Libya has potential for energy project surge
6 July 2023
MEED's August 2023 report on Libya also includes:
> Libyan pipeline contract awarded
> Libyan oil company in pipeline procurement talks
> Libya’s Waha Oil plans water plant
> Halliburton in talks for $1bn Libya oil project
> Eni signs gas deal in Libya
After a string of major energy project announcements in the country, Libya will likely be on course for a surge in project activity as long as it can maintain political stability and security.
However, the current period of stability is looking increasingly fragile amid threats from the military leader General Khalifa Haftar, who has warned of military action unless oil revenues are divided fairly within the next two months.
Eastern politicians claim the Central Bank distributes the bulk of oil revenues to the rival UN-recognised government based in Tripoli, even though the oil is produced in fields largely based in the east of the country.
The US special envoy to Libya, Richard Norland – eager to keep oil production flowing – had urged the east not to disrupt production.
The heightened political tensions come after a promising period of increased business activity within Libya that many believe could still pave the way for a boom in the country’s energy sector – if conflict can be avoided.
Recent announcements include a partnership between Libya’s National Oil Corporation (NOC) and Italy's Eni to develop two regions containing expected gas reserves of 6 trillion cubic feet.
The upstream Mellitah complex integrated expansion is meanwhile estimated to be worth $8bn. It is anticipated to have a production capacity of 750 million cubic feet a day (cf/d) of gas for a period of 25 years.
The deal between Eni and NPC for the expansion project was announced in January, but in April MEED revealed that the project still needed board approval before tenders for the main contracts could be issued.
It is possible that stakeholders in this project, like many other major projects in the country, are taking their time before finalising the contract to better gauge the political and security environment before they commit to large-scale investment.
Security company licensing system overhauled in Libya
Political instability
Libya has been plagued by frequent outbreaks of conflict for more than a decade since the removal of Muammar Gaddafi during the Arab Spring in 2011.
Since his removal, rival factions have continually vied for power and the country has failed to create a unified government.
At the moment, the country has two rival governments. The Tripoli-based Government of National Unity (GNU) exerts control over territory in the west of the country, and the Tobruk-based House of Representatives controls territory in the east.
Elections planned for 24 December 2021 were expected to unify the country under a single government, but they never occurred and many of the contested issues that derailed the democratic process in 2021 remain unresolved.
Key problematic issues include the eligibility criteria for presidential candidates and how candidates with military affiliations should be treated.
It has been reported that both sides have agreed that candidates with military affiliations must automatically resign from their military posts if they become candidates, but debate remains over whether provisions should be in place to stop them from resuming their positions once the electoral process has concluded.
Additionally, both sides have agreed that dual nationals that want to stand as president should give up the citizenship of the second country, but no mechanism has been decided on to verify compliance.
While it is clear that undisputed elections and the formation of a single unified government are the best-case scenario, it is possible that the country’s business community and energy sector will prosper without this in place.
UK foreign office asked to relax Libya travel advice
Conflict cooldown
Since the June 2020 conclusion of Operation Flood of Dignity, a year-long campaign in which Tobruk-aligned military forces tried to capture Tripoli, Libya has seen a significant improvement in its security situation and an uptick in energy sector activity.
The increase in business activity since then has shown that the country can attract international businesses for multibillion-dollar projects without a single unified government in place.
Other business deals that have been announced include the signing of a contract between NOC and US-based Honeywell for engineering work on the planned South Refinery project in Libya.
The project is expected to be carried out in two phases and is anticipated to cost between $500m and $600m.
Additionally, Libya’s Waha Oil Company is in advanced talks with US-based Halliburton over a $1bn project to rehabilitate the country’s Al-Dhara oil field.
On top of the series of announcements regarding major projects with international companies, there has also been an uptick in small-scale energy project activity, according to contractors active in the country.
All this points to the future looking promising for the country’s energy sector, as long as stability and security can be maintained. However, keeping the peace is unlikely to be easy, given the precarious nature of the political situation.
Sudan situation
The ongoing conflict in Libya’s neighbour, Sudan, has sparked an influx of refugees into Libya and rising uncertainty about future stability.
