Libya: PC takes over management of Libya’s oil wealth, NOC relegated
The Presidency Council (PC) established under the Libya Political Agreement has issued a decree watering down the influence of the state-owned National Oil Corporation (NOC) over the country’s oil wealth.
The decree uplifted the PC to the level of manager of the country’s oil resources, making it responsible for the supervision and exploitation of the oil wealth and a signatory to all projects linked to it. The reason for the decision is yet to be known but henceforth, the UN-backed authority will have to approve Exploration-Production Sharing Agreements and NOC recommendations related to the abandonment of production franchises.
The decree coincided with a released statement from the NOC warning “a group of individuals abusing the current status of political division in Libya by entering into illegal contracts with unknown or unqualified companies” to sell Libyan crude oil “at huge discounts below the official selling price”. It called on these “identified” individuals and their associates to stop such practices.
It is unclear if the decree was taken in this vein as it limited NOC’s actions to proposing operational plans, and “controlling the production amount and export processes.” The PC will henceforth control the pricing of oil and gas and derivatives and will oversee the security and protection of oil resources.
Meanwhile, the effectiveness of the decree is being questioned by analysts because the PC has limited authority in Libya due to the lack of military presence in some of the troubled areas especially around the oil crescent. Most of the oil ports are under the control of militias that are not directly under the control of the UN-backed government.
The illegal sale of oil could help fuel a war that seems to elude any tangible peace plan proposal for the moment.
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