Libya is stepping back into the spotlight with its first oil and gas exploration tender in nearly two decades, signaling an ambitious push to reenergize its energy sector. The newly announced initiative offers shared production agreements (SPAs) across 22 exploration and development blocks—11 onshore and 11 offshore—some of which already contain undeveloped discoveries. The move marks a pivotal moment for Libya, a country with the second-largest oil reserves in Africa, and could lay the foundation for a significant economic rebound.
Libya’s economy is heavily dependent on oil, accounting for more than 95% of its revenue. However, since the 2011 fall of Muammar Gaddafi, political instability and civil conflict have severely disrupted production and discouraged international investment. The last tender was held in 2007, and since then, foreign companies have had little incentive to invest due to risk-averse contract models and an unpredictable security environment. This tender breaks that pattern. The introduction of SPAs—where risks and rewards are shared between the government and international oil companies—represents a strategic shift aimed at reigniting investor confidence.
The scale of Libya’s ambitions is clear. The country aims to raise its oil production from 1.4 million to 2 million barrels per day. Unlocking new reserves through this tender is central to that goal. Libya’s geographic proximity to Europe and its substantial untapped resources make it a potentially critical supplier in a world grappling with energy security challenges.
International interest is already percolating. Major players such as Eni and BP have resumed drilling, reflecting renewed confidence. The more investor-friendly terms of SPAs could bring in additional long-term partners, helping Libya overcome past hesitancy.
But challenges remain. Political fragmentation continues, despite a recent resolution that temporarily eased tensions. Rival governments in the east and west still pose risks to stability. Past disruptions have cost Libya more than 700,000 barrels per day in lost production. Any relapse into conflict could once again derail progress and scare off much-needed foreign investment.
Libya’s infrastructure is also in urgent need of modernization. Years of underinvestment and neglect have left pipelines, refineries, and export terminals outdated or nonfunctional. A full upgrade will require an estimated $17 billion in capital—a daunting but necessary investment to support increased production capacity.
Additionally, global energy trends pose a time-sensitive challenge. While demand for oil remains strong in the short term, the transition toward renewables is gaining momentum. Libya must act quickly to secure its place in the global market before declining fossil fuel consumption reduces its leverage.
The future success of this tender will depend on several interconnected factors. First, political stability must be maintained to allow safe, uninterrupted operations. Second, the financial terms offered through SPAs must remain competitive to draw high-quality international partners. Third, infrastructure development must keep pace with new discoveries to ensure efficient output. Lastly, Libya must move swiftly to capitalize on current market conditions while they remain favorable.
Libya’s latest tender is more than an investment opportunity—it is a test of the country’s ability to overcome past instability and chart a path toward sustainable growth. If successful, it could usher in a new era for the Libyan oil industry, one marked by resilience, collaboration, and renewed global relevance.