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Libyan rebels occupying oil ports refuse to deal with new PM

Source: Reuters - Wed, 7 May 2014 19:00 GMT
Author: Reuters
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* Stance threatens efforts to reopen terminals

* Maiteeq sworn in as PM after chaotic election

* Seizure of ports, oilfields has cut vital crude output (Details on budget)

By Ayman al-Warfalli and Feras Bosalum

BENGHAZI/TRIPOLI, Libya, May 7 (Reuters) - Rebels occupying major oil ports in eastern Libya said on Wednesday they would not deal with new Prime Minister Ahmed Maiteeq, a stance that could threaten efforts to reopen terminals in the OPEC producer.

Maiteeq's predecessor Abdullah al-Thinni had reached an agreement with the rebels to reopen four of the ports, though only the smaller ones, Hariga and Zueitina, have been handed over to government forces.

Both sides had agreed to hold further talks over the larger Ras Lanuf and Es Sider exports terminals. But the rebels' comments on Wednesday suggested those efforts could hit difficulties.

"We refuse to deal with Ahmed Maiteeq ... Maiteeq came to power illegally," rebel spokesman Ali Hasi said, without elaborating.

Maiteeq, a businessman, was sworn on Sunday in after a chaotic election in parliament. Many deputies have challenged his appointment.

There was no immediate comment from the government.

The North African country has been mired in turmoil since the 2011 overthrow of strongman Muammar Gaddafi.

Its government and army have struggled to assert authority over a country still awash with arms and rival militias, some of whom have seized oil ports and fields demanding regional autonomy and a greater share in revenues.

DEFICIT

Their actions have cut oil output to 250,000 barrels a day, down from 1.4 million bpd in the summer, eroding public finances which are almost entirely dependent on crude. Parliament has failed to approve a budget for this year.

Libya will post a budget deficit of 10 billion Libyan dinars ($8 billion) because oil revenues will reach only 34.7 billion dinars, said Mohammed Ali Abdullah, head of the parliamentary budget committee.

The deficit might be higher as the draft, to be voted on Sunday, assumes annual oil production of 800,000 bpd and an oil price of $100 a barrel. Total expenditures will be 59 billion dinars, mainly for public salaries and subsidies, Abdullah said.

He did not say how the deficit would be funded. The central bank had foreign reserves worth $115 billion at the end of February. Oil exports are also the only source of funding for annual imports worth $30 billion.

In another sign of turmoil, most air traffic at Benghazi airport came to a halt for hours after a fight among ground staff.

The two main local carriers, Libyan and Afriqiyah Airlines, suspended flights after a member of the ground staff tried smuggle two Chadians without travel documents on board of one of their flights, airport officials said.

The employee scuffled with a colleague who had tried to stop him, a source at ground handling firm al-Shorooq said. ($1 = 1.2265 Libyan Dinars) (Reporting by Ayman al-Warfalli, Feras Bosalum and Ahmed Elumami; Writing by Ulf Laessing; Editing by Andrew Heavens/Ruth Pitchford)

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