The United States has intensified its commitment to diversifying energy development in Libya, focussing on modernising the oil and gas industry, increasing transparency, and improving service delivery.
This initiative is particularly aimed at integrating American companies into the Libyan market.
The U.S. Embassy in Tripoli and the United States Agency for International Development (USAID) are spearheading efforts to create a conducive business environment, promote fiscal transparency, and implement targeted reforms within Libya. This strategy includes recent multi-million-dollar contracts awarded to U.S. firms.
Libya’s economy heavily relies on its oil and natural gas exports, which contribute to around 65% of its GDP and over 90% of the government’s revenue. USAID’s strategy is to bolster public financial management and enhance transparency and accountability through institutional reform. This approach aligns with USAID’s Strategic Framework for Libya 2021-2024, aiming to provide technical support for the sustainable and efficient management of Libya’s natural resources. USAID plans to collaborate with the Libyan government to establish transparent budgeting processes and improve the management and oversight of oil and gas revenue. These reforms are anticipated to foster a more investment-friendly environment in Libya, potentially attracting substantial capital, services, and technology.
U.S. companies are increasingly involved in developing Libya’s oil and gas infrastructure, both upstream and downstream. Notably, in March, Libya’s National Oil Corporation (NOC) contracted Honeywell-UOP, a U.S. firm, to construct the South Refinery with a capacity of 30,000 barrels per day, at an estimated cost of $500-$600 million. Additionally, Halliburton is expected to finalise a one-billion-dollar deal with the NOC for the reconstruction of the Al-Dhara oil field in Central Libya. ConocoPhillips, another major American player in the Libyan hydrocarbons sector, is in talks to expand its investments, especially in the North Jalu Project and Plot NC 98. The company holds a significant 20.4% interest in the Waha Concession in the Sirte Basin.
In September, the American Chamber of Commerce (AmCham) in Libya facilitated a virtual briefing by Schlumberger, which recently signed a contract for drilling operations in the Murzuq Basin. These developments reflect growing U.S. confidence in Libya’s energy sector and the country’s eagerness to collaborate with multinational corporations to boost oil production. AmCham Libya, in partnership with the Libya Energy & Economic Summit (LEES) in Tripoli next month, is identifying key areas for U.S. and global firms’ involvement in Libya’s energy and infrastructure sectors. The US-Libya Business Association, another partner at the event, assists companies in navigating the Libyan business landscape and fosters commercial and diplomatic exchanges between the two nations.
In sustainable energy, the U.S. Embassy in Libya outlined a strategy last October to aid Libya in achieving its goal of sourcing 20% of its electricity from renewable resources by 2035. A recent meeting between Libya’s Minister of Planning, Mohamed al-Zidani, and U.S. Chargé d’Affaires, Jeremy Brent, underscored the U.S.’s dedication to modernising Libya’s energy sector and encouraging American investment in Libya’s energy and infrastructure. Additionally, USAID announced a package last July focused on increasing Libya’s power generation capacity, emphasising the integration of renewable energy sources and the reduction of energy consumption.
