Cape Town (Platts)--7Jul2009

The Libyan government's plans to raise production capacity to 3 million
b/d by 2012 have been revised down largely due to OPEC constraints, National
Oil Corporation's exploration manager Fituri Elhag said Tuesday.

Speaking on the sidelines of the CWC energy conference in Cape Town,
Elhag said the 3 million b/d target was now was "history."

The International Energy Agency in its latest monthly report said the 3
million b/d had been revised down to 2.3 million b/d by 2013--but even this
lower target looks optimistic.

It said its projections see Libyan capacity reaching just 1.94 million
b/d by 2013 and just over 2 million b/d by 2014.

Tripoli had said it hoped to increase output to 3 million b/d by about
2012 but analysts say there is little incentive for companies to hike
capacity, given Libya's OPEC quota of 1.47 million b/d.

Despite expectations that Libya's oil sector would see an influx of
foreign investment and increased production capacity following the lifting of
US sanctions in 2004, the IEA said that projects have been stalled by
excessive bureaucratic delays and even more changes in contract terms.

Ehag also said Libya was unlikely to hold another licensing round in the
near future. "Not before 2010," he said, when asked if the North African
country was planning another bid round.

Libya has held four bid rounds since 2005 since international sanctions
on were lifted in 2004.