Lebanon to issue offshore gas exploration permits

Lebanon gas exploration, photo: Reuters

Lebanon plans issuing an exploration permit for bloc 9, even though it disputes 850 square kilometers of it with Israel.

The Lebanese press reports that Lebanon will open its waters for new oil and gas exploration permits. One of the permits Lebanon intends to issue is still being contested by Israel.

In March 2013, Lebanon initiated a preliminary vetting process for gas companies which want to operate in the country. 12 international operators have passed this stage as well as 34 more non-operator firms. While Lebanon intended to provide ten offshore permits, the state's regulatory and political instability has led to delays with their issuing.

A source with connections in Lebanon's Ministry of Energy and Water told "Globes" that the discovery of Egypt's gas fields last year, as well as the Israel-Turkey reconciliation agreement (expected to promote a gas deal between the states), has led the ministry to push forward for an early publication of the permits during the last two weeks.

According to the reports, Lebanon plans to initially issue permits for four blocs, including 1, 4, 9 and 10, and later publish the rest. The exact boundaries of Bloc 9 remain unclear, and the issue is subject to a dispute with Israel. In 2010, Lebanon turned to the UN with an appeal stating that Israel's exclusive economic zone (EEZ) in fact extends into Lebanon's EEZ. Israel provided its response to the UN one year later. The US has attempted to mediate between the parties in order to reach a compromise, but Israel rejected this proposal.

The disputed area totals some 850 square kilometers and is triangular, with its vertex in Rosh Hanikrah and its base along the line shared by Israel, Cyprus and Lebanon's EEZ. An agreement signed between Israel and Cyprus in December 2010 supports the Israeli claim while a similar agreement signed between Cyprus and Lebanon has not been authorized by the Lebanese Parliament. As stated above, Lebanon intends to publish the bloc anyway.

The same source, affiliated with the Lebanese Ministry of Energy, added that Lebanon estimates it has large gas deposits, "at least the size of Tamar". The Israeli Ministry of Foreign Affairs said, "We prefer to avoid responding, due to the sensitivity of this issue."

Israel's economic waters have been closed to exploration for four years. As "Globes" reported last week, the Ministry of National Infrastructures, Energy and Water Resources has been planning to issue 60 new gas and oil exploration permits.

During the first stage and probably by the end of the year, one third to one half of the permits will be distributed.

During the past few months, in preparation for the initiation of maritime exploration, Minister of Energy Yuval Steinitz and the ministry's CEO Shaul Meridor have been carrying out meetings with international energy firms in order to convince them to operate in Israel. The ministry recently ordered a comprehensive environmental survey for the maritime exploration and extraction of oil and natural gas, which is actually the first such survey to be carried out in Israel. It is intended to provide the Petroleum Commissioner with data before providing new exploration and extraction rights.

Published by Globes [online], Israel business news - www.globes-online.com - on July 18, 2016

© Copyright of Globes Publisher Itonut (1983) Ltd. 2016

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Lebanon gas exploration, photo: Reuters
Lebanon gas exploration, photo: Reuters
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