Libya can produce petrochemicals for local use even in crisis

Despite the turmoils, Libya's Eastern part where only about 1.4
million people live is still capable of producing petrochemicals for
local consumption. Petrol as well as cooking gas.

Sabah, which also produces light petroleum and gas, cannot produce
anything for local consumption. Everything has to be exported to
Malaya 1000km away. Sabah has a much higher population of 3.4 million
than even this eastern part of Libya.

Even in times of crisis, oil production is not affected. It is the
lack of shipping that is hindering export of oil and gas.

I wonder where the money goes to. With the sanctions on Gaddafi's
regime, the money should go to the interim government of Libya in
Benghazi.

http://www.npr.org/templates/story/story.php?storyId=134090660

Turmoil Rocks Libya's Oil Sector, Slashing Output

by The Associated Press

BREGA, Libya February 26, 2011, 08:05 pm ET

The massive oil terminal at Brega feels strangely deserted for Libya's
second-largest hydrocarbon complex. After more than a week of turmoil
in the country, production has been scaled back by almost 90 percent
with many employees fleeing and ships not coming to collect its
products.

The most activity on the site Saturday appeared to be a squad of boys
from the nearby town finishing the job of tearing apart the local
headquarters of Moammar Gadhafi's Revolutionary Committee.

The seaside Brega complex, some 125 miles (200 kilometers) west of the
rebel stronghold of Benghazi, collects crude oil and gas from Libya's
fields in the southeast and prepares it for export. It also produces
some petrochemicals and refined products for local consumption.

Since the crisis began on Feb. 15, however, General Manager Fathi
Eissa said the facility has had to scale back production dramatically
from 90,000 barrels of crude a day to just 11,000.

There are no reliable figures about the impact of the uprising against
Gadhafi on Libya's oil exports, but facilities across the country have
been forced to make sharp cuts. Most Libyan ports — the main method of
export — also were closed due to bad weather, staff shortages or
production outages, according to the International Energy Agency.

The IEA, citing reports from Western producers, said overall crude
production has dropped from 1.6 million barrels per day to 850,000.
The unrest in the OPEC nation — which ranks about 17th among world oil
producers and has Africa's largest proven oil reserves — has sparked a
major spike in world oil prices.

At Brega, the huge spherical storage containers and reservoirs used to
hold natural gas and crude oil are filling up rapidly with no ships to
cart away their valuable contents.

Production in the southern fields has been throttled back until Brega
can clear some of its capacity.

"At this time we are operating with the minimum required number of
operators, technicians mainly," Eissa said. "The production from the
fields right now is at minimum, it is not completely stopped but it is
minimum."

On Saturday, a ship arrived to collect some ammonia and methanol, but
it was one of only a few since the troubles began.

Brega has continued to pump natural gas for local consumption along
the coastal pipeline that is keeping the power plants and desalination
plants running, as well as providing the people with cooking gas
canisters.

Ahmed Jerksi, the chairman of the manager's office and a 40 year
veteran of the company, estimated the terminal was operating with just
45 percent of its normal manpower.

Many employees left amid rumors that Gadhafi was going to bomb the
plant and its volatile contents, while others feared for their
families, he said.

The neighboring petrochemical complex of Ras Lanouf, some 60 miles
(100 kilometers) to the west has experienced similar drops in manpower
and has had to cut production down to similar levels, Jerksi said.

Ras Lanouf is also perilously close to the town of Sirte, one of the
last holdouts for Gadhafi loyalists in central Libya, raising concern
about clashes in the area.

The Gulf of Sidra is critical to Libya's energy exports. The ports of
As Sidra, Marsa el Brega, Ras Lanuf, Tobruk and Zuetina handle about
77 percent of Libya's oil exports. Allegiances in the Gulf of Sidra
and the economic value they represent, therefore, are key to the
survival of Gadhafi's regime.

Libya's uprising came to the Brega complex on Feb. 20 when inhabitants
of the nearby village appeared at the gates and said the complex was
now with the revolution. The facility's guards let them in and they
went around and tore down the many pictures of Gadhafi.

The local headquarters of the Revolutionary Committee was also
trashed, with air-conditioning units pulled out of the walls and a
large-screen projection TV knocked over.

By Saturday, a group of youths had little to do besides smash windows
and set fire to a picture of Gadhafi.

"We are with the revolution," said Eissa, the general manager. "We are
supporting the change by keeping operations running to avoid the
country's collapse."

Many of Brega's 600 foreign workers — mostly from Britain and other
European countries — were preparing to evacuate. The British frigate
HMS Cumberland, which took evacuees from Benghazi to Malta, is set to
return to pick up many of Brega's workers. They missed an earlier
evacuation at Benghazi because of the poor state of communications in
the country.

Marianne Steeley of Britain has been working on and off at Brega since
1981 and is hoping her absence won't be long.

"Everybody's erring on the side of caution and they've certainly
dialed down the oil and gas operation here and the ammonia plant,
everything's been sort of kept on a very cautious level," she said. "I
think they are trying desperately to get things going as soon as
possible, I would certainly be very happy to return once things are
sorted."