LIBYA - The Operators & Fields: The Foreign Oil Producers.

There are six foreign oil producers in Libya, having joint ventures controlled by NOC. Their total production now is averaging 588,000 b/d. In early 2004 they will be joined by Lasmo, a unit of Agip. Total oil production capacity by the foreign companies will reach 961,000 b/d by 2006 (see OMT).

Suspension of the UN's limited embargo in April 1999 has made life much easier for the foreign operators as they can now travel by air and get imported oil equipment in place without delay.

Agip North Africa & Middle East: Agip, an operator in Libya since 1959, has a number of blocks where it is exploring for oil and gas. It produces about 180,000 b/d from Bu Attifel and Rimal-Khatib group onshore and El Bouri offshore. Agip NAME is a 100% Channel Islands part of ENI group of Italy.

Agip's oil production capacity has fallen from 320,000 b/d in 1992 to 220,000 b/d, because it has not been able to import adequate EOR equipment. The worst affected is the Bu Attifel field, a giant requiring a water injection system because reservoir pressure has been falling since 1994. It is said that even if it manages to install an advanced EOR system at Bu Attifel, Agip's sustainable capacity is not likely to change much in the near future; but it would prevent a major fall in reservoir pressure.

Bu Attifel was found in 1968 at 14,300 ft on the eastern side of the Sirte Basin and was put on stream in late 1970. One of the deepest fields in Libya, it produces 41o API oil. It has 39 wells, of which about 30 are producers. Capacity has dropped from 170,000 b/d to less than 80,000 b/d.

Of the five discoveries made in Libya in 1990-1994, two were oil-rich structures near Bu Attifel found by Agip. The first one was found east of Bu Attifel and tested about 11,000 b/d of oil from the Nubian sandstone at 15,800 ft. The reservoir was said to contain 300m barrels. The second find south of Bu Attifel tested 5,000 b/d, with oil in place estimated at over 500m barrels. But the US sanctions prevented Agip from restoring Bu Attifel's output level to 170,000 b/d and raise it to 240,000 b/d by 2000, as was intended in early 1990. Rimal-Khatib are small oil structures near Bu Attifel found by Agip in 1965 at 14,000 ft. Their output is added to that of Bu Attifel.

A $234m gas separation and treatment plant at Bu Attifel started operating in late 1993. The plant was built by Snamprogetti and Bonatti in two years and four months. It has the capacity to treat 384 MCF/day of dry gas, with 291 MCF/d coming from Bu Attifel and 93 MCF/d from the Nafoorah and Jisarah fields, as well as produce 25,000 b/d of condensates. The gas is transported by a 132-km pipeline to Marsa El Brega. As part of Bu Attifel development projects initiated since 1990, NOC has built a 140 km pipeline carrying 30,000 b/d of condensates from Bu Attifel to the coast.

El Bouri, in the Pelagian (Tripolitanian) Basin, is Libya's first offshore field with a huge cap of gas. Found in 1976, it is located on Block NC 41-B, a 37,700 sq km tract in the Libyan sector of the Gulf of Gabes. It lies under the sea at a depth of 8,700 ft, producing 26o API oil. It is under 170 metres of water, 150 km north-west of Tripoli. The field covers an area of 32 km by 5 km. It is said to contain about 4-5 bn barrels of oil and 2.5 TCF of gas in place. Recoverable oil reserves have been estimated at about 650m barrels. The field is near the 7th November Block which is equally owned by Libya and Tunisia and operated by a Nimir-led JV.

El Bouri came on stream in August 1988 at the rate of 12,000 b/d. A $2 bn development programme had been agreed between NOC and Agip in March 1983. The first phase involved the drilling of 50 wells from two offshore platforms (DP3 & DP4) supplied by Belleli and Micoperi for $230m. By end-1988 production had risen to 20,000 b/d. In 1989 it rose to 60,000 b/d, after 23 new wells were hooked up. Another 27 wells drilled in 1990-91 raised capacity to 70,000 b/d by mid-1991. Drilling, processing and service units for the platforms were provided by Saipem and Hyundai under a $155m contract. A 1.3m barrel floating oil storage and mooring facility was supplied by Equipements Mecaniques et Hydrauliques of France. John Brown Offshore of Britain was the project manager.

