Italy oil producer Eni SpA, which also happens to be the largest foreign oil producer in Libya, plunged over 5% on concerns the company's output will be crippled, after the company announced it is following BP in relocating all non-essential (for now) personnel away from Libya. Per Bloomberg: "Eni, which produced 244,000 barrels of oil equivalent a day
in Libya in 2009, fell as much as 5 percent, the most since May.
The company said in a statement that production is continuing as
normal. BP has no producing assets in Libya and is evacuating
families and non-essential staff, said David Nicholas, a
spokesman for Europe’s second-largest oil company." As we have reported on numerous occasions in the past, unlike Egypt Libya has a substantial amount of oil reserves: in fact, it holds the largest crude reserves on the entire continent, and Europe, particularly Italy and Spain are primary beneficiaries, which explains the plunge in those two stock markets.
Shokri Ghanem, chairman of Libya’s National Oil Corp., said he had no information about a disruption in oil production. Al Jazeera reported earlier that Libya’s Nafoora oil field had stopped producing because of an employee strike.
Eni said that while “no problems at plants and operational activities have been reported” family members of Eni workers are being relocated and repatriated. The shares fell 5 percent, and were down 4.2 percent to 17.59 euros as of 2:27 p.m. in Milan. The company also operates the Greenstream gas pipeline from Libya to Italy through the Mediterranean Sea.
BP was up 0.4 percent in London. BP will remain committed to doing business in Libya, Chief Executive Officer Bob Dudley said at a press conference today after announcing an agreement to buy stakes in licenses in India.
It seems everyone else is also pulling out of Libya:
Austria’s largest oil company OMV AG is withdrawing all non-essential staff from Libya. The Vienna-based company produced 34,000 barrels a day in Libya in the first nine months of 2010, its third-biggest production country after Romania and Austria. OMV shares fell as much as 6.4 percent, the most since October 2009, to 31.80 euros in Vienna.
Statoil ASA, the Norwegian energy producer, closed its office in Tripoli, spokesman Baard Glad Pedersen said by phone. Statoil participates in land-based oil production and exploration activities in the Mabruk field, operated by Total SA, and in the Murzuk basin, operated by Repsol YPF SA.
RWE AG, which is working on developing fields in two concessions in Libya, has suspended operations and recommended that international employees and relatives return home, Carolin Flemming, an RWE spokeswoman, said by e-mail. Some workers returned home on the weekend of Feb. 19, she said.
Royal Dutch Shell Plc said it has temporarily evacuated the families of expat workers in Libya. “We continue to monitor the situation in the country very closely,” said Kirsten Smart, a Shell spokeswoman, by e-mail.
Apparently only Repsol is in such a critical situation it won't dare to shutter operations.
Repsol, Spain’s biggest oil company is operating normally in Libya and isn’t withdrawing staff, Kristian Rix, a Madrid- based spokesman, said. Repsol had net production in Libya of 34,777 barrels a day in 2009 and has been present in that North African country since the 1970s. Repsol dropped 1.9 percent as of 1:23 p.m. in Madrid.
Of all, this one may be the ripest one to short. One thing not to short: crude.