Petrofac has signed an engineering, procurement, construction and commissioning contract worth more than $100 million in Libya.
The service company signed the deal with Zallaf Libya Oil & Gas Exploration and Production, on its Erawin field development phase 1 early production facilities.
The work in southwest Libya covers surface equipment, including well pads and flowlines on the Erawin field. Petrofac will provide a 100 km pipeline to carry oil to the El Sharara field. It also includes a control room, substation and telecom system.
Petrofac is working on front-end engineering and design (FEED) and conceptualisation studies in Libya. These are up- and downstream, it said, for a number of clients. This provides the opportunity for further EPC contract work.
Libya’s state-owned National Oil Corp. (NOC) owns 100% of Zallaf.
NOC confirmed the Petrofac contract, with chairman Mustafa Sanalla welcoming the deal as demonstration of Libya’s promise. The statement said that, despite the budgetary challenges for NOC, the company was determined to welcome global companies to the country.
Should Petrofac execute the Erawin contract successfully, the company will be in a strong position for further work in Libya, Sanalla said. Discussions on the field have been under way for two years.
Petrofac chief operating officer of engineering and construction Elie Lahoud said Libya was working to become a major oil and gas producer again. The company is “looking forward to helping [NOC] achieve its goals, develop key infrastructure safely and securely, and increase production”.
The work for Zallaf “builds on our strength of engineering and construction capability and track record of effective delivery”, Lahoud said.
NOC reported discussions in October 2019 on the sidelines of a conference with Petrofac. The Libyan company noted talks on Erawin, setting out the intention of starting production in late 2020.
Zallaf noted talks on Erawin’s development with Petrofac in June this year. The Libyan company has a number of projects on the go, including plans for the development of the Chadar field and the drilling of an exploration well.
Updated at 3:50 pm with comment from NOC.