Al-Shalwi: The Strategic Pillars of the National Oil Corporation: Between the Ambition of Two Million Barrels per Day and the Requirements of Economic Reform

Written by oil and economic expert Abdulmonsef Al-Shalwi

In the oil industry, the value of institutions is not measured solely by their current production levels, but by their ability to build an integrated strategic vision that ensures sustainable production, maximizes economic returns, and protects national assets for future generations. From this perspective, the seven strategic pillars announced by the National Oil Corporation represent a comprehensive roadmap to guide Libya’s oil and gas sector toward a new phase of growth and stability through 2030.

This vision is of exceptional importance when considering that the oil and gas sector remains the backbone of the Libyan economy, providing more than 90% of the state’s public revenues and over 95% of foreign currency earnings. Consequently, any development in this sector directly impacts the national economy and citizens’ living standards.

First: The Two Million Barrels Per Day Target — More Than Just a Number

Increasing production capacity to two million barrels of oil per day and more than four billion cubic feet of gas per day represents a national and economic objective before being merely an oil-sector goal.

If achieved, and assuming an average oil price ranging between $70 and $80 per barrel, Libya would be able to generate billions of dollars in additional annual revenues compared to current production levels.

However, achieving this target depends not only on increasing production from existing fields but also requires:

• Massive capital investments.
• Legislative and institutional stability.
• Infrastructure development.
• Settlement of accumulated financial obligations.
• Attracting international exploration and production companies.

Therefore, the goal of reaching two million barrels per day should be viewed as a national project rather than merely an institutional one.

Second: Reserve Replacement — Ensuring the Sustainability of National Wealth

One of the fundamental principles of the oil industry is that a country that does not discover new reserves gradually consumes its strategic stock.

Although Libya possesses proven reserves exceeding 48 billion barrels of oil and approximately 53 trillion cubic feet of natural gas, maintaining this position requires continuous exploration programs.

The resumption of licensing rounds and exploration activities after years of suspension is among the most important strategic steps to preserve Libya’s global oil standing.

The objective is not only to produce oil today, but also to ensure the availability of oil and gas for future generations.

Third: Infrastructure Development — The Most Sensitive Link

Over past decades, large parts of Libya’s oil infrastructure have been affected by natural wear and tear and the postponement of development and maintenance work.

This infrastructure includes:

• Pipelines.
• Storage tanks.
• Oil export terminals.
• Gas facilities.
• Industrial power networks.
• Control and monitoring systems.

From an economic standpoint, every dollar invested in maintenance and development helps protect several dollars of future revenues that could otherwise be lost due to failures or emergency shutdowns.

Therefore, infrastructure development is not an expenditure item but a direct investment in the sustainability of national revenues.

Fourth: Supply Reliability — The Foundation of Global Trust

Global energy markets do not seek only producers; they seek reliable suppliers.

When Libya succeeds in maintaining stable oil and gas exports, it strengthens its position as a dependable supplier in European and international markets.

Markets are known to grant greater confidence and pricing advantages to countries capable of consistently honoring their export commitments.

Therefore, enhancing supply reliability is no less important than increasing production itself.

Fifth: Increasing Refining Capacity — Moving from Crude Exports to Value Maximization

One of the most commendable strategic pillars is the focus on increasing refining rates and achieving higher levels of self-sufficiency in petroleum products.

Libya possesses significant oil wealth but still spends substantial amounts annually importing certain refined petroleum products.

Every barrel refined domestically provides the state with:

• Greater added value.
• New employment opportunities.
• Reduced import costs.
• Enhanced national energy security.

Accordingly, projects to upgrade the Zawiya and Ras Lanuf refineries, along with future refining projects, represent a fundamentally economic pillar rather than merely industrial projects.

Sixth: Reducing Flaring — From Waste to Investment

The gas flaring reduction program is one of the most important strategic transformations currently taking place in Libya’s oil sector.

Gas that was flared for decades can instead become:

• Fuel for power plants.
• Feedstock for petrochemical industries.
• An additional export source.
• A tool for reducing carbon emissions.

This vision aligns with the National Oil Corporation’s goal of achieving “zero routine gas flaring by 2030,” a target that carries economic, environmental, and investment dimensions simultaneously.

Seventh: Human Resources — The Real Capital

Regardless of the value of reserves and facilities, the decisive factor remains human capital.

Libya’s oil sector possesses a substantial professional legacy and expertise accumulated over more than six decades.

Developing these capabilities and preparing a new generation of engineers, technicians, economists, and project managers represents the true guarantee of the sector’s future success.

Oil can be discovered, and facilities can be built, but national expertise requires many years to develop.

The Real Challenge: Financing

Among the important messages contained in the presentation was the indication that achieving the short-term target of 1.5 million barrels per day depends on two main factors:

• Timely approval and facilitation of operational and capital budgets.
• Addressing and settling the sector’s accumulated obligations and debts.

Here, a fundamental issue emerges that has been discussed repeatedly over recent years: the oil sector is not merely a recipient of government spending but the revenue-generating sector that finances the entire Libyan state.

Therefore, enabling the National Oil Corporation and its subsidiaries to implement their investment programs under clear governance, oversight, and transparency mechanisms should be viewed as an investment in the national economy rather than a burden on public finances.

Conclusion

The seven strategic pillars of the National Oil Corporation do not represent separate objectives but rather an integrated system in which the success of each pillar depends on the success of the others.

Increasing production requires new exploration activities; exploration requires financing; financing requires institutional stability; and stability requires reliable infrastructure, qualified personnel, and sound resource management.

If Libya succeeds in creating the appropriate environment to implement this vision, the oil and gas sector will not only remain a source of revenue but will become the primary engine for rebuilding the national economy, strengthening energy security, and achieving the sustainable development to which Libyans aspire.

The real challenge is not merely reaching two million barrels per day, but transforming every additional barrel of oil and every cubic foot of gas into sustainable economic value that benefits citizens, the state, and future generations.