Eastern NOC in Libya tries to illegally sell oil

Libya

Published on 2016 April 28, Thursday Back to articles

Tobruk (c) gordontour, CC by 2.0

All eyes were on Tobruk last week. On 18 April the House of Representatives was set to vote on an amendment to the 2011 Constitutional Declaration incorporating the 17 December 2015 political agreement, as well as whether to recognise the Government of National Accord (GNA).

The political agreement was, however prevented once again, including through the possible physical intimidation of the lawmakers. House Speaker Aguila Saleh refused to hold an emergency session to vote again last week, but he said that he expected the vote to take place before 30 April.

In the meantime, on 21 April, the unrecognised eastern National Oil Corporation (NOC) illegally attempted to sell oil.

According to the rival NOC in Tripoli, it asked employees of the NOC’s Arabian Gulf Oil Company (AGOCO) subsidiary to load 650,000 barrels of oil onto a tanker at the Marsa al-Hariga export terminal outside Tobruk. AGOCO employees refused to do so because it would be illegal. The Tripoli NOC accused a Sharjah based company, DSA Consultancy FZC, of purchasing the oil. The UN sanctions committee was alerted about the incident which violates UN Security Council Resolution 2278.

However, one of the challenges is that, while most Western countries now recognise the GNA and the associated Presidency Council as Libya’s legitimate government, countries like the UAE do not. The latter’s foreign ministry has stated that they will recognise the GNA once it has been approved by the House.

The NOC in Tripoli now has international backing and especially after its leadership agreed to only work with the Presidency Council and the GNA. Last week NOC head Mustafa Sanalla re-iterated this support at the 17th International Oil Summit in Paris.

In the past, the international community has recognised the Bayda government but Western officials have always insisted that Libya’s financial institutions, including the NOC, remain neutral in the political crisis, and have largely been wary of attempts in the east to set up parallel institutions.

This latest attempt by the eastern NOC to sell oil illegally appears to be yet another bid by the eastern officials to increase their leverage over Tripoli, and, if it had been successful, it would have critically endangered the December 2015 political agreement.

Instead the incident reiterates the urgent need to resolve the ongoing political chaos for the sake of the oil sector, which is so vital to Libya’s reconstruction.

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