Libya’s Biggest Oil Port May Reopen

Libya’s Biggest Oil Port May ReopenLibya’s Biggest Oil Port May Reopen

Libya’s biggest oil port could resume operations in two weeks as fighting in the area recedes amid increasing competition between the divided North African nation’s rival governments for the control of crude exports.

Al Mabrook Bu Seif, the chairman of state-run National Oil Corp. appointed by the elected government in the east of the country, said his team will start contacting existing clients to coordinate crude loadings at oil ports, replacing the company’s rival management in the capital, Tripoli, where a cabinet backed by militias is ruling over most of the western region, Reuters said in a report.

“Our management and marketing team are ready to deal with our existing clients and partners,” Abu Seif said in an interview Saturday in the eastern city of Al-Bayda, the seat of the internationally recognized government of Abdullah al-Thinni. “We will start contacting them,” he said, without mentioning specific companies. Libya, holder of Africa’s largest oil reserves, has been split since last year when a coalition of militants captured Tripoli, forcing the elected government to move to the eastern region. The conflict has damaged or shut oilfields, pipelines and ports.

  Rerouting Oil Money

Thinni announced late on Saturday he had authorized his government's oil corporation to open a separate bank account in the UAE for oil revenues, and to seek independent oil sales. Until now, oil sales and revenues have gone through Libya's central bank and the National Oil Corp. in Tripoli, which says it wants to stay out of the conflict between the two governments. Thinni's government has made several announcements about a new payment system for the oil sector, but analysts say it will struggle to convince international traders it is legally entitled to claim ownership of Libyan crude.

He said his government would open representative offices of its NOC in the US, Britain and Germany, and carry out swaps of Libyan crude for refined products and fuel to provide basic supplies.

Seeking separate oil transactions would likely exacerbate the conflict with the Tripoli administration, which was set up by Libyan Dawn forces who took over the capital in the summer and forced Thinni's government to withdraw to the east. Introducing a new payment mechanism would also mean breaking up the central bank system, the only source of hard currency for importers. It is also one of the last institutions left untouched by the power struggle, paying public salaries across the country.