Glen­core loses mar­ket­ing rights

Business Day - - FRONT PAGE - Ju­lia Payne and Ah­mad Ghad­dar Lon­don

Trad­ing and min­ing gi­ant Glen­core has lost its ex­clu­sive mar­ket­ing rights for two of Libya’s main crude oil ex­port grades after hold­ing them since late 2015, trad­ing sources with di­rect knowl­edge said.

Trad­ing and min­ing gi­ant Glen­core has lost its ex­clu­sive mar­ket­ing rights for two of Libya’s main crude oil ex­port grades after hold­ing them since late 2015, trad­ing sources with di­rect knowl­edge said.

The Switzer­land-based firm had se­cured the rights to the Sarir and Messla grades when it was one of the few for­eign com­pa­nies will­ing to deal with the North African coun­try dur­ing un­rest that has wracked the coun­try since 2011.

Glen­core, which had ex­clu­sive rights on the two grades un­til the end of 2018, and Libya’s Na­tional Oil Corp (NOC) de­clined to com­ment.

In a sign of re­newed in­ter­na­tional con­fi­dence in Libya’s oil in­dus­try, BP and Royal Dutch Shell re­turned to lift­ing di­rectly from the coun­try in 2018, ini­tially tak­ing other grades.

“Glen­core lost ex­clu­siv­ity on Messla and Sarir,” one of the sources told Reuters, ask­ing not to be named. “Com­pa­nies like BP and Shell had their first Messla and Sarir al­lo­ca­tion.”

The two grades ac­count for nearly a fifth of Libyan out­put that now stands at 953,000 bar­rels per day (bpd), still well be­low the pre-con­flict level of 1.6-mil­lion bpd.

For a pe­riod when oil pro­duc­tion fell even more sharply, those grades that are ex­ported from the eastern Libyan port of Marsa el Hariga gen­er­ated the bulk of state rev­enues.

Libya’s 220,000 bpd Ras Lanuf re­fin­ery, which is now idled, ran on the two grades. The re­main­der of Libya’s crude streams have not been al­lo­cated ex­clu­sively to one com­pany for such an ex­tended pe­riod.

So far, Unipec was also al­lo­cated three car­goes from Marsa el Hariga in Jan­uary, one source said, though the pro­por­tion taken of each grade by the trad­ing arm of China’s Sinopec was not im­me­di­ately clear. BP is due to take 1-mil­lion bar­rels on the Cres­cent Moon tanker in midJan­uary from the same port, ac­cord­ing to a ship­ping source and Refini­tiv Eikon ship track­ing. BP did not im­me­di­ately re­spond to a re­quest for com­ment on the mat­ter.

Shell is also due to take at least one cargo from Marsa el Hariga, three sources said.

Shell also did not im­me­di­ately re­spond to a re­quest for com­ment on the claims.

Se­cu­rity chal­lenges still threaten Libya’s oil in­fra­struc­ture. Its largest oil­field, El Sharara, has been shut since De­cem­ber over a dis­pute with tribes­men, armed pro­test­ers and state guards de­mand­ing salar­ies and de­vel­op­ment.

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