Libya's oil ministry has rejected the $8bn offshore gas projects deal signed between the country's state-owned NOC and Italy's Eni on 28 January, saying the agreement violates the law and was done without its approval.

The deal, which would be the largest single investment into Libya's upstream sector for decades, will add some 760mn ft³/d and 47,000 b/d of liquids from the Structures A&E project at plateau. An additional 85mn ft³/d is also expected from the Bouri Gas Utilization project, which was not explicitly mentioned by Eni or NOC in their separate statements.

The deal is key to Libya's hopes of meeting domestic gas demand and boosting exports to Italy, which slumped to the lowest since 2011 last year.

The oil ministry of the Government of National Unity (GNU) on 29 January specifically hit out against the terms of the deal, which it says increases Eni's share of the project's proceeds to 37pc up from a previously agreed 30pc. Its objection comes even though the deal was signed under the auspices of GNU head Abdelhamid Dbeibeh.

GNU oil minister Mohammed Aoun said Eni should shoulder more of the investment costs, which are currently shared equally between NOC and Eni.

Aoun is the second high-profile Libyan figure to reject the deal after the head of the parallel, eastern-based Government of National Stability, Fathi Bashagha, dismissed the agreement. Libya's political divisions remain a key obstacle to the development of its oil and gas industry, which has been crippled by years of war and underinvestment.

NOC released more details about the deal over the weekend, saying Structures A&E hold 6 trillion ft³ of gas reserves, that production will flow for at least 25 years and that it expects the project to generate net revenues to Libya of about $13bn. It also said more "offshore units" would be offered up for investment "soon."