Libyan government and oil guards reach agreement to reopen ports

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BENGHAZI, Libya (Reuters) – Libya’s UN-backed government has signed an agreement with an armed brigade controlling the main oil ports of Ras Lanuf and Es Sider to end the blockade and restart exports from terminals closed since December 2014.

File photo of smoke rising from burning oil storage tanks in the port of Ras Lanuf, Libya January 23, 2016. REUTERS/Stringer

Reopening ports would be a big step forward for the North African state which since the fall of Muammar Gaddafi in 2011 has descended into chaos that has reduced its oil production to less than a quarter of oil levels. before 2011 of 1.6 million barrels per day.

No specific date has been set for the restart of exports, but a quick recovery would be hampered by technical damage caused by militant attacks and opposition from the National Oil Corporation, which has resisted paying cash. to reopen the ports.

Deputy of the Libyan Presidential Council Mousa Alkouni signed the agreement Thursday evening with Ibrahim al-Jathran, commander of the guards of the oil installations, one of the several Libyan armed brigades which control the terminals.

“I think the recovery now depends on the technical part … and I also think it will happen within a week to two weeks, but no more,” Alkouni told Reuters by telephone.

He said the deal included paying an unspecified amount in salaries to the Jathran forces. He said they had not received a salary for 26 months. Their role is to protect oil ports, although critics said they used it to extort money from Tripoli.

In a statement released later on Friday, Alkouni said there was “absolutely no truth to the rumors that the resumption of oil exports was the result of extortion or deals.”

Rival governments and a complex web of armed groups that once fought against Gaddafi and have quasi-official status are vying for power and control of the country’s oil wealth, shutting down pipelines and fighting over export terminals .

Ali Hassi, a spokesman for the Jathran PFG brigade, said no date had been decided for the reopening of the ports as it would depend on the National Oil Corporation. But he confirmed that an agreement had been signed between the council and Jathran.

Jathran’s brigades led port blockades from 2013, saying he was trying to prevent corruption in oil sales, although others have disputed his motives. He also called for more autonomy for his eastern region.

The opening of Ras Lanuf and Es Sider would add a potential capacity of 600,000 barrels per day to Libya’s crude exports, although experts say the damage from the fighting and the long shutdown must be repaired before shipments are again at full capacity.

The NOC said damage from recent Islamic State attacks, which have spread across the country in chaos, meant ports would struggle to top 100,000 bpd in the near term.

Beyond the technical issues, NOC chairman Mustafa Sanalla also opposed any deal with Jathran, saying it was a mistake to reward the brigade commander by paying to end his port blockade. tankers.

Sanalla said a deal that included payments would encourage other groups to disrupt oil operations in hopes of a similar payment. The NOC also threatened to withdraw its recognition from the Presidential Council.

Eurasia Group analyst Riccardo Fabiani said the deal was likely to hold, unlike previous attempts to reopen ports, because both sides had a stake in it working.

Faced with resistance from extremists and protests over living conditions, the presidential council needs oil revenues to improve services and economic stability to bolster its legitimacy. Jathran is also increasingly politically isolated and has decided to side with the council.

“Despite recent attempts by the Tripoli-based NOC to undermine the deal, the unity government has decided to prioritize reopening ports,” Fabiani said. “This deal will provide the authorities in Tripoli with much-needed revenue and is a relatively easy political victory.”

Additional reporting by Ahmed Elumami in Tripoli; written by Patrick Markey; Editing by David Evans, Toni Reinhold

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