Libya's biggest oil field set to cut output after kidnappings

CAIRO (Bloomberg) -- Oil output at Libya’s biggest field is set to drop by about half after authorities evacuated staff and shut wells for safety following the armed abduction of several workers at the Sharara deposit, according to the state National Oil Corp.

Production at the field in western Libya will fall by about 160,000 bpd as a result of the precautionary steps, the NOC said in a statement. Unidentified assailants released two of four workers it kidnapped at Sharara early Saturday but still held the other two, the company said, offering no further details about the kidnappers or their possible motives.

The abductions and output losses highlight the hurdles for Libya as it tries to restore reliable crude flows from its largest field after years of political division and internal conflict. Sharara is operated by a joint venture between the NOC and Total SA, Repsol SA, OMV AG and Equinor ASA, known formerly as Statoil ASA.

Sporadic disruptions, from protests to armed attacks, have upset Sharara’s production in recent months. The field was producing more than 300,000 bpd before the latest attack. The port of Zawiya, where Sharara feeds its crude, was set to ship 6.93 MMbbl of crude this month, according to a loading plan obtained by Bloomberg.

Libya, with Africa’s largest crude reserves, only just re-started shipments from its eastern oil ports on July 11, after a political standoff curbed output in that region. The following day, the NOC lifted force majeure restrictions at the western El-Feel field. While those developments marked a positive turnaround for the country’s oil industry, supply disruptions like the one at Sharara complicate efforts by the Organization of Petroleum Exporting Countries, of which Libya is a member, to pump more crude.