In late 1993, Agip signed a wide-ranging agreement with NOC under which, among other things, it was to embark on a second phase for El Bouri to expand its capacity to 150,000 b/d. This required 55 more wells from three new platforms - DP1, DP2 and DP5. The target was reached in 1995. But the field's output fell later because it required EOR facilities and now it is averaging less than 70,000 b/d. El Bouri has had a high gas/oil ratio of some 800-900 cubic ft/barrel, which limits its recovery rate. The ratio was reduced in 1992 after the drilling of six horizontal wells. Since then there have been plans to bring the ratio down to about 600 cubic ft/barrel with a 15-well horizontal drilling project.

The late 1993 agreement with NOC improved the E&P terms to the extent that Agip was encouraged to expand El Bouri and acquire several blocks in the Ghadames and Sirte Basins. The terms reportedly included an increase in Agip's share of El Bouri's oil production from 19 to 30%.

Under the same deal, Agip did a feasibility study for the development of gas-rich offshore Block NC-41, adjacent to El Bouri, along with El Bouri's gas reserves and an onshore gas field called Al Wafaa. NC-41, north-west of Tripoli called Bahr Essalam which also contains oil, has a Pelagian fm with characteristics partly similar to that of El Bouri. Al Wafaa, found in 1991 by NOC's Sirte Oil Co., straddles the border with Algeria in the Ghadames Basin and is an extension of Algeria's Alrar gas field.

The study, completed in late 1995, recommended development of NC-41's and El Bouri's gas reserves and those of Al Wafaa for a stream of 10 BCM/year by 2005. Of this, 8 BCM/y will be exported to Sicily through a marine pipeline. The remaining 2 BCM/y is to be consumed in Libya. This $5.6 bn venture is called Western Libya Gas Project (WLGP), in which Agip Gas BV holds 75% and NOC has 25%. Related to it is the export pipeline venture called Greenstream, in which Agip holds 75% and NOC has 25%.

Agip Gas BV on Feb. 9, 2000 signed a 24-year contract to supply Edison Gas of Italy with 4 BCM/y. Later it signed deals to supply Gaz de France with 2 BCM/y and Energia Gas with the remaining 2 BCM/y. All three contracts have the take-or-pay clause.

Now Agip is moving full steam ahead on the WLGP and Greenstream, scheduled to be fully operational in mid-2005. Apart from the 10 BCM/y stream, the WLGP will be producing 60,000 b/d of crude oil, 39,000 b/d of condensates, about 15,000 b/d of propane and 13,000 b/d of butane.

The euro 1.2 bn EPC contract for building the Wafa desert and Melitah coastal treatment plants and storage facilities were awarded in early 2002 to a consortium of JGC, Tecnimont and Sofregaz. China National Petroleum Corp. (CNPC) is building twin 520-km onshore pipelines from Wafa to Melitah. ENI unit Snamprogetti, ABB Lummus Global and South Korea's Hyundai have the E730m job to build the 10 BCM/y grassroots gas treatment plant at Melitah. Saipem, another ENI unit, is laying a pipeline from Malitah to Sicily and a twin pipeline linking the Sabratha offshore platform to Melitah. Pipelaying should be completed in June 2004. Saipem, Cooper Cameron and Doris Engineering are supplying manifolds, templates, wellheads, umbilicals and other equipment for offshore work. The PMC which also has done the FEED work is Technip Geoproduction, which won a $100m contract on Dec. 9, 1999. The whole project will be completed by mid-2005.

Agip boosted its position in Libya with its takeover of Lasmo in December 2000. This gave Agip a stake in the giant Elephant oilfield in the onshore Murzuk Basin which will be on stream in 2004.

