While all eyes of international society are bent on 75th session of the UN General Assembly, there are other events of quite a comparable importance happening in Libya. Libya's National Oil Corporation announced a partial resumption of oil production and export. The decision of the oil workers came at the background of the agreements between the Commander-in-Chief of the Libyan National Army (LNA) Khalifa Haftar and the Deputy Prime Minister of the Government of National Accord (GNA) of Libya, Ahmed Maiteeq.
“With God's blessing, work has begun on the Sirte Oil and Gas Production fields”, Libyan National Oil Corporation (NOC) announced Sunday evening. The NOC representatives also informed that it would resume oil production operations at three fields located between Sirte and Benghazi - Zalten, Ar-Rakuba and El-Lehib. Export through the port of Marsa-el-Brega is also resuming. On Thursday, September 24th, according to media reports, the Arabian Gulf Oil Co. is expected to resume operations, which exports products from the Marsa-al-Hariga terminal in the port of Tobruk in eastern Libya which is controlled by the LNA. The first tanker is to arrive there on the same day.
The NOC`s announcement came shortly after the LNA commander, Field Marshal Khalifa Haftar`s decision to resume oil production and export, which he has blocked since January, but only under conditions of “guaranteeing a fair distribution of income and not using them for financing terrorism”.
The cancellation of the force majeure regime put pressure on oil quotes - November futures for Brent fell by 4.2%, to $41.3 per barrel. Before the restrictive measures, Libya produced 1.1 million barrels per day, and after the introduction of the force majeure regime - only about 0.1 million. Thus, theoretically, about 1 million barrels of oil per day could return to the market, which is comparable to 1.1 % of world demand.
This is a very significant volume and could disrupt the efforts of OPEC + countries to stabilize the market, given that demand is expected to decline significantly in the fourth quarter due to new restrictions related to the coronavirus. Libya, although an OPEC member, is exempt from production cut obligations, as well as Venezuela.
Nevertheless, the decision to resume oil production is decisive in an attempt to stabilize the country's budget of Libya, which is mainly replenished by oil. Nine months of blocking export and production have affected the financial position of the country.
The bulk of the Libya`s oil facilities and ports have not been operational since January this year. It should be emphasized that it is the eastern part that has the main reserves of energy resources and the corresponding infrastructure. At the same time, the region had no influence on the distribution of oil revenues. Therefore, the decision taken by the Libyans was supported primarily by the representatives of the Libyan National Army, who control this territory.
The reasons for Khalifa Haftar's decision were clarified literally half an hour after his speech by the LNA spokesman Ahmed al-Mismari. According to him, the resumption of oil fields for a month is the result of an inter-Libyan dialogue with the vice-premier of the Tripoli-based GNA Ahmed Maiteeq. The parties have developed an agreement on the fair distribution of oil revenues and the formation of a technical committee: its members will oversee the implementation of this decision and deal with disputes.
Thus, the agreement between Haftar and Maiteeq opens an opportunity to restore full export of Libyan oil. It will give the country the money it needs, which is important against the backdrop of mass protests that have shaken parts of the country in recent weeks. The protests occurred on the territories controlled by the government in Tripoli as well as the government in Tobruk. The NOC is obliged to distribute oil revenues throughout Libya.
In addition, the Haftar-Maiteeq agreement could be a factor in building confidence between parties to the conflict in Libya. Thus, it will serve the cause of peace and restoration of normal life throughout the country.
However, news about the dialogue between Khalifa Haftar and Ahmed Maiteeq had sparked a scandal in Tripoli. On Sunday night, the Supreme Council of State, created as an advisory body to the GNA, rejected the agreement between the two politicians, calling it “violating current laws.” Some deputies of Libyan parliament sitting in Tripoli had spoken in a similar way.
Experts believe that this reaction may be due to fear of the rise of Ahmed Maiteeq. By concluding an agreement with Haftar, he applied for political leadership. Given that a few days earlier the head of the GNA, Fayez Sarraj, had announced his decision to resign, there was a tense political struggle in Tripoli to take his place. Meanwhile, the head of the Supreme Council of State Khaled al-Mishri is considered one of the main contenders.
However, Khaled al-Mishri and many other members of the GNA have been compromised by ties to the radical organization Muslim Brotherhood. Ahmed Maiteeq as a more moderate politician is a more acceptable figure in the eyes of the international community. By concluding an agreement with Haftar, he has demonstrated his effectiveness.
