March 25 (Bloomberg) -- Rebels seeking self-rule in eastern Libya insisted that the government withdraw a threat to attack oil ports they control before agreeing to talks on a settlement that might restore the nation’s crude exports to full capacity.
The government issued an ultimatum on March 12, threatening to attack the rebels if they didn’t surrender the ports within two weeks. Authorities in the capital Tripoli didn’t specify exactly when the deadline expires.
“We demand that the government cancel decision number 42,” which established the deadline, Ali Al-Hasy, a spokesman for the self-declared Executive Office for Barqa, said today by telephone from eastern Libya.
The ultimatum followed an attempt by the rebels in Barqa, or Libya’s eastern Cyrenaica region, to ship crude from the port of Es Sider, the largest of the North African nation’s nine oil-export terminals. The U.S. Navy foiled the attempt, intercepting the tanker Morning Glory and transferring it to Libyan authorities on March 22 along with 21 crew members and three rebels who were on board.
The eastern rebellion, led by former Petroleum Facilities Guards commander Ibrahim Al-Jedran, took control of Es Sider and three other oil ports in July. Protests over jobs, pay and political rights of minorities including the Amazigh Berbers in the west of the country have further curbed its oil output.
The Morning Glory was carrying 350,000 barrels of crude, Al-Hasy said. The vessel is owned by a company set up in the Barqa region to sell oil independently of the central government, he said.
“We request that the tanker be handed over to Barqa with its oil and its crew,” he said. “This is a request, not a condition to holding negotiations. The only condition we put is that the government cancels the decision to attack the region.”
Libya, with Africa’s largest oil reserves, was producing 150,000 barrels a day yesterday, according to state-run National Oil Corp. This compares with an installed capacity of 1.6 million barrels a day before the 2011 overthrow of Muammar Qaddafi.
Citigroup Inc. cited the political impasse in Libya, a member of the Organization of Petroleum Exporting Countries, as one of the reasons the company raised its 2014 forecast for Brent crude to $103 a barrel from $93 last month. Brent, a benchmark for Libya’s Es Sider grade, was trading near $107 today in London.
Al-Hasy said forces of the Barqa region have blocked two attempts by the government to send military units toward rebel-held oil terminals since issuing its ultimatum.
The Barqa rebels are demanding a 15 percent share of national oil revenue for the eastern region. They say the territory, which has capacity to produce more than half of Libya’s oil, was neglected in favor of Tripoli and other cities in western Libya under Qaddafi’s four-decade rule.
The government has so far refused to commit to an agreement on revenue-sharing, saying Libya must first adopt a constitution.
“We stand by our demands,” Al-Hasy said.
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