Continental Focus, International Reach

NOC Cuts Off Supplies to LifeCo

Tuesday, January 29, 2019

Libya’s sate-run oil and gas firm, NOC, confirmed the suspension of natural gas supply to the Libyan Norwegian Fertilizer Company (LifeCo) pending settlement of unpaid debts. LifeCo was formed in 2009 as a joint venture, with Yara holding 50% of the shares and both NOC and the Libyan Investment Authority each taking a 25% stake.

In a statement on its website, NOC said that an attempt to resolve the issue had been made by its management through various consultations aimed at rooting out corruption and ensuring operational continuity at LifeCo plants.

“NOC has held a series of meetings with Yara’s management and LifeCo’s board of directors to discuss arrangements that ensure LifeCo’s partner assumes its financial responsibility towards collective debts: 210 million Libyan dinars and 31 million euros owed to Sirte Oil Co, and over $90 million owed to NOC,” the NOC statement said.

It added that talks to negotiate a solution have not been successful as a result of Yara’s refusal to assume repayment responsibility, expecting NOC to solely finance LifeCo’s operations, while continuing to market its products internationally – resulting in an unequal relationship; profitable to Yara, but loss-making for NOC.

“NOC assures LifeCo employees that job protection remains an absolute priority for the corporation, while it retains its right to hold financial defaulters, from any party accountable,” the statement went on to say.

NOC said that it is currently exploring various solutions to this issue to ensure the continuity of the company and the resumption of business as soon as possible – thereby securing the future of staff, and transforming it into a profitable and transparent company serving the national economy.