Turmoil costs Libya $6 billion, hits power supply, officials say

Protesters in Libya seized most oil ports and fields since August, demanding more rights or better pay

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Protests at oil ports have cost Libya more than $6 billion and started hitting power supplies in the North African country, where political chaos is also affecting funding for wheat imports, officials said on Thursday.

Tribes, armed militias and members of the Berber minority have seized most oil ports and fields since August to demand more rights or better pay, adding to chaos in Libya two years after the fall of Muammar Gaddafi.

The government of Prime Minister Ali Zeidan has been unable to rein in armed groups who helped topple Gaddafi but kept their weapons and now control much of the vast OPEC producer.

Libya has lost almost 8bn Libyan dinars ($6.43bn) in oil sales due to the port and oilfield protests, Economy Minister Mustafa Abu Fanas told reporters.

Output is down to a fraction of capacity of 1.25 million barrels a day, industry sources say. Officials have not provided any update this week.

“If these blockages continue, it will have a big negative impact,” Abu Fanas said. He added that the government would be able to pay salaries by drawing on other sources. Libya has built up foreign exchange reserves from times of high oil prices.

The state power company said a protest by members of the Amazigh, or Berber, minority at the Mellitah oil and gas complex in western Libya had cut gas supplies, hitting its electricity network, state news agency Lana said.

“A halt in gas supplies used for power generation from the Mellitah oil and gas complex is reducing the capacity of the power network in the western region,” the company said.

Two weeks ago, the Amazigh seized the complex, operated by Italy’s ENI and the state-owned National Oil Corp, and halted gas and oil exports in support of demands for more political rights.

A senior Mellitah official declined to comment. National Oil Corp this week cut oil output at the El Feel oilfield feeding Mellitah to 18,000 barrels a day, down from its 130,000 bpd capacity, as port tanks were running full.

The Amazigh are demanding that their language be guaranteed by the constitution, adding to the challenges faced by Zeidan, who is grappling with similar protests in the east.

In Benghazi, the main city in eastern Libya, unknown attackers killed two army officers on Thursday, security sources said.

In another sign of turmoil, Abu Fanas said Libya needed to pay debts of wheat importers that have been piling up for more than a year to ensure future flour supplies.

He said the government had asked parliament several times to approve payments for wheat purchases to private companies backed by the state but no debate had been scheduled yet because it had been busy with more pressing issues.

“I don’t think we will have a [supply] crisis,” Abu Fanas said. “If the General National Congress [parliament] takes a decision next week, we won’t have any problems with flour. We have stocks, there is ongoing supply and we have contracts for the year ... and most mills have large stocks of wheat.”

He said he was not worried about flour shortages in the next couple of months.

Zeidan has accused Islamist opponents in parliament of blocking the budget to bring down the government.

There was no indication that the oil protests were winding down, though some Libyan news websites said a group of Mellitah workers had asked the Amazigh to end their blockade to ensure gas supplies.

Many Libyans are fed up with the militias, which often protest not for political demands but simply for higher pay.

“Some shut off water supply, others seize a port, an oil field, a school or road just for personal gains,” said student Abu Bakr Masoud, filling his car at a petrol station.

Omar Kashlaf, a driver, added: “It seems that armed groups can just do what they want.”

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