Repsol/YPF of Spain, in Libya since 1994, now is the second biggest foreign producer of oil in this country, with an output averaging 180,000 b/d from Al Sharara field. It has developed this field to a capacity of 200,000 b/d rising to over 250,000 b/d before 2005. Output is limited to 180,000 b/d in line with Libya's OPEC quota from June 1. Previously the output was 165,000 b/d. Oil in place at the field has been put at 2-5 bn barrels.

The field lies in the Murzuk Basin S-W of Libya in the 4,275 sq km Block NC-115, 800 km S of Tripoli. The light/sweet Sharara crude oil is exported by pipeline through the Zawiya terminal west of Tripoli, with direct exports having begun in mid-1998. Repsol has spent over $1 bn on developing the field. It put its first phase on stream in late 1996 at 50,000 b/d. In January 1999, Repsol found light/sweet oil near Al Sharara and the M1 well flowed at 2,500 b/d. The new reservoir was said to contain up to 200m barrels. Repsol holds 40% in NC-115 and its partners are Total (30%) and OeMV (30%). NOC owns 50% of the fields, as in the case of other operations involving foreign companies.

Repsol is spending $155m on development of Block NC-186's A field in the Murzuk Basin, which is expected to produce 40,000 b/d of 41o API oil in the first quarter of 2004 out of proven 140m reserves. NC-186, just north of NC-115 and covering 4,300 sq km, is ideally placed as the export pipeline from Al Sharara runs horizontally through to the north, and Repsol has spare processing and export capacity. NC-190 is just to the north of NC-186 and the export pipeline runs through it as well.

Repsol has made five discoveries at NC-186 since May 1998, with potential reserves exceeding 300m barrels. It had signed an EPSA for Blocks NC-186, NC-187 and NC-190 in November 1997. Last May it found oil on Block NC-190, with the well flowing at 700 b/d. But it has failed to find oil on the nearby NC-187. Being the operator and holding 32% in these tracts, its partners are Total (24%), OeMV (24%), and Saga Petroleum Mabruk - now part of Norsk Hydro - 20%). On Nov. 10, 1999, Repsol and its partners signed an EPSA with NOC for Block M-4 in the same basin to the north of NC-186.

A partnership of Repsol/YPF (60%, the operator) and OeMV (40%) in May 2003 signed an EPSA for a package consisting of M-1 Block in the Murzuk Basin, Mediterranean offshore Blocks O-9 and O-10, Block S-36 in the Sirte basin, and Blocks K1 and K2 in the frontier south-eastern Kufra area.

Petro-Canada of Calgary produces 95,000 b/d and has a capacity of 105,000 b/d in Libya which in 2004 will reach 114,000 b/d. The production consists of 15,000 b/d from its En Naga field, on Sirte Basin Block-177 which it purchased in 2001 from Lundin Oil of Sweden, and 80,000 b/d from a number of fields which it got in January 2002 after its acquisition of Veba Oil & Gas of Germany from BP. En Naga went on stream in March 2003 at the rate of 6,800 b/d. This has recently risen to 15,000 b/d and should reach a plateau of 24,000 b/d by early 2004. En Naga crude is pumped to the Samah oilfield complex via a 100-km pipeline. The field contains 85m barrels.

The operation acquired from Veba involve several small fields and the mature giant Amal which is depleting rapidly. Their total output has fallen from 85,000 b/d in 1992 (see Vol. 57, Gas Market Trends No. 2).

Wintershall, a unit of the German petrochemical giant BASF, operates several fields in Blocks NC-96 and NC-97 in the Sirte Basin. Their production is averaging 80,000 b/d and their capacity is 90,000 b/d. Its biggest field is As Sarah in the Jakhira zone, 450 km south-east of Benghazi, which it found in January 1989 on Block NC-96. The field's reserves were then estimated at about 250m barrels.

