Libya Declares Major Oil Discovery Commercial as Production Revival Gains Pace

Libya’s National Oil Corporation (NOC) and Austrian energy company OMV have declared the Essar oil discovery commercially viable, marking a significant milestone in the North African nation’s efforts to rebuild its oil sector through partnerships with international energy majors.

The NOC confirmed that OMV Austria’s Essar discovery has been deemed commercially viable following the drilling of well B1-106/4 and the completion of the evaluation process for the development plan submitted by the Austrian firm. Total reserves from the discovery are estimated at 195 million barrels of oil from the upper and lower Sabil reservoirs, with expected production capacity of approximately 5,000 barrels per day.

Development work for the discovery will commence under the operatorship of Zueitina Oil Operations Company. The NOC indicated that production could begin relatively quickly owing to the site’s proximity to existing surface facilities, which should facilitate a more efficient development timeline.

The announcement represents the latest progress in Libya’s concerted effort to revitalise its upstream oil industry after years of civil conflict and political instability. OPEC’s second-largest African producer has embarked on an ambitious campaign to attract major international oil companies back to the country.

Last year, Libya launched its first bid round for oil and gas exploration in 18 years. The previous licensing round took place in 2007, four years before the overthrow of Muammar Gaddafi in 2011, which precipitated an extended civil war characterised by competing factions and tribal interests seeking control over key institutions and major oilfields.

The NOC recently formalised exploration and production-sharing agreements from its 2025 bid round with several international companies, including Repsol, Turkish Petroleum, Eni, QatarEnergy, and MOL. This represented the country’s first major licensing initiative in 17 years, signalling renewed confidence in Libya’s oil sector stability.

Libya’s crude oil production has recovered substantially, reaching approximately 1.4 million barrels per day, the highest level in more than a decade. Government officials have set ambitious targets of 1.6 million barrels per day by year end, with longer-term aspirations to achieve 2 million barrels per day. These production goals underscore Libya’s determination to reclaim its position as a significant contributor to global oil supply and maximise revenues from its substantial hydrocarbon reserves.