Libya, long regarded as one of Africa’s most geologically rich petroleum provinces, is re-emerging with renewed focus and ambition. After years of underinvestment, geopolitical instability, and widespread field shut-ins, the National Oil Corporation (NOC) is actively working to reposition the country as a key energy partner on the global stage, underpinned by ambitious production growth targets.
A major area of focus has been the optimisation and redevelopment of mature fields experiencing natural decline, with the NOC, its subsidiaries and existing IOC partners engaged in reactivation and workover campaigns. Complementing these efforts, the recently launched and long-anticipated licensing round underscores Libya’s intent to attract new international oil companies (IOCs) into its prolific basins, offering significant upside opportunities, alongside inherent challenges and considerations.
Looking ahead, attention is also turning to the potential contribution of the country’s unconventional and untapped shale oil and gas resources as part of Libya’s broader production strategy.
A timely Bid Round
The new block licensing round announced by the NOC comes at a time of geopolitical significance. With Europe continuing to seek improved energy security, Libya offers both geographic proximity and untapped resource potential. The country’s location on the southern edge of the Mediterranean, combined with its substantial oil and gas reserves, positions it as a natural supply partner for European markets, as well as interest from the US, Asia and Far East.
This licensing round, currently being promoted through a global roadshow by the NOC, opens the door to both established operators in Libya and new entrants. However, its success will depend on Libya’s ability to reassure potential investors regarding its fiscal regime, political stability, and the technical challenges associated with its upstream sector.
A 2 Million Barrel Per Day Target
Oil production in Libya currently averages around 1.4 million barrels per day (bpd), a sharp recovery from previous lows. The National Oil Corporation (NOC) has outlined a national objective to increase production to 2 million bpd within the next three years. This will be dependent on several key enablers: international investment and exploration activity; the restoration of infrastructure following extended periods of field inactivity; continued political and security improvements; and revisions to the IPSA IV fiscal framework to reflect an increasingly more competitive, investor-friendly landscape in Africa.
Legacy and momentum – current IOC activity
Despite Libya’s past challenges, several major IOCs remain active or have resumed operations, contributing significantly to production and field development:
- Eni, in partnership with NOC, operates the Greenstream pipeline, transporting gas from the Wafa and Bahr Essalam fields directly to Sicily. Eni’s recent offshore discovery in Contract Area D (Sirte Basin) signals a strategic push towards developing LNG exports. While their current focus is offshore, ENI also hold significant positions in onshore Ghadames and onshore Sirte Basin assets.
- BP, a joint partner with Eni in Libya, is also exploring further involvement in LNG developments.
- Repsol, through Akakus Oil Operations, has drilled and completed multiple wells in the Sharara field, making gains aiming to sustain production and offset natural decline.
- OMV has resumed exploration in the Sirte Basin with NOC via Zueitina Oil Operations, marking a return after a hiatus since 2011.
- TOTAL Energies has revived activity in the Mabruk Oil Field and increased its stake in Waha Oil Company, targeting development of previously shut-in assets including NC-98, NC-170, and NC-129.
- PGNiG lifted its force majeure in early 2023 after a decade, resuming exploration activities in Libya.
In parallel, state-owned NOC subsidiaries are making notable contributions including but not limited to:
- WAHA Oil Company reported producing over 350,000 bpd in November 2024, the highest in over 11 years.
- Zallaf Libya Oil & Gas announced a new discovery in the Erawin Field (Murzuq Basin) in 2023 as part of a strategy to tap smaller, underutilized fields.
- Arabian Gulf Oil Company (AGOCO) confirmed new onshore discoveries in the Sirte Basin, furthering NOC’s aim to boost domestic output.
- Sirte Oil and Gas Company reached a crude output of 103,000 bpd in December 2024 and over 100 million cubic feet of gas per day in the Al-Hatiba field, a notable achievement since 2007.
Technical challenges – turning to global expertise
Libya’s geologically diverse subsurface, combined with the legacy of prolonged shut-ins, presents a number of technical challenges in field development and production optimisation. Addressing these challenges has drawn upon international expertise. Core Laboratories, for example, has played an important role through its delivery of specialised technical workshops, application of advanced regional subsurface knowledge, and ongoing collaboration with local institutions such as the Petroleum Research Centre, a subsidiary of the NOC.
Opportunities versus risks
For international oil companies (IOCs) looking for value proposition, Libya offers a compelling blend of strategic location, proven reserves, and new frontier potential.
High-quality hydrocarbons, favourable reservoir characteristics, low development costs, and underexplored acreage all contribute to its appeal. Existing infrastructure, including pipelines like Greenstream with direct links to Europe, adds to the country’s logistical advantages. The political will and renewed leadership focus to revitalise the sector, most notably through the NOC’s active licensing campaign, has not gone unnoticed by industry observers.
While the fundamentals are attractive, several considerations remain top of mind for operators evaluating entry or re-engagement. While stability in key producing areas has improved, evolving security conditions and international travel advisories will remain a point of continued monitoring and consideration, particularly in more remote interior regions.
On the fiscal side, the government has taken steps to modernise the IPSA IV framework. Updates include a profitability-based sliding scale (R-factor), the removal of the daily production base (B-factor), and the NOC’s commitment to cover contractor income tax, reforms designed to enhance returns and shorten project payback timelines. Infrastructure renewal, meanwhile, continues across the country through joint NOC-IOC initiatives aimed at production recovery and field optimisation.
A region worth watching
With shifting global energy dynamics, Libya’s re-emergence could prove pivotal, not only in supplying Europe, but in re-establishing its position as an international regional hub for investment. For companies seeking scalable, early-mover opportunities, Libya presents a uniquely attractive prospect. Recent policy changes, improving infrastructure, and growing openness to collaboration indicate a sector in transformation.
If the licensing round proves successful, it will mark not only a technical and commercial milestone but also a broader signal that Libya is once again a serious player on the energy map. Momentum will be closely observed at the upcoming stops on the NOC’s roadshow, including visits to London in April, and Frontier’s Africa Energies Summit in May.
The coming months will be decisive, not just for the NOC’s licensing efforts, but for the broader redefinition of Libya’s role in the global energy landscape.