Analysts have warned that increased arms trafficking could be part of the fallout from the ongoing war in Sudan as control over the country’s arms storage facilities and borders is reduced.
Further flows of arms into the south of Libya could potentially embolden militias in the region and erode security.
Additionally, before the conflict in Sudan, the African Union and Arab League played significant roles in mediating the unresolved issues between Libya’s two rival governments.
Likely, at least some of the resources that would previously have been used to try to strengthen stability in Libya will now have to be used to deal with the escalating crisis in Sudan.
Maintaining peace and finding common ground between Libya’s rival governments is likely to be critical to the future growth of the country’s energy sector and the broader economy.
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In the UAE, by contrast, Adnoc Gas has remained broadly flat at $66.7bn, with its Q1 2026 net income dropping 15% and conflict damage estimates indicating that full capacity will not be restored until 2027. Borouge meanwhile held, while Adnoc Drilling and Adnoc Distribution gained by 14% and 8%, respectively.
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Banking and industry
The banking sector, which accounts for 33 of the 100 entries and 18% of the list by value, expanded by an aggregate 6.3% in absolute terms. Al-Rajhi Bank, the largest banking entry at $107.9bn, reported FY2025 net profit up 26% to SR24.8bn ($6.6bn); total assets passed SR1tn for the first time and Q1 2026 net profit rose a further 14%.
Emirates NBD, up 23% year-on-year to $47.1bn, reported FY2025 record profit before tax of AED29.8bn ($8.1bn) and likewise crossed AED1tn in total assets.
Kuwait Finance House also rose by 19%, Abu Dhabi Commercial Bank 19% to $28.7bn and Saudi National Bank 11%. Qatar National Bank stalled and slid 1%, while several smaller banks saw gains. Egypt’s Commercial International Bank rose 74% to $8.4bn off a depressed base, Jordan’s Arab Bank meanwhile rose 55%, Oman’s Bank Muscat by 52% and RakBank by 32%.
Several sectors have gained significantly owing to their direct exposure to the Iran conflict’s supply-chain repricing, including logistics, fertilisers and mining.
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Marsa Maroc, the Casablanca-listed port operator, also entered the list at $6.6bn, up 85% on an African expansion that spans 34 terminals across 20 ports following a Liberia management deal signed in February.
Adnoc Logistics rose 32% to $11.6bn, while Air Arabia, the Sharjah-based low-cost carrier, joined the list at $6.1bn as it absorbed redirected long-haul flows. Nakilat, the Qatari liquefied natural gas shipping operator, was the sector’s sole softener, down 12% on slower throughput.
Mining and fertiliser entries sit alongside the logistics gainers. Jordan Phosphate Mines is the cleanest single expression of the post-Hormuz repricing visible on the list – up 127% year on year to $13.2bn, as the World Bank’s April 2026 Commodity Markets Outlook projects fertiliser prices to rise nearly 31% in 2026.
Maaden rose 23% to $65.3bn after FY2025 net profit jumped 156%, backed by record phosphate production; high aluminium output; and rising silver, copper and aluminium prices linked to artificial intelligence, data centre, solar and electric vehicle demand.
Morocco’s Managem also entered the list at $19.7bn, having almost tripled in value in the past two years on cobalt, silver and copper prices and African expansion.
Sabic Agri-Nutrients rose 44% on a 30% 2025 net profit increase, while Fertiglobe rose by 40% – both potentially anticipating a 60% forecasted rise in urea prices.
Property and other trends
The direction of the property and real estate sector has been uniformly downward. The Iran conflict has driven both a slump in UAE property sales and prices and a similar tourism-adjacent correction in Saudi Arabia. Both the Mecca-focused Umm Al-Qura and Jabal Omar development firms have seen their valuations slashed by more than a third, while Makkah Construction & Development slid by 15%.
The UAE’s Emaar Properties and Dar Al-Arkan and Qatar’s Ezdan Holding have also all seen slides of more than 15%. Kuwait’s Mabanee, which rose by 22%, is the one exception in the sector.
In Saudi Arabia’s mid-tier, Acwa Power shed 29% in value even as its revenue rose 18% and its net income 5.4%. Elm Company likewise shed 33%, Dr Sulaiman Al-Habib 19% and the Saudi Tadawul Group 21%.