It is worth to mention that about a month ago, the head of the GNA Fayez Sarraj and the House of Representatives` speaker based in the east of Libya, Aguila Saleh, named the transfer of proceeds from the sale of raw materials to the NOC account in the Libyan foreign bank among the ceasefire conditions.
This money was not to be cashed until a comprehensive political agreement was reached, in line with the results of the Berlin Conference in January. Almost simultaneously with this, political dialogue was resumed between the parties to the conflict. The negotiations took place in Morocco and Montreux, Switzerland. However, Khalifa Haftar, on whom the implementation of the ceasefire agreements and the unblocking of oil exports largely depended, did not show his attitude towards the statements of Fayez Sarraj and Aguila Saleh until September 18.
On Friday, September 18, making his own decision, the Field Marshal said that all the initiatives which were discussed before in order to resolve the Libyan crisis “ended in failure.”
Jalal Harshaoui, a researcher on Libyan issues at the Dutch Klingendaal Institute of International Relations, explained why the NOC hastened to resume oil production, despite the critics of the Haftar-Maiteeq agreement.
“First of all, the NOC has not been subordinate to any Libyan government for many years. This company is used to acting almost independently, when it is not physically impeded by armed groups. Secondly, under the current CEO Mustafa Sanallah, the NOC`s policy has always been to produce and export as much as possible, regardless of political or financial differences between the Libyan conflict parties”, the expert emphasized.
One should also not write off the interest of some European states in the resumption of the functioning oil industry in Libya. In December 2019, Libyan authorities approved the acquisition of a 16.33% stake in Marathon Oil by the French company Total under the Waha Oil concession. It is assumed that Total will invest $ 650 million in this project, increasing production by 180 thousand barrels per day. The Italian ENI is also interested in the resumption of oil production
EU approves €2.9 billion in state aid for battery project attracting €9 billion
The Commission has approved, state aid of up to €2.9 billion in funding for an ‘Important Project of Common European Interest’ (IPCEI) to support research and innovation in the battery value chain. The twelve EU countries involved will provide public funding expected to unlock an additional €9 billion in private investments.
The project, called “European Battery Innovation” was jointly prepared and notified by Austria, Belgium, Croatia, Finland, France, Germany, Greece, Italy, Poland, Slovakia, Spain and Sweden.
€2,9bn public money crowding in €9bn for massive innovation in battery value chain - make it more sustainable. Risks can be too big for one MS/one company to take alone. Good that European governments come together to support! Benefits for the many when new knowledge is shared.
— Margrethe Vestager (@vestager) January 26, 2021
Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “For those massive innovation challenges for the European economy, the risks can be too big for just one member state or one company to take alone. Today's project is an example of how competition policy works hand in hand with innovation and competitiveness. With significant support also comes responsibility: the public has to benefit from its investment, which is why companies receiving aid have to generate positive spillover effects across the EU.”
When Vestager was asked if companies from outside the EU, such as Tesla, could benefit from this funding she said that this was possible and showed that the EU was committed to open strategic autonomy and welcomes non-EU firms when they have the right projects.
The Vice-President for Foresight, Maroš Šefčovič, said: “The Commission has given its green light to a second important project of the common European interest in the field of batteries. Technology is vital for our transition to climate neutrality. The figures show what an enormous undertaking this is. It involves twelve member states from North, South, East and West, injecting up to €2.9 billion euros in state aid in support of 46 projects designed by 42 companies, which in turn will generate three times as much private investment. "
"You miss 💯% of the shots you don't take." @WayneGretzky, turning 60 today, famously said.
The success of EU #battery sector🔋 serves as a tangible testimony to that. It's defying the negative trends in our economies & we're on track towards attaining open strategic autonomy. pic.twitter.com/QBQVnTBVIa
— Maroš Šefčovič🇪🇺 (@MarosSefcovic) January 26, 2021
The project will cover the entire battery value chain: extraction of raw materials, design and manufacturing of battery cells, recycling and disposal. It is expected to contribute to the development of a whole set of new technological breakthroughs, including different cell chemistries and novel production processes, and other innovations in the battery value chain, in addition to what will be achieved thanks to the first battery IPCEI.
EU urges AstraZeneca to speed up vaccine deliveries amid 'supply shock'
In a sign of the EU’s frustration - after Pfizer also announced supply delays earlier in January - a senior EU official told Reuters the bloc would in the coming days require pharmaceutical companies to register COVID-19 vaccine exports.
