As Libya seeks to restart oil exportation and revive its ailing economy, the country’s national oil corporation chief Mustafa Sanalla says the government needs to spend in order to boost the much needed oil revenue.
Libya’s Government of National Unity has an ambitious plan to increase oil output by five-fold by the end of this year but current production has been reduced to a paltry 207,000 bpd from a high of 1.6 million bpd, before the start of civil war five years ago.
Sanalla says that the corporation is targeting to receive about $1 billion which could jump-start the vital sector of the economy. But even after presenting it’s budget to the presidential council at the begining of July, the funds are yet to be allocated.
The north African country sits atop Africa’s largest oil reserves estimated at 48 billion barrels, but paradoxically it is the least producing OPEC member state.
Exacerbating the situation is attacks by Islamist militants on key oil installations.
However, there’s a glimmer of hope as the unity government agreed with an armed brigade in July, to reopen two major oil ports the Es sider and Ras Lanuf which have the potential to add 600,000 bpd.
In early August, Sanalla expressed fears that the promise to reopen the blockaded oil ports could be broken ,arguing that in the past there had been agreements with petroleum guard facilities that had not been met.
Western governments including those of Germany, Spain, US, France Italy and the UK have demanded that the control of all oil facilities be returned to the UN backed unity government without delay.