Mouwasat Medical Services, MBC Group, Nahdi Medical and Saudi Logistics Services fell out of the list entirely on the same trajectory. Each had reported FY2025 earnings rises before the decline. What corrected was the valuation, not the operations.
Acwa Power’s trailing four-quarter average price-to-earnings ratio was 166x, and even after this year’s decline sits at 88x against the Saudi market average of 17.8x. Elm sits at 26x, Al-Habib at 33x, Saudi Tadawul Group at 42x – all rich by any comparable benchmark.
Many of these entries have fallen away from their peak valuations as the cooling of the gigaproject programme since early 2025 has undermined sentiment.
One example that sits on the same axis from the UAE side is Abu Dhabi National Energy Company (Taqa), which fell by 28% from $95.3bn to $69.0bn despite a 6% net income rise, even as capital expenditure also expanded by 50%.
There are now nine entries from Morocco’s Casablanca bourse against six a year ago, with an aggregate value of $74.7bn, up from $50.8bn. Industrial contractor Societe Generale des Travaux du Maroc,entered via a December 2025 initial public offering (IPO). Several Moroccan stocks have also slipped, however, including Taqa Morocco, down 42%; Maroc Telecom, down 18%; Banque Populaire, down 13%; and Bank of Africa, down 10%.
There has been a similarly divergent trend among 2024 IPO entrants. While OQ Exploration & Production rose 68% to $10.1bn and is now the largest stock on the Muscat Securities Market, the UAE’s Talabat – 2024’s second-largest IPO at $9.2bn – has corrected 33% to $6.1bn.
The Multiply Group has been replaced on the list through its November 2025 merger into 2PointZero Group, which now sits in the top 30 entries at $19.6bn.
Regional repricing
Four trends underpin the list’s 7.2% recovery. The conflict has repriced specific cohorts sharply higher – logistics up 44%, mining and fertilisers up 43%, the Yanbu refiners returning, and Aramco recovering to $181bn – with gains contingent on the Strait of Hormuz remaining closed.
Regional banks have maintained last year’s momentum, with assets crossing trillion-unit thresholds and loan books supported by project activity. Six names have posted double-digit gains that are unlikely to reverse if conditions normalise.
Saudi mid-tier stocks have corrected largely on valuation rather than operations, despite many reporting earnings growth through 2025, as confidence in gigaproject-driven growth has weakened. Property has also softened in the region as conflict has reduced routine and religious tourism.
The 12-month outlook depends on whether Hormuz reopens, whether Saudi mid-tier valuations stabilise, and whether banking expansion holds under broader repricing.
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Developers win deals for $3.5bn of Mecca projects
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The Royal Commission for Makkah City and Holy Sites has awarded six real estate development deals. The projects, which cover a total land area exceeding 2.7 million square metres (sq m), will require a total investment of SR13.3bn ($3.5bn).
The sites are located within the neighbourhoods of Jurhum South, Al-Khalidiyah, Al-Hajlah, Al-Hindawiyah East, Al-Hindawiyah South and Al-Hindawiyah West. The projects will be delivered as partnerships with domestic real estate developers, institutional investors and dedicated private investment funds.
A consortium consisting of Makkah Construction & Development Company, Umm Al-Qura for Development & Construction Company and Al-Rajhi United Real Estate Company will develop the Hindawiya West and Hindawiya South districts, which have a combined area of nearly 1.15 million sq m, adjacent to the Masar Destination project. The consortium informed the Saudi Stock Exchange (Tadawul) that it received letters of award for the project on 31 May.
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Ladun Investment Company, in partnership with Al-Ayuni Investment & Contracting Company, has signed a deal for the Al-Khalidiyah district. With a targeted sales value exceeding SR6bn, the consortium will establish a closed-ended private real estate investment fund to execute extensive infrastructure works, subdivide the land plots, and handle subsequent marketing and sales. The detailed scope of works involves complete engineering designs, public park planning and utility coordination with entities such as National Water Company and Saudi Electricity Company, before a contract is signed by 9 June.
Saudi property dreams: Read the January 2026 MEED Business Review
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