The Financial Times reported Tuesday that Libya needs up to $40 billion in investment to develop its oil and gas resources as it seeks to regain its position as one of the world’s major crude oil producers.
According to the U.S. Energy Information Administration, Libya has attracted a number of international oil companies in recent years in search of new opportunities.
National Oil Corporation Chairman Masoud Suleiman said progress has stalled due to a lack of capital. He told the Financial Times in an interview: “We have a lot of untapped resources and need significant funding ranging between $30 billion and $40 billion.”
According to the newspaper, Suleiman is targeting an “ambitious but realistic” goal of increasing Libya’s oil and gas production to 2 million barrels per day by 2030, compared with around 1.4 million barrels per day currently.
He noted that more than 60 oil and gas fields have been discovered but remain undeveloped. Foreign companies, including Eni, TotalEnergies, Chevron, and ConocoPhillips, are active in Libya, but investment has slowed due to political instability, concerns over corruption and governance, and a lack of funding at the National Oil Corporation.
Suleiman said the National Oil Corporation is therefore considering a return to concession agreements, under which investors would bear more of the initial costs.
“We are considering changing the business model between the National Oil Corporation and our international partners. We are suffering from a lack of funding, and this is significantly delaying our development projects,” he said.
The newspaper noted that the National Oil Corporation was considering “whether we should return to concession agreements” or improve the existing production-sharing terms to allow investors to provide more financing.
As an early example of the potential shift, the National Oil Corporation signed an agreement in July covering an area known as Area 47 with Qatar-based UCC Holding, led by the Khayyat brothers, Syrian-Qatari billionaires, without conducting a competitive licensing round.
Suleiman stressed that Libya’s ability to attract capital is also complicated by its political divisions, with most major oil fields and export terminals located in areas controlled by Khalifa Haftar.
“We have a good relationship, and we travel east and west and speak face-to-face with the key actors,” he said.
He added that foreign investors are forced to communicate with the factions controlling the areas where they operate in order to facilitate their operations.
The newspaper reported that the National Oil Corporation’s financing problems have persisted despite higher oil prices during the U.S.-Israeli war against Iran and despite the latest national budget allocating approximately $2 billion to cover its operating costs.
