Libya sets sights on higher gas output in energy policy shift

Libya plans to raise its gas production to 4 billion cubic feet (bcf) a day in the next three to five years, from the current levels of 2.5 bcf per day, as it focuses on expanding its natural gas resources, according to its oil and gas minister.

Speaking at a panel at the Istanbul Energy Forum in Turkey, Khalifa Abdulsadek said that the country’s long-standing energy strategy of focusing on crude oil was shifting to include natural gas as well.

"We used to focus more on oil, now we are focusing on oil and gas,” he said. “The strategy that we are really focusing on at the moment, is how we can create more gas resources to support the security of supply to our neighbouring countries and Europe.”

Libya has proven gas reserves of 1,505 billion cubic metres, according to Opec, and the resource-rich country is attempting to boost production for exports. The minister admitted that there are “challenges” to be overcome, following a decade of political and security turmoil in Libya following the 2011 Nato-backed uprising against Muammar Qaddafi. In 2014 the country split between warring eastern and western factions. Major fighting ended with a ceasefire in 2020.

The Greenstream pipeline that transports natural gas exports from Libya to Italy is operating at just 25 per cent capacity at present, Mr Abdulsadeq said. “If there is something that keeps me awake at night, it is how I can fill in this pipeline to a place like Europe where gas molecules are needed right now. As such, our strategy is very focused on increasing gas output.”

Chairing the panel of ministers from Libya, Georgia, Azerbaijan and eastern European countries, Turkey’s Energy Minister Alparslan Bayraktar said his country was willing to help the North African nation explore offshore gas resources and “utilise the pipeline” to Europe. Libya, which has the largest crude reserves in Africa, is also aiming to boost oil output to two million barrels per day by 2028, up from around 1.35 million bpd at present.

The country resumed oil production in October after the National Oil Corporation (NOC) lifted force majeure at all oilfields and terminals following a period of political tensions between the two governments ruling different parts of the country.

In August, Libya’s eastern government, led by military commander Field Marshal Khalifa Haftar, announced the shutdown of all oilfields, suspending production and exports. This followed a decision by the rival administration in Tripoli to remove Central Bank governor Sadiq Al Kabir, whose role was to distribute the country's oil revenue between the two governments.

With an increase in oil production there will be a corresponding increase in associated gas produced as a by-product of crude extraction. This gas is often flared by oil-producing nations, in a wasteful and environmentally ruinous practice known as flaring.

Mr Abdulsadeq said that the country aims to “get to near zero” gas flaring by 2030, and reuse the gas, which can be captured using various technologies, “and monetise this on the national market”. Using such gas for domestic supply would free up other gas for exports, he said. Gas flaring in Libya increased by 1.4 bcm or 25 per cent in 2023, while oil production increased by 16 per cent, according to the World Bank’s gas flaring tracker report.

Libya is also attempting to increase its use of renewable energies by trying to attract investment from foreign companies. “We are trying to encourage international companies to partner with us in creating and developing renewables,” Mr Abdulsadeq said.