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Libya gas exports to Italy halted after militias clash

MYT 11:55:01 PM

TRIPOLI (Reuters) - Gas exports to Italy from the Mellitah complex in northwestern Libya have been suspended since Saturday following clashes between rival militias in the area, Libya's National Oil Corporation (NOC) and Italy's Eni said.

The logo of oil company Eni is pictured at its San Donato Milanese headquarters near Milan February 5, 2013. REUTERS/Stefano Rellandini
The logo of oil company Eni is pictured at its San Donato Milanese headquarters near Milan February 5, 2013. REUTERS/Stefano Rellandini

Mustafa Sunalla, an NOC deputy chairman, said NOC officials, the Libyan prime minister's office and defence ministry were holding meetings to try to resolve the situation.

"Gas exports have been completely halted," he told Reuters on Sunday.

Thousands of former rebels who fought to overthrow Muammar Gaddafi in a 2011 conflict have been employed in a special protection force to look after the North African country's oil and gas installations.

But in recent months activists and local militia have disrupted operations in Libya's main industry, pursuing political and social goals such as better living conditions or more regional autonomy, and in July forced the closure of three major oil terminals.

This has hurt OPEC member Libya's oil output which returned to close to pre-war levels of 1.6 million barrels per day (bpd) faster than analysts expected after the 2011 conflict.

Italian oil and gas giant Eni operates Mellitah in a joint venture with the NOC. Eni's production at the site is about 115,000 barrels of oil equivalent per day, an industry source said.

Mellitah supplies Italy with gas through the Greenstream pipeline. Italy gets the majority of its gas from Algeria, Russia and Norway, with Libya providing about 10 percent of its gas demand.

At full capacity Greenstream provides at least 8 billion cubic metres of gas, and upgrade work is under way.

Eni said gas flows from Mellitah had been halted for security reasons and Italy's industry ministry had been alerted.

About 22 km (14 miles) east of Zuwara, the Mellitah complex consists of two plants - one for treating oil and condensate production from the Wafa fields and another for gas and condensate from the Sabratha offshore platform, according to Mellitah's website.

A senior Libyan oil industry source said production at both Wafa and Sabratha had been affected by the Mellitah shutdown.

Saturday's firefight began after an argument escalated between former rebel fighters from Zuwara and those guarding Mellitah, who are from the town of Zintan, further away from the complex, a security source said.

The clashes were now over, the source said.

It was not immediately clear what had caused the dispute but a Zuwara resident said on Sunday that tensions had been escalating for days.

"There were two bouts of fighting yesterday. Now there is no shooting but it is possible there could be more fighting," said the resident, who gave his name as Ayub.

"From what I understand, some of the Mellitah staff were evacuated, others came to Zuwara by boat from there."

Ayub said militias loyal to Libya's defence ministry, who had initially been despatched on Saturday to resolve the fighting, were no longer on the scene.

(Additional reporting by Stephen Jewkes in Milan; Writing by Marie-Louise Gumuchian and Silvia Aloisi; Editing by David Cowell)


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