Libyan El Sharara oilfield in shutdown from pollution protest

TRIPOLI/BENGHAZI, Libya - Libya’s giant El Sharara oilfield has been shut down because a landlord closed a valve in protest against pollution near a pipeline crossing his land, he told Reuters.

The closure, which was confirmed by an oilfield engineer and a separate Libyan oil source, is a major blow to the North African country a little more than a week after the nearby El Feel oilfield was closed by a protest.

“I closed the pipeline that crosses my land. The land is six hectares and it has become wasteland,” said Hassan Mohamed al-Hadi, the landowner in the western Zintan area.

“We closed the pipeline last year for the same reason. A number of mediators had intervened to persuade me to reopen it within 20 days for cleaning the land, but unfortunately the same thing has returned.”

Flows from El Sharara in the south of the country were not getting through to the Mediterranean port of Zawiya, an oilfield engineer said, confirming the closure.

The El Sharara field has closed several times because of protests by security guards over pay, as well as protests by other groups, part of turmoil gripping Libya since the toppling of Muammar Gaddafi in 2011

The field has capacity of 340,000 barrels per day (bpd) but an oil source had put output at 308,000 bpd last week. National Oil Corporation (NOC) operates Sharara in partnership with Repsol, Total, OMV and Statoil.

Repeated and long shutdowns cause pressure in the oilfield’s wells to drop, reducing production capacity.

Boosting capacity at the field requires much-needed investment that NOC has been struggling to secure.

In addition, NOC and the state in general have cut back on many services as oil revenues have dropped.

“The National Oil Corporation does not stand to its responsibility and clean the land as happened before 2011,” said Hadi, the landowner.

In addition to being one of Libya’s main export grades, Sharara also feeds the 120,000 bpd Zawiya oil refinery in the west of the country, currently the largest operating refinery.

A week ago NOC declared force majeure on the 70,000 bpd El Feel after a protest by guards closed the field, which is operated by a joint venture between state-owned NOC and Italy’s Eni.

Crude from El Feel is blended with condensate from the Wafa field to form the Mellitah blend, which is exported from the Mellitah terminal.