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UPDATE 2-East Libyan oil export halt order again targets Glencore deal
June 15, 2017 / 10:28 AM / in 5 months

UPDATE 2-East Libyan oil export halt order again targets Glencore deal

* Eastern move puts 190,000 bpd from Hariga at risk

* Oil officials say terminal is operating normally

* Past efforts by east to sell oil have been blocked (Adds background)

By Ayman al-Warfalli

BENGHAZI, Libya, June 15 (Reuters) - A parallel state oil company based in eastern Libya has ordered a halt to exports handled by Glencore from the port of Hariga, putting the trading giant once again at the heart of a long-standing dispute for the control of Libya’s oil.

Glencore has an exclusive deal with the internationally recognised National Oil Corp (NOC) based in Tripoli to export crude from the eastern port, but the rival eastern NOC has been trying to wrest control of those crude sales since late 2014.

The eastern NOC called on the port’s operator to halt Glencore’s loadings because of the trader’s links to Qatar. It said it was acting on letters from Abdullah al-Thinni’s eastern government requiring companies to cut links with Glencore.

Qatar Holding and CEO Ivan Glasenberg are the largest stakeholders in Glencore. Qatar has an 8.49 percent stake.

Glencore and Qatar also jointly own a 19.5 percent stake in Russia’s state-controlled oil firm Rosneft, which in turn has an agreement with NOC to buy crude. Glencore declined to comment.

The NOC in Benghazi, which has repeatedly tried and failed to take control of oil exports from the NOC in Tripoli, published the order targeting Glencore late on Wednesday.

The Benghazi NOC is aligned with a government and parliament also based in the east, both of which issued statements naming Glencore. Their military commander, Kahlifa Haftar, has received backing from Egypt and the United Arab Emirates which, along with Saudi Arabia and Bahrain, cut ties with Qatar last week.

The countries accused Qatar of fomenting regional unrest, supporting Islamist militants and the Muslim Brotherhood, and getting too close to Iran.

Qatar said the move was based on lies.

Officials in eastern Libya have issued a flurry of statements singling out people and entities with alleged links to Qatar or the Muslim Brotherhood.

Previous efforts by east Libyan factions to export oil have been blocked under U.N. Security Council resolutions that recognise the NOC in Tripoli as the sole legitimate seller of Libyan oil. Haftar’s military has allowed exports to flow freely from the east under the Tripoli NOC.

TANKER LOADING

A spokesman from NOC subsidiary Arabian Gulf Oil Company (AGOCO), which operates exports of Messla and Sarir crude from Hariga, said it had not received the instruction from the Benghazi NOC.

Omran al-Zwai said AGOCO, which produces 250,000 barrels per day (bpd), was operating as usual. The majority of the AGOCO’s production is exported by Glencore.

A port official at Hariga said a tanker had loaded 460,000 barrels of crude on Thursday for export to Greece. Daily volumes through the port are about 190,000 barrels, he said.

The NOC in Tripoli warned al-Thinni earlier this week not to use the Qatar dispute “as a pretext for exporting oil illegally”.

NOC Tripoli Chairman Mustafa Sanalla wrote to Thinni that Glencore was a publicly traded company, and not controlled by Qatar. “It supported us during the (2011) revolution, and supplied fuel on open credit when we had queues of cars waiting at petrol stations,” he said in the letter, a copy of which was seen by Reuters.

Glencore secured an extension to the exclusive deal for lifting the two crude grades. The deal began in September 2015 and currently runs until the end of this year.

Over a year ago, eastern authorities blocked a Glencore tanker from leaving the Hariga terminal for three weeks. (Additional reporting by Aidan Lewis in Tunis; writing by Julia Payne and Ahmad Ghaddar; editing by Jason Neely and David Evans)

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