Total produces 33,000 b/d and its capacity by 2005 will reach 75,000 b/d. Production consists of 18,000 b/d from the onshore Mabrouk field in the Sirte Basin, and 15,000 b/d from the offshore B field on Block NC-137. Mabrouk field, in the Sirte Basin, was found in 1959 by Exxon. It was left undeveloped for over three decades because of its highly-fractured nature, low-pressure reservoir and low oil-gas ratio. Development costs were then estimated at $1 bn. The field's reserves were put at 1.3 bn barrels of 35-40o API oil. Total signed an accord with NOC in late 1993 to develop the field. It brought on stream in June 1995 a pilot EOR system based on water injection, enabling the field to produce at 2,000 b/d. This has since risen steadily. Total has a 75% working interest. Saga Petroleum holds 25%. Total is raising Mabrouk's capacity to 35,000-40,000 b/d by 2005/06.

B field on Block NC-137 came on stream early in 2003. The operation is from a new floating production, storage and offloading (FPSO) vessel, the Farwah, built by Izar of Spain for Exmar of Belgium and leased to Total for 12 years. The vessel, delivered in early 2003 and is linked to a fixed platform in 90 metres of water. It will have a 35,000 b/d capacity by 2005/06. B field, found in 1975 by Total and confirmed in 1998, is about 100 km off the coast near the Tunisian border. It produces 38o API oil. Total holds 75% in this with Wintershall having 25%. The field's five wells indicate about 150-200m barrels would be recoverable.

OeMV of Austria has been in Libya since 1985, when it bought 25% of Occidental's operations for $110m. These included Oxy's oil-rich Blocks 102 and 103 in the Sirte Basin. OeMV's output now averages only about 20,000 b/d from several small fields in the Sirte and Ghadames Basins, down from 40,000 b/d in 1992.

After Oxy left in June 1986, OeMV raised its E&P stake in Libya by taking additional acreage (see backgroud in Vol. 57, Gas Market Trends No. 2).

Agip (Lasmo) is developing the Elephant field, on Block NC-174 in the Murzuk Basin, which will be on stream in early 2004 at 50,000 b/d. This will be raised to reach 150,000 b/d by 2006.

Completion of the field's $500m project will be two years late. It was in October 2002 that the partners finally signed letters of award with MAN GHH of Germany for the gas-oil separation plant (GOSP) and with Athens-based Joannou & Paraskevaides (J&P) for a 75-km export pipeline, civil works and power supply.

The field, with recoverable reserves of 560m barrels, was first due to start up early in 2002. But the project was also delayed because of technical and personnel changes at NOC, among other problems.

ENI, through Lasmo and Agip, holds 33.3% in this venture. NOC has 50% and a group of South Korean companies hold the remainder. ENI hopes Lasmo's output could eventually reach 300,000 b/d.

Lasmo has come to an arrangement to use Repsol/YPF's link to the country's crude oil export pipeline on a temporary basis. The same partners have Block NC-173 in a nearby section of the Gulf of Sirte (see detailed background in Vol. 57, Gas Market Trends No. 2).

The 7th November Block, offshore in the Gulf of Gabes, is rich in oil and gas and is owned by the Libyan-Tunisian Joint Oil Co (JOC), a 50-50 venture of NOC and Tunisia's state oil company Etap. JOC, based on Djerba island, was formed in May 1988 after a territorial dispute over the block between Tunis and Tripoli ended with a ruling by the International Court of Justice. It took many years for real work on the block to begin.

The block was awarded in early 1997 to Nimir Petroleum Co. North Africa (a private Saudi firm), Petronas of Malaysia and Medex Petroleum of Tunisia to explore the 3,000-sq km area and later to develop the reserves which can be proven.

Nimir began seismic studies in April 1998. It was to drill at least three wells and spend $30m. The company drilled the first well in the second half of 2000. Shows then were established to be commercially unviable. It began drilling a second well in March 2001.

Nimir is the operator, holding 55%. JOC will take 39% of any profit. JOC says the block has a minimum of 260-300m barrels of oil and 250 BCM of gas. This is just north of El Bouri, south of the Isis gas field and west of Tunisia's Miskar gas field which BG has developed.