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Libya's oil reserves are estimated at 47 billion barrels, the largest in Africa and the ninth-largest in the world. It produced 1.8 million barrels a day in 2010, but civil war in 2011 caused production and exports to drop by more than two-thirds. Libya is heavily dependent on oil; in 2010 hydrocarbon receipts accounted for 91 percent of government income. Under the Gadhafi regime there was considerable mismanagement of oil and gas revenues. The new government has promised increased transparency, but significant reforms have yet to occur.

Libya's Performance on the Resource Governance Index

Libya received a "failing" score of 19, ranking 55th out of 58 countries. Very low scores on all components reflect decades of corruption and inefficiency.

(out of 58)
(out of 100)
55 Composite Score 19
57 Institutional & Legal Setting 11
Freedom of information law 0
Comprehensive sector legislation 0
EITI participation 0
Independent licensing process 33
Environmental and social impact assessments required 0
Clarity in revenue collection 33
Comprehensive public sector balance 33
SOC financial reports required 0
Fund rules defined in law 0
Subnational transfer rules defined in law N/A
48 Reporting Practices 29
Licensing process 50
Contracts 0
Environmental and social impact assessments 0
Exploration data 50
Production volumes 100
Production value 67
Primary sources of revenue 25
Secondary sources of revenue 0
Subsidies 0
Operating company names 100
Comprehensive SOC reports 0
SOC production data 19
SOC revenue data 0
SOC quasi fiscal activities N/A
SOC board of directors 50
Fund rules 0
Comprehensive fund reports 0
Subnational transfer rules N/A
Comprehensive subnational transfer reports N/A
Subnational reporting of transfers N/A
55 Safeguards & Quality Controls 15
Checks on licensing process 11
Checks on budgetary process 33
Quality of government reports 42
Government disclosure of conflicts of interest N/A
Quality of SOC reports 67
SOC reports audited 17
SOC use of international accounting standards N/A
SOC disclosure of conflicts of interest 0
Quality of fund reports 0
Fund reports audited 0
Government follows fund rules 0
Checks on fund spending 0
Fund disclosure of conflicts of interest 0
Quality of subnational transfer reports N/A
Government follows subnational transfer rules N/A
50 Enabling Environment 10
Corruption (TI Corruption Perceptions Index & WGI control of corruption) 7
Open Budget (IBP Index) N/A
Accountability & democracy (EIU Democracy Index & WGI voice and accountability) 4
Government effectiveness (WGI) 10
Rule of law (WGI) 18
Satisfactory Weak
Partial Failing
To explore all data and compare
scores, use the RGI Data Tool.

Institutional & Legal Setting (Rank: 57th/58, Score: 11/100) learn more

Libya's "failing" score of 11 is the product of a near-total lack of a legal framework governing resource extraction and revenue collection.

The National Oil Corporation (NOC) acts as ministry, regulatory agency, and state-owned company. It awards production-sharing contracts to foreign companies following open bidding rounds. Under Gadhafi, it was clear that open bidding was only the beginning of the licensing process; final agreements depended on further negotiations. The extent of the NOC's discretionary power under the new government has yet to be established.

The NOC collects payments from resource companies and transfers them to a special account held by the central bank. Some resource-related revenues are not included in government budget accounting and Libya's public sector balance is not published. Environmental impact assessments are not required, and no freedom of information law exists. With many Libyan government websites no longer functioning, the amount of information that will be available under the new government remains to be seen.

Reporting Practices (Rank: 48th/58, Score: 29/100) learn more

Libya received a "failing" score of 29, reflecting a lack of disclosure on most aspects of the petroleum industry.

Relevant legislation, including the Petroleum Law of 1955 and the regulations covering licensing procedures, is not available from official sources. Once the licensing process has been completed, only basic information is released about winning bids, and contracts are not published in full.

The central bank is the only institution that provides information on hydrocarbon revenues. It produced annual reports from 2005 to 2010 containing data on reserves, production volumes, prices, the value of resource exports, the government's share in production-sharing contracts, the names of companies operating in Libya, and production data by company.

Safeguards & Quality Controls (Rank: 55th/58, Score: 15/100) learn more

With few effective checks on the licensing process and a general lack of public access to information on petroleum revenues, Libya earned a "failing" score of 15.

By law, the General People's Committee was required to approve contracts during the Gadhafi era, limiting the discretion of the NOC. In practice, however, the committee provided little real oversight. Libya's post-revolution Transitional National Council has yet to form a parliament, and the oversight responsibilities of elected officials are unknown.

The national Audit Bureau is required to review resource revenues. Under Gadhafi, it reported to the General People's Congress, but its reports were rarely made public. In June 2012 the Audit Bureau published its first post-revolution report, which included a critical assessment of the NOC's activities.

Enabling Environment (Rank: 50th/58, Score: 10/100) learn more

Libya performed particularly poorly on measurements of accountability and democracy and corruption control, leading to a "failing" score of 10.

State-Owned Companies (Rank: 39th/45, Score: 19/100) learn more

The NOC has a number of fully state-owned subsidiaries. It maintains a share in all production-sharing contracts and operates without ministerial oversight. In the past, the NOC provided little information on revenues, but since the revolution it has published reports containing export volumes and destinations, prices, and production volumes.

Natural Resource Funds (Rank: 23rd/23, Score: 0/100) learn more

The Libyan Investment Authority was created in 2006 to manage the country's oil revenues. Before the revolution it was primarily, though unofficially, under the authority of the prime minister, and many cases of mismanagement were reported. No information was published on the fund's assets or activities and its financial statements were not audited. Rules governing deposits are currently unavailable. The new prime minister has yet to appoint a board of trustees to manage the fund.

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