(Updates with Libyan investments in ninth paragraph.)
June 15 (Bloomberg) -- Libya’s rebel government is seeking $3.5 billion to cover its budget for six months as sales of crude stopped after oil fields were destroyed, said Mahmoud Badi, the president of foreign investments and sovereign assets.
“Oil sales have been stopped because there has been an aggression on the oil fields and the producing fields were destroyed,” Badi said in an interview in Abu Dhabi yesterday. “We were only able to sell one cargo for $90 million to $100 million and after that we were not able to.”
Libya was producing as much as 1.4 million barrels a day of crude before opposition to Muammar Qaddafi’s four-decade rule in mid-February led to an armed rebellion that halted oil exports. In April, a tanker loaded about 1 million barrels from rebel- controlled territory that was marketed by Qatar’s national oil company.
Rebel officials are visiting friendly Arab and European nations for credit lines and loans. The National Transitional Council received pledges for a total of $1.2 billion from countries including France, Italy and Qatar, said Ahmed Jehani, the official in charge of reconstruction at the rebel council.
The cost of importing fuel for rebel-held cities is $300 million a month, according to Badi. This has been covered by countries that used to be customers of Libyan oil and companies that produce or sell crude for the nation such as Eni SpA, Total SA and Vitol Group, he said.
The rebels need armored cars, helicopters and weapons in order to secure oilfields so they can resume crude production and processing operations, Badi said. Four out of five of the nation’s refineries are shut and the Qaddafi-controlled Zawiyah facility is operating only partially, he said.
The 20,000 barrel-a-day Tobruk refinery and 10,000 barrel- a-day plant at Sarir “might start within weeks, or one to two months if we provide security,” Badi said. Peace would also enable crude output of about 100,000 barrels a day, he said.
The United Arab Emirates, of which Abu Dhabi is the capital, hosted the 22-nation Libya Contact Group last week. Italy pledged at the conference to provide the Libyan rebel council with 300 million to 400 million euros, with 150 million euros in fuel and the rest in cash in the coming weeks.
Libyan investments outside the country of as much as $200 billion are not all frozen because some are under personal names rather than a domestic institution or bank, Badi said. Such investments are “for sure in the African nations” and may also be in Europe, the U.S., Japan and the Middle East, Badi said.
Some oilfields may take as long as a year to return to production because of the damage done by the fighting, he said.
Total has “no visibility” on when output from Libya will resume, head of strategy Jean-Jacques Mosconi said today. Production of about 55,000 barrels a day was halted in March. Eni could lose about 200,000 barrels of oil equivalent a day in Libya this year if the unrest continues, Chief Executive Officer Paolo Scaroni said last month. The company’s Libya production reached 280,000 barrels of oil equivalent a day in 2010.
--With assistance from Robert Tuttle in Doha, Ola Galal in Cairo and Alaric Nightingale in London. Editors: John Buckley, Rob Verdonck
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