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A militia takeover of one of Libya's largest oil fields has halted production for more than a week, the state-owned National Oil Corporation said Tuesday.

An armed group seized the Sharara site last week, prompting the NOC to declare "force majeure" - a legal measure exempting it from responsibility for failure to deliver on contracts.

The Southern Libyans said they blocked the oil field to protest against marginalisation and shortages of electricity, fuel and money and would only allow production to resume if Libya's unity government met its demands.

"The closure of Sharara will be maintained until the GNA (Libya's UN-backed Government of National Accord) meets the demands of the inhabitants of the marginalised south of Libya, which is severely deprived of services," said Mohamad Emeguel, who said he was a spokesman for the protesters.

"We call on the GNA to guarantee the supply of fuel (to petrol stations) and cash to banks, to pay more attention to the dilapidated medical sector, to reopen airports and to help disaster-stricken cities" in the south, he told AFP by telephone.

Local Libyans occasionally block access to site demanding employment at the oil fields or other privileges.

Standoffs are usually resolved following negotiations between the authorities and tribal groups, but the Sharara situation appears more complex.

The site, operated by a consortium of the NOC and four European energy firms, had been producing some 315,000 barrels per day, almost a third of Libya's current output.

The NOC said the force occupying the site belonged to the Petroleum Facilities Guard and ruled out negotiations, demanding the gunmen leave "immediately and without conditions".

But the unity government's military chief Major-General Abdulrahman al-Tawil said on Monday that the guard had not been paid since 2014.

"They just want their rights," he told Libya al-Ahrar television.

Two competing governments and a myriad of armed factions - including the Islamic State - group have since fought for influence in Libya, since the fall of former dictator Muammar Gaddafi.

The fighting has limited access to basic services, especially for the inhabitants of the desert areas in the south.

Libya's vital oil installations have frequently been targets of protests and attacks by groups with a variety of demands.