Libya: Eni and BP Agreement
Libya exploration and production sharing agreement. Source: BP.
Since the fall of Ghadaffi, Libya, once one of the world’s top oil suppliers, has struggled to keep up supply levels, with exploration in many areas still suspended. The country is now producing around 1.25 MMbopd, well below its pre-civil war capacity of 1.6 MMbopd. The recent signing of a Letter of Intent with Libya’s National Oil Corporation by supermajors Eni and BP is therefore an interesting development.
In 2007 BP signed an exploration and production sharing agreement (EPSA) to explore onshore in the Ghadames Basin and offshore in the Sirt Basin, a total of about 54,000 km2, but did not progress towards production before it ceased operations in Libya in 2011 due to civil unrest. With this new agreement Eni plans to acquire a 42.5% interest in BP’s Libya assets and will become operator of the EPSA, where BP currently holds 85% working interest, with the Libyan Investment Authority holding the remaining 15%. Eni has been operating in Libya since 1959 and is currently active in six contract areas in the country, producing 384,000 boepd in 2017. It is also involved in programmes to support local communities, in areas like health, water and energy access.
