Libyan PM threatens action to halt oil sector crisis within 10 days

London (Platts)--11Nov2013/952 am EST/1452 GMT


A resolution to the crisis that has crippled Libya's oil sector, pushing its production down to just 250,000 b/d, could be close after prime minister Ali Zeidan at the weekend threatened unspecified action within 10 days against protesters that have blockaded key oil infrastructure across the country since the summer.

Zeidan, at a briefing in Tripoli, also said that the protesters should act now to end the standoff or face the possibility of foreign powers intervening.

His comments come as factions in eastern Libya also said they had created a new oil marketing company in a bid to restart crude exports from that part of the North African country.

Zeidan has previously ruled out force to end the blockades at the eastern oil export terminals of Es Sider, Ras Lanuf and Zueitina, and at large oil fields across the country.

"We give groups a week to 10 days and then the government will exercise its function," Zeidan said, according to a transcript posted on his website.

"We will not announce [the action], but you will know when it is implemented," he said.

"We will not accept people holding the oil fields in this manner, and we will act appropriately," Zeidan said.

He also called on ordinary people to rise up against the protesters.

"People should go out on the streets and call for the oil fields to be opened," he said.

Libyan authorities have said that the country is losing some $130 million each day in revenues from the oil sector crisis.

"The budget is based on full-year oil revenues," Zeidan said. "In the next months we could have difficulty covering our spending. Because of the oil disruption we may find ourselves in deficit." EASTERN AUTONOMY

The Libyan prime minister's deadline for action follows two different groups forming independent governments for the Cyrenaica region in eastern Libya.

Ibrahim al-Jathran, head of the Petroleum Defense Guards and the instigator of the blockades at the Es Sider, Ras Lanuf and Zueitina oil terminals, formed the Political Bureau of Cyrenaica (PBC), while another group created the Cyrenaica Transitional Council.

The PBC at the weekend said it had formed a new entity to market crude independently of state-owned NOC.

The new company will reportedly look to sell oil out of Tobruk near the Marsa al-Hargia terminal.

There had been hope of a breakthrough in the east in late October when NOC lifted force majeure on crude exports from Marsa el-Hariga after the security situation at the port improved.

NOC declared force majeure on loadings out of Marsa el-Hariga on September 12, saying the port had been unable to carry out crude loadings because of circumstances beyond its control.

However, there have been reports that vessels have been unable to load at the port.

--Stuart Elliott, stuart.elliott@platts.com --Edited by Maurice Geller, maurice.geller@platts.com




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