gas exports after the country’s only liquefaction plant was destroyed by the civil war in 2011.
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