After the announcement of the Libyan National Oil Corporation that the Presidential Council had decreased its budget twice in 2019, the latter said it gave permission for the NOC to use 1.5 billion Libyan dinars in order to ensure steady levels of oil production.
The Presidential Council’s order says one billion and 2.5 million dinars will be used to maintain improved production and boost it to better levels, while 299 million dinars will be used by NOC to pay off debts to national companies so that these funds are later cut off from the fees of the foreign currency purchase transactions.
The Presidential Council also said that the NOC should file financial reports to the Ministry of Finance and Planning, adding that it should also open an emergency account at the Central Bank of Libya after taking permission from the Ministry of Finance.
This decision by the Presidential Council came after the NOC had issued a statement on Wednesday warning that Libyan oil production may fall precipitously over the next nine months if the government continues to withhold already approved budgets.
“The Presidential Council’s Resolution 375, dated March 20, 2019, approved the Corporation’s budget for 2019, with operational and capital expenses 39% and 40% lower than requested.” The NOC said in a statement.
The Chairman of the NOC, Mustafa Sanalla, said by July 2019, without NOC’s knowledge, the Presidential Council had gradually reduced the approved operational and capital budgets by 150 million and 100 million dinars respectively.
“The rest of the allocations were late. Capital budget allocations for May, June, July and August were only disbursed mid-September, resulting in unnecessary debt accumulation and some of the operating companies refusing to provide services, due to salary delays.” Sanalla explained.
