ZESA Holdings operations

Last week the state-owned General Electricity Company of Libya (GECOL) and German conglomerate company, Siemens, signed a memorandum of understanding (MoU) to assist in the completion of the Ubari power plant.

According to the Libya Herald, the MoU will include urgent maintenance to various other power plants.

Sources told media that the German firm that the agreement signed ‘‘covers GECOL priorities and support that Siemens will provide especially with regards to fast-tracking the projects and giving high priorities to the service needs’’.

Libya power generation

The Libya Herald reported that “it is not clear if this agreement will indeed lead to increased power generation and hence a reduction of power cuts across Libya.

“The Faiez Serraj-led Presidency Council/Government of National Accord had promised that power cuts would be reduced this year. However, as temperatures have risen this summer, acute power cuts – including some total blackouts have already hit the country.”

The Libya Herald explained that the main obstacles to foreign technicians from all companies have been security and payment.

“Some companies used to working in high risk zones have indicated that they can mitigate some security risks, which leaves the issue of payment of outstanding monies.”

Crude oil collapse

According to the Libya Herald: “The collapse in world crude oil prices and the fall in Libya’s oil production has reduced the Libyan state’s revenues.

“Libya is operating on a recurring annual budget deficit and its annual revenues fail to cover even state-sector salaries. It is surviving by dipping into fast diminishing foreign currency reserves.”

Media added: “Fighting around the main oilfields has stopped and the National Oil Corporation has succeeded in increasing oil production in 2017 to above the one million barrels per day mark.

“This should give the Libyan authorities some leeway if they decide to prioritise power generation by diverting much need scarce foreign currency to foreign electricity contractors.”

 

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