February 19, 2018 / 10:38 PM / 7 months ago

Libya's NOC says budget delays may lower oil production

TUNIS (Reuters) - Libya’s National Oil Corporation (NOC) is suffering ongoing delays in receiving budget money from the government and this could reduce production, the head of the state company said on Monday.

Mustafa Sanalla made the comments after meeting the head of Al Jouf Oil Technology Company, who said the NOC subsidiary was suffering from financial problems that had delayed projects and salary payments.

“The entire sector is suffering from these problems because of delays in the finance ministry disbursing budgets to the corporation for this year,” Sanalla said in a statement from the NOC.

“This slowdown will create negative consequences for the whole sector leading to a large decline in the level of production once more and a negative impact on development projects in the oil sector.”

The NOC, which has raised Libya’s oil production to more than 1 million barrels per day (bpd) from lows of around 200,000 bpd in 2016, receives its budget through the central bank and the internationally recognised government in Tripoli.

Sanalla has repeatedly complained in the past about late and partial budget payments, which he says have hampered output.

Libya’s production remains well below the 1.6 million bpd it was producing before a 2011 uprising that led to armed conflict between rival factions, with competing governments set up in Tripoli and the east of the country.

Reporting by Aidan Lewis; editing by G Crosse and Lisa Shumaker

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