Friday, April 29, 2016

Rival eastern oil company in Libya tries to ship oil illegally

The Al-Thinni government of the Tobruk-based House of Representatives (HoR) is planning to export 650,000 barrels of crude that were pumped from the Messia and Sarir oil fields at Hariga port in Tobruk.

According to Omran al-Zwai of the Arabian Gulf Oil Co. tanker Distya Ameya is due to sail on April 25 to Malta. The cargo was sold to DSA Consultancy FZC, a company that is based in the United Arab Emirtates (UAE) according Nagi Elmagrabi, who heads the breakaway National Oil Company in the east. The internationally recognized National Oil Company is based in Tripoli and is cooperating with the UN-brokered Government of National Accord (GNA). International traders such as Glencore deal with it.
Three of the main oil ports in the east are guarded by the Petroleum Forces Guard led by Ibrahim Jodhran. He supports the GNA and would export through the Tripoli-based NOC. He does not control the Hariga port however. General Haftar the commander in chief of the Libyan National Army of the Al-Thinni government, no doubt wants the HoR to export oil so as to provide funds for the Al-Thinni government. Funds can be deposited in a separate branch of the Central Bank of Libya under control of the HoR. Ironically, Jodhran himself has tried to illegally ship oil by a tanker called the Morning Glory and also supported the eastern oil company before deciding to support the GNA and Tripoli NOC. He is a bitter foe of General Haftar.
A few days ago, the Tripoli NOC issued a statement on the situation saying that they had notified the Presidency Council of the GNA of the attempt by the Al-Thinni administration to illegally ship oil: Musfafa Sanalia NOC chairman said:“Agoco, our subsidiary in the east, was instructed yesterday by a Beyda official to load a ship at Marsa el-Hariga, I notified Prime Minister Serraj and the Presidency Council, who understood immediately the seriousness of the issue and took the necessary steps to stop the vessel from loading. Agoco employees and port officials understood this was a political attempt to divide the country, and I am very proud that they resisted the pressure to load this vessel. This had the potential to be a very ugly incident and I am pleased that it has been resolved peacefully without injury to anybody or loss of revenue or damage to the integrity of NOC or the country.”
Sanalia pointed out that the attempted export breached United Nations Security Council resolution 2278.
Sanalia said the NOC had been in contact with the captain of the ship and informed him that he is breaching the UN resolution. The NOC asked him to leave Libyan waters immediately. In response the captain turned off the ship's tracking system. It seems that the ship may be loaded and ready to set sail. A recent tweet says: "Chairman of NOC East confirms 1st crude oil shipment from #Tobruk's Hraiga port. distant pic of the tanker". It is quite possible that the tanker may be intercepted by the US or Italian navy.
Before the 2011 overthrow of Gadaffi, Libya pumped about 1.6 million barrels of oil a day. It now produces only 361,000 barrels a day.
The illegal export of the oil is a serious challenge to the UN and the GNA. The eastern branch of the Libyan National Bank is also planning to print its own banknotes. A recent article by Richard Galustian in the Times of Malta, suggests that Libya could be headed for a breakup between the west and the east. Significantly, Russia has refused to recognize the GNA until a vote of confidence from the HoR. There could be a conflict developing between western supporters of the GNA and supporters of Haftar and the HoR including Egypt, the UAE, the Arab League and now it seems Russia.