AstraZeneca, which developed its shot with Oxford University, told the EU on Friday it could not meet agreed supply targets up to the end of March, with an EU official involved in the talks telling Reuters that meant a 60% cut to 31 million doses.
“We expect the company to find solutions and to exploit all possible flexibilities to deliver swiftly,” an EU Commission spokesman said, adding the head of the EU executive Ursula von der Leyen had a call earlier on Monday with AstraZeneca’s chief Pascal Soriot to remind him of the firm’s commitments.
A spokesman for AstraZeneca said Soriot told von der Leyen the company was doing everything it could to bring its vaccine to millions of Europeans as soon as possible.
News emerged on Monday that the company faces wider supply problems.
Australia’s Health Minister Greg Hunt told reporters AstraZeneca had advised the country it had experienced “a significant supply shock”, which would cut supplies in March below what was agreed. He did not provide figures.
Thailand’s Health Minister Anutin Charnvirakul said AstraZeneca would be supplying 150,000 doses instead of the 200,000 planned, and far less than the 1 million shots the country had initially requested.
AstraZeneca declined to comment on global supply issues.
The senior EU official said the bloc had a contractual right to check the company’s books to assess production and deliveries, a move that could imply the EU fears doses being diverted from Europe to other buyers outside the bloc.
AstraZeneca has received an upfront payment of 336 million euros ($409 million) from the EU, another official told Reuters when the 27-nation bloc sealed a supply deal with the company in August for at least 300 million doses - the first signed by the EU to secure COVID-19 shots..
Under advance purchase deals sealed during the pandemic, the EU makes down-payments to companies to secure doses, with the money expected to be mostly used to expand production capacity.
“Initial volumes will be lower than originally anticipated due to reduced yields at a manufacturing site within our European supply chain,” AstraZeneca said on Friday.
The site is a viral vectors factory in Belgium run by the drugmaker’s partner Novasep.
Viral vectors are produced in genetically modified living cells that have to be nurtured in bioreactors. The complex procedure requires fine-tuning of various inputs and variables to arrive at consistently high yields.
“The flimsy justification that there are difficulties in the EU supply chain but not elsewhere does not hold water, as it is of course no problem to get the vaccine from the UK to the continent,” said EU lawmaker Peter Liese, who is from the same party as German Chancellor Angela Merkel.
The EU called a meeting with AstraZeneca after Friday’s (22 January) announcement to seek further clarification. The meeting started at 1230 CET on Monday.
The EU official involved in the talks with AstraZeneca said expectations were not high for the meeting, in which the company will be asked to better explain the delays.
Earlier in January, Pfizer, which is currently the largest supplier of COVID-19 vaccines to the EU, announced delays of nearly a month to its shipments, but hours later revised this to say the delays would last only a week.
EU contracts with vaccine makers are confidential, but the EU official involved in the talks did not rule out penalties for AstraZeneca, given the large revision to its commitments. However, the source did not elaborate on what could trigger the penalties. “We are not there yet,” the official added.
“AstraZeneca has been contractually obligated to produce since as early as October and they are apparently delivering to other parts of the world, including the UK without delay,” Liese said.
AstraZeneca’s vaccine is expected to be approved for use in the EU on Jan. 29, with first deliveries expected from 15 February.
($1 = €0.8214)
Chemicals: EU protects wildlife from negative effects of lead in the environment
On 25 January, the Commission took firm steps to ensure that wildlife is protected from the negative effects of lead in the environment, by restricting its use in gunshot in or around wetlands. Adopted under the framework of the EU's chemicals regulation, the measure will help to protect the environment by significantly reducing lead pollution while preventing the avoidable death by lead poisoning of around 1 million waterbirds every year. Lead is a highly toxic substance, which released to the environment contaminates both the soil and water.
Every year, 4,000 to 5,000 tonnes of lead are released into wetlands from lead gunshot. There are affordable alternatives, for example steel gunshots, which currently cost about the same as lead gunshots. The measure adopted today will harmonise and enhance the effectiveness of national legislation limiting the use of lead gunshot in wetlands already in place in 24 member states.
It will start applying in two years' time. The restriction supports the goals of the Chemical Strategy for Sustainability and the Green Deal. It also supports the objectives of the Birds Directive, and is a first concrete deliverable under the new EU 2030 Biodiversity Strategy. More info here.
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