* Says battling to protect oil sector from interference
* Working to resolve Wintershall dispute, fix infrastructure
* National production has more than tripled since last year
By Aidan Lewis
TRIPOLI, May 17 The head of Libya's National Oil
Corporation (NOC) is determined to fend off an attempt by the
U.N.-backed government to appropriate energy sector powers, and
says settling a related dispute with Germany's Wintershall is a
In an interview with Reuters, NOC Chairman Mustafa Sanalla
also said output from NOC subsidiary Waha Oil Co could rise by
some 80,000 barrels per day (bpd) in coming weeks and that staff
had returned to parts of the Sirte basin for the first time in
more than two years.
National output dipped this week due a power outage
affecting Messla and Sarir oil fields and on Wednesday stood at
683,000 bpd, Sanalla said, but was expected to return to its
"normal" level of 800,000-820,000 bpd over the next two days.
That is more than three times higher than Libya's output in
mid-2016, though just half of what the OPEC member was producing
before its 2011 uprising. The NOC has had to navigate local
blockades, conflict, and a political split between eastern and
western-based factions as it tries to revive its operations.
It pledged to work with the U.N.-backed Government of
National Accord (GNA) when it arrived in Tripoli last year. But
relations soured over NOC budget payment disputes, and after the
GNA's leadership issued a decree this year granting itself
powers over energy contracts.
Sanalla says this was done in order to help Wintershall
, which he says has been refusing to honour an
agreement to move from an expired concession contract to a
production sharing deal, and is liable for up to $1 billion in
lost NOC revenue.
The German company says its concessions are still valid,
that it is in contact with the NOC, and that "there is no claim
over money allegedly owed by Wintershall." The GNA has not
"I think this Wintershall issue is a disaster from a
political point of view and this shows everybody that the
politicians try to control NOC, try to interfere in the oil
sector," Sanalla said. "I am concerned that they are not going
to stop their attempts to control NOC for their agenda."
He said the GNA had tried to implement its decree but had
not been able to, and that he was happy a court in the east
Libyan city of Benghazi on Monday upheld an NOC appeal against
WINTERSHALL DISPUTE PRIORITY
Sanalla said he would "never permit" the GNA's move, and
would fight to defend the NOC from political conflict until
there was a free election in Libya. "We are a state oil company
and we cannot compromise on our rights."
The NOC says the Wintershall dispute is locking in 150
standard cubic feet of gas production and 160,000 bpd of oil,
including 70,000 from Rimel and Abu Attifel fields operated by
NOC and Italy's ENI. If it is resolved, that - along
with additional production from Waha - would bring total output
well over 1 million bpd, Sanalla said.
"Our plan is that hopefully we can pass 1 million (bpd) …
five weeks, six weeks from now," he said.
"Solving this dispute with Wintershall is a top priority for
Sanalla said he had appointed a team to study options for
bringing output from Al-Rimal and Abu Attifel online if the
Wintershall dispute continues. "We have to think out of the box,
but there are many technical obstacles."
He said NOC teams had returned to the western Sirte basin
for the first time since March 2015, where infrastructure was
damaged by attacks by Islamic State militants and theft.
"Now we are happy with the security, our staff are happy,
they're there, and also they're keen, they're eager to work,"
Sanalla said, adding he hoped production at Waha Oil Co's Gialo
field could restart within a month.
"We work very hard to repair the infrastructure, especially
the pipeline network which was in bad shape due to a long
(Additional reporting by Vera Eckert in Frankfurt; Editing by