Tuesday, 10 July 2012 14:34
Shell has fallen under the gun in Libya as the country’s state-run oil firm National Oil Corporation (NOC) has accused it of failing to meet its commitments in the country. According to a statement on the NOC website, Shell’s decision to abandon its operations in Libya was not based on an objective assessment.
Shell reported in late-May that it was abandoning two blocks because further work would be uneconomical for the company.
"The National Oil Corporation believes that Shell's negative assessment of the blocks...does not reflect the reality of the blocks, as some other companies made oil and gas discoveries at the same blocks during the 1960-1970 period," the NOC statement said.
"Shell has recently tried to request the annexation of those blocks, which confirms these areas are rich in oil and gas resources."
NOC also accused the company of failing to meet the terms of an agreement signed in 2008 that involved the drilling of six wells at new fields over a five-year period. “The company had not started drilling any well by the time it announced force majeure on March 22, 2011, but had only completed a seismic survey," the statement read.
"Shell has not lifted the force majeure compared to its activities in other countries where conditions are more difficult than Libya."
While the state-run firm acknowledged that Shell had not had much luck on its acreage, it was unhappy with how Shell released the news of its exit; going to the media about its decision to withdraw and not notifying NOC prior.
Another failure NOC is accusing Shell of is the fact that it made no progress in the development of the LNG plant at Marsa Brega. "During the preliminary discussions, the company confirmed it had the technical and financial capacity to achieve good results regarding the two agreements... but the company has not met its commitments for the exploratory activity and modernizing the gas plant."