Banking expert Noaman Al-Bouri wrote an article in which he said:<\/p>\n\n\n\n
The National Oil Corporation has announced an ambitious goal of increasing Libya\u2019s oil production to two million barrels per day by 2031. This goal is technically achievable, but it requires investments estimated at around $36 billion over the coming years.<\/p>\n\n\n\n
The discussion immediately turns to the question of financing: Where will this money come from?<\/p>\n\n\n\n
In my view, this is the wrong question. The real problem is not the availability of funds, but rather the structure of the oil sector itself.<\/p>\n\n\n\n
Today, the National Oil Corporation and its companies rely almost entirely on government financing and do not have the legal personality and financial independence that would enable them to borrow, issue debt instruments, or enter into long-term financing arrangements. In other words, the sector\u2019s companies, in their current form, are not bankable, regardless of the quality of their assets or the size of their reserves.<\/p>\n\n\n\n
Therefore, achieving the target of two million barrels per day requires institutional reform before it requires financing.<\/p>\n\n\n\n
The solution lies in restructuring the sector in line with international best practices, transforming the National Oil Corporation into an independent holding company, similar to Sonatrach in Algeria, Saudi Aramco in Saudi Arabia, and ADNOC in the United Arab Emirates.<\/p>\n\n\n\n
The holding company would manage investments and financial resources independently and operate according to clear commercial principles, while remaining committed to paying royalties and taxes owed to the state, rather than relying on annual allocations from the general budget.<\/p>\n\n\n\n
As for the producing companies, they should become fully independent companies with separate financial accounts, audited financial statements, corporate governance, and boards of directors responsible for their performance. They would also be required to pay taxes on their profits and independently manage their cash flows, making them eligible to obtain financing from local and international banks and financial institutions.<\/p>\n\n\n\n
Once these companies become bankable, the entire landscape will change. Instead of waiting for government financing, they will be able to finance their expansion projects through loans, bonds, structured financing arrangements, and investment partnerships, as is the case with major national oil companies around the world.<\/p>\n\n\n\n
Restructuring the oil sector will not only help achieve production of two million barrels per day. It will also establish a more efficient, transparent, and sustainable sector, reduce the burden on public finances, and open the door to billions of dollars in investment without imposing additional burdens on the public treasury.<\/p>\n\n\n\n
Libya does not suffer from a shortage of oil wealth. Rather, it needs a modern institutional model that enables this wealth to finance its own growth. When we fix the structure, financing will become a natural outcome rather than an obstacle to development.<\/p>\n\n\n\n
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Banking expert Noaman Al-Bouri wrote an article in which he said: The National Oil Corporation has announced an ambitious goal of increasing Libya\u2019s oil production to two million barrels per day by 2031. This goal is technically achievable, but it requires investments estimated at around $36 billion over the coming years. The discussion immediately turns […]<\/p>\n","protected":false},"author":13,"featured_media":257829,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"iawp_total_views":0,"footnotes":""},"categories":[683],"tags":[613],"class_list":["post-257828","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economic-articles","tag-libya"],"acf":[],"yoast_head":"\n