Reuters said Tuesday that Royal Dutch Shell is considering a return to Libya with a plan to develop new oil and gas fields and infrastructure, as well as a solar project.
The plan, after a decade of absence from Libya due to security issues, marks a rare new oil and gas foray by the energy major as it seeks to cut fossil fuel investment and slash greenhouse gas emissions.
"In that strategy, Shell still needs some new projects to maintain output as reserves in existing oil and gas fields have rapidly fallen after years of slowing drilling activity." Reuters said.
Under the Libya plan, discussed with state-run National Oil Corporation (NOC), Shell would explore for new oil and gas fields in several blocks in the onshore Sirte and Ghadames basins, as well as the offshore Cyrenaica basin. Shell also proposed re-developing ageing fields such as block NC-174 in the Murzuq basin and developing new fields including in the Ain Jarbi block.
The plan includes developing a solar energy project south of the Sirte Basin, part of Shell's strategy to cut oil output by up to 2% a year by 2030 and hike investment in renewables and low carbon technologies to make up 25% of its budget by 2025.
"Shell is preparing to return as a major player," Shell's proposal said, according to the sources and details seen by Reuters. The proposal did not give details about the value of any investment or scale of the oil, gas and solar projects.
Shell left Libya in 2012, amid the turmoil that erupted after the unrest following ousting and killing of Muammar Gaddafi in 2011. The sources told Reuters Shell's board could approve the plan to return within months.
Shell's plans, the report says, include helping Libya capture gas that is extracted with oil but which is now released into the air or flared. It also aims to develop oil storage terminals in the Mediterranean ports of Es Sidr and Ras Lanuf.
But under Shell's proposals seen by Reuters, the company would be allocated Libyan crude and refined oil product cargoes from Libya to sell in the international market.