Nicosia: Libya's National Oil Corp said it signed an accord with a unit of Dubai's Al Ghurair Group to invest $2 billion (Dh7.34 billion) in upgrading the north African nation's biggest oil refinery.
National Oil and Al Ghurair agreed to form a joint venture called the Libyan Emirati Refining Co, or Lerco, which will own, operate and upgrade the 220,000 barrel-a-day refinery in Ras Lanuf, the Libyan company said on its website. The venture will have a starting capital of $350 million.
"Lerco will boost the production capacity of Ras Lanuf, improve the specification of the products, increase the output of light distillates that are increasingly in demand and reduce the production of heavy fuels," National Oil said.
State-run National Oil and the Al Ghurair unit called Trusta will each own half of Lerco and contribute $175 million to its capital, it said. Libyan company's Chairman Shokri Ganem and Essa Al Ghurair signed the accord on Monday in Tripoli.
Libya, the holder of Africa's largest crude reserves, seeks to increase its oil processing capacity and adapt the production of its refineries to the specifications of the Eur-opean Union, its largest export market, expecting demand for fuels to pick up when the global credit crisis eases.
National Oil plans to choose a partner this year to revamp and possibly expand the Azzawiya Oil Refining Co, its second- largest oil processing plant, Ganem said in Nov-ember.
The partner would take a 50 per cent stake in the plant, which processes 120,000 barrels of crude a day, in return for funding the upgrade, he said.
Libya has three other refineries, with a total capacity of 38,000 barrels a day, according to the US Energy Department's fact sheet on Libya.
