Libya: AGOCO hopes to end power dilemmas impeding oil production

January 2, 2018

The Libyan Arabian Gulf Oil Company (AGOCO) said it was hoping to resolve electricity problems by the end of March 2018.

“Power complexities and outages are keeping production well below potential,” AGOCO’s Chairman said on Monday, Rueters reported.

In recent weeks, AGOCO’s production has been fluctuating between around 150,000 and 230,000 barrels per day (bpd), according to an oil source who asked not to be named, added Reuters.

“On Monday, production stood at 140,000 bpd, well below the more than 320,000 bpd AGOCO was producing in October.” According to the source.

AGOCO, which is a subsidiary of the National Oil Corporation (NOC), has suffered from power supply problems and funding shortfalls for its operating budget plus a lack of investment.

AGOCO Chairman Mohamed Shatwan said, according to Reuters, that many wells were shut because of ageing infrastructure and a lack of power in a number of fields, including the giant Sarir oilfield.

He explained to Reuters that Sarir oilfield covers an area of more than 500 sq km so it needs converter stations and transformers to ensure power supply, indicating that two new fixed turbines were brought to Sarir in 2014 to replace turbines from the 1960s but are still awaiting assembly, saying that it is a process that will take up to a year and a half.

He declined to specify AGOCO’s current or future output levels, Reuters reported Monday.

“We bought three other mobile turbines of 5 megawatts each, so 15 MW, in order to resolve the power problem until the others are installed.” He told Reuters.

“Another major problem for AGOCO is its gas compressors in Nafoura field, which also date from the 1960s. Some of them are no longer manufactured and spare parts are not available,” Shatwan explained in en Exclusive Interview with Reuters.

He explained that ageing equipment and lack of spare parts of course contributes to stoppages at existing power plants in the fields, and the power plant stoppages lower production.

“But from the plan we have been putting in place for years, we expect to overcome our electricity problems in the first quarter of 2018, by the end of March.” The AGOCO’s Chairman explained to Reuters.