According to Gibson Shipbrokers, Libya is planning to build a new port suitable for VLCCs to berth. The port will aspire to leverage its strategic location for vessels travelling between Asia and Europe through the Suez Canal and to and from the US.
VLCCs have not fully loaded in port for more than 5 years because of a build-up in silt at the Es Sider terminal. Now, the Libyan Seaport Authority have recently agreed to partly fund, with the US based Guidry Group foundation, a $1.5 billion grant for the construction of the project on the eastern city of Susah.
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The harbour has a natural depth of 18 metres, only a few metres short of what is necessary for a fully loaded VLCC. Local neighbours Sudan and Chad have reportedly also welcomed the project stating their intention to use it. The port aims to capitalize on being strategically placed for vessels travelling between Asia and Europe via the Suez Canal and to and from the US.
This news come a time of turbulence for Libya. In 2010 Libyan oil production topped 1.6 million b/d, 9 years on and crude output since has experienced difficulties to come close to sustaining anywhere near that. In 2018, it seemed like progress had been made, as production averaged almost 1 million b/d, showing signs of a potential recovery.
With the country effectively split in two and rebel groups holding significant power – both in the east and west – oil facilities have at times been used as monetary and political bargaining tools for different groups to appropriate power.
However, commenting on this, the chairman of state oil company NOC, Mustafa Sanalla, indicated their intent to increase production to 2.1 million b/d by 2021, over 1 million b/d more than current levels, while also investing over $50 billion in infrastructure.
Mr. Sanalla also expressed their desire to encourage foreign investment, stating that he will visit China in the first quarter of 2019 to formally discuss investment into Libya’s oil and gas production opportunities.
