Libya’s NOC declared force majeure on several Es Sider crude cargoes, sources say

LONDON: Libya’s NOC late last week declared force majeure on several crude cargoes loading from the Es Sider port, with oil production curtailed by a political standoff over the central bank and oil revenue, four trading sources with knowledge of the matter told Reuters.
The state-owned National Oil Corporation (NOC) did not declare force majeure on all loadings for the port, a measure that would have shut all loadings, two of the sources said.
NOC was not immediately available for comment.
The crisis was triggered when western factions moved on Aug. 18 to oust veteran central bank governor Sadiq Al-Kabir, who has since fled the country. Eastern factions responded by declaring a shutdown on all oil output on Aug. 26.
The central bank is the sole legal depository for oil revenue and pays state salaries across the long-divided country.
It was not immediately clear how many cargoes were subject to force majeure, but one source who had a cargo canceled said it was several.
“It’s not a complete shutdown, some cargoes will load,” the source said.
Force majeure is declared when unforeseeable events prevent someone from fulfilling a contract.
Some tankers have been allowed to load crude from storage at Libyan ports. An NOC source told Reuters that those cargoes were to fulfil contractual obligations and avoid financial penalties.
The tanker Energy Triumph is loading about 1 million barrels at Hariga port, Kpler data showed and engineers at the port said. Kpler data estimates that it will depart on Monday.
Pacific Pearl, expected to load from Es Sider, is still anchored and awaiting berthing instructions, Kpler told Reuters.
Kriti Samaria loaded more than 700,000 barrels at Zueitina last week and departed on Sunday while Front Jaguar loaded about 600,000 barrels from Brega port last week and departed on Friday, Kpler data showed.
NOC said on Aug. 28 that oil production had dropped by more than half from typical levels to a little more than 590,000 barrels per day (bpd). It was not immediately clear where production levels now stand.
Reuters reported on Sept. 1 that the the Arabian Gulf Oil Company (AGOCO) ordered production to resume at the Sarir, Messla and Nafoura fields, which it controls.
A Kpler report said it expects the east-west standoff to persist throughout September, with AGOCO continuing to produce at about 100,000 to 150,000 bpd to meet domestic needs.
AGOCO’s production has risen to nearly 200,000 bpd, engineers told Reuters on Monday. It was producing 290,000 bpd on July 20, NOC has said.
NOC said late on Sunday that fuel and gas continue to be supplied to power stations as normal, adding that it was “working to provide the required fuel and gas needs according to the capabilities available, taking into account the operational and production conditions.”