Dubai firm to restart Libya oil flow

The Dubai company in charge of Libya's biggest refinery is preparing to restart operations just weeks after an attack at its gates killed 17 people.

Al Ghurair Energy is a partner with the state producer, National Oil Company (NOC), in the refinery in the port city of Ras Lanuf. Since February, the facility has been shut down, said Sultan Al Ghurair, the director of business development at Al Ghurair Energy.

"They are still in an unstable situation," Mr Al Ghurair said on the sidelines of an energy conference in Dubai. "We are very patient … We are with Libya and we have to adapt to the environment."

Situated on the coast between Colonel Muammar Qaddafi's hometown of Sirte and the rebel stronghold of Benghazi, Ras Lanuf has been a flashpoint in the war between rebels and loyalists.

Rebels took control of the refinery in August, but last month forces attacked it and killed 17 people.

"It's an isolated incident," Nouri Berouin, the chairman of NOC, told Reuters after the attack. "I don't think it will be repeated. We are preparing to give more protection to installations."

Mr Al Ghurair declined to comment on the attack but said Libyans locally were providing security. Some small storage tanks were damaged but otherwise infrastructure was intact, he said.

"Our refinery is in good shape - very good shape - and we're working to get it up and running," he said. "It is very important for the local economy because there are demands for the products locally."

Before the uprising, the refinery processed 220,000 barrels per day (bpd) of crude and sent its oil products to nearby petrochemical plants and onward to European markets.

Al Ghurair Group, the parent company of Al Ghurair Energy, began working in Libya in 2009, when NOC chose it to carry out a US$2 billion (Dh7.34bn) upgrade of the refinery and take on half ownership of a new company called the Libyan Emirati Refining Company. Al Ghurair Group and NOC each agreed to put $175 million into the joint venture.

Yesterday, Mr Al Ghurair said the construction work to increase the refinery's output and allow it to refine more expensive products would take at least two years.

At present no crude is flowing to the refinery.

Libya, an Opec member, pumped 1.6 million bpd before the civil war. Amid the fighting, that figure sank to as low as 60,000 bpd. The loss of production of Libya's highly-valued sweet crude affected global energy markets and divided Opec.

The same factors that have affected the refinery - damage from fighting, fears of loyalist attacks and the lack of foreign engineers and skilled workers - have dampened prospects for raising the country's production.

International companies have nevertheless been eager to return, with Italy's Eni and France's Total the first to resume pumping late last month.

Libyan production is back up to 350,000 bpd and could reach pre-conflct levels within 14 months, Mr Berouin was quoted as saying in Petroleum Economistmagazine yesterday. He predicted exports would reach 400,000 bpd within two weeks.

Another UAE company, Al Maskari Holding, is waiting for a new government to be formed in Libya so that it can revive work on a planned $3bn energy hub and separate solar power plant.

ayee@thenational.ae

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