TRIPOLI, May 29 (Reuters) - Libya confirmed on Wednesdaythat the headquarters of the state energy firm would move to thevolatile eastern city of Benghazi, a response to demands formore authority for the oil-rich region which may prove aheadache for international companies.
The National Oil Corporation (NOC) has faced calls since theend of the 2011 war that ousted Muammar Gaddafi to move more ofits operation to the eastern region, which accounts for around80 percent of Libya's oil wealth.
Officials have talked for months about restructuring thebody under a plan that has yet to be approved by the GeneralNational Congress, Libya's highest political body.
"We will start to build the headquarters for the NOC inBenghazi. Most of the NOC will be transferred to the newheadquarters," Prime Minister Ali Zeidan told a news conference.
"This was a decision that was taken by the prime minister'soffice. Benghazi is a city that deserves to have suchorganisations as part of a process to end centralisation."
Zeidan made no detailed reference to a current plan thatwould split upstream activities, such as exploration andproduction, from downstream activities, such as refining andmarketing, with the former to remain in Tripoli.
Oil is Libya's economic lifeline. The OPEC member pumps at arate of around 1.6 million barrels per day and has made thecountry rich despite its troubles.
Unlike before the war when the NOC dealt with all oilmatters, Libya now has an oil ministry in Tripoli which dealswith regulatory affairs and decision-making.
Any move of the NOC headquarters is likely to take time anddetails have yet to be finalised. However the decision may be ofworry to international companies for security reasons.
Benghazi is awash with weapons and has become a no-go areafor foreigners since September's deadly attack on the U.S.diplomatic mission in which the ambassador and three otherAmericans were killed.
The wrangling over how to split the NOC has added to broaderdiscontent in Benghazi and the east over the prospect of furthermarginalisation by Tripoli and fuelled calls for more autonomy.
The NOC's predecessor, the Libyan General Petroleum Company,was set up in Benghazi in 1968. The NOC was established in 1970,a year after Gaddafi came to power, and relocated to Tripoli.
Separately, a group of about 70 protesters were staging ademonstration outside Libya's major El Feel oil field, withdemands that included an NOC representative office in the southof the country, a senior Libyan oil industry source said.
He added that the protesters, also demanding jobs for localsas well as payment of salaries, caused no disruption at El Feel,which pumps 130,000 barrels per day and which is run by MellitahOil, a joint venture between the NOC and Italy's ENI.
British oil company BP earlier this month said it waswithdrawing some non-essential staff from Libya after Britain'sgovernment warned about deteriorating security in the capitalTripoli.
BP (BP.)