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London - National Oil Corp in western Libya warned traders against loading “illicit” cargoes of oil at Hariga port in the eastern part of the country, while the company’s counterpart in the east acknowledged it’s signed 10 contracts to export crude from the terminal.
Six or seven foreign companies signed oil-purchase contracts with people who say they represent the government based in eastern Libya and “have no authority to sell Libyan oil,” the Tripoli-based NOC said in a statement, citing Ahmad Shawki, general manager for international marketing. It identified Loyd Capital and Netoilas among buyers attempting to load crude at Hariga. “The only authority legally empowered to sell Libyan crude oil is the National Oil Corporation, with its seat in Tripoli,” NOC said.
Libya, which holds Africa’s largest proven oil reserves, has two administrations, one in the west and an internationally recognized government in the east. The NOC in the west is recognized by traders such as Glencore Plc and Vitol Group as the official marketer of Libyan oil. The eastern government has set up a separate NOC administration, which represents Libya in matters relating to oil including OPEC. The eastern National Oil Corp. said Friday it was seeking to hire a UK law firm to sue the NOC in Tripoli.
Impoundment threat
“Tripoli isn’t internationally recognized and so they don’t have the power to say who is and isn’t authorized to sell crude,” Loyd Capital Management LP chief executive officer Edward Loyd said Friday in a phone interview. Loyd plans to send oil to refiners in two “western-leaning governments,” and three shipping companies have agreed to lift crude for Loyd on condition that it provides necessary documentation, he said.
NOC with headquarters in Tripoli advised shipowners to “verify whether charterers’ contracts are legitimate, or run the risk of having their ships impounded,” it said in the statement on Sunday.
Libya produced about 1.6 million barrels a day of crude before the 2011 rebellion that ended Moammar Al Qaddafi’s 42- year rule. It’s now the smallest producer in the Organization of Petroleum Exporting Countries, pumping 370 000 barrels a day, data compiled by Bloomberg show. Since Qaddafi’s ouster and death, various armed militias are also competing for control of oil facilities.
The eastern NOC is seeking to hire a UK law firm to sue NOC in Tripoli, Nagi Elmagrabi, chairman of the NOC in east, said by phone on Friday. It has signed 10 contracts, with exports to start in two weeks from Hariga, he said.
Netoil “always follows commercial opportunities within the boundaries of the law,” the company said in an e-mailed statement on Friday. Eastern Libya “is under the control of the legitimate government in Tobruk,” it said. “We therefore shall not experience any issues with the continuity of the flow of supply and the exporting of the oil.”
