Lebanon is preparing to join the ranks of oil and gas producers in the Mediterranean after lagging behind neighbors such as Israel and Egypt for years, unable to even start exploration. The country's government, Bloomberg reports, is now gearing up to tender the first offshore fields in its history, until now held back by long years of political bickering.
Three years ago, seismic research suggested the country may have access to some 850 million barrels of crude and at least 96 trillion cu ft of natural gas. Getting to exploit these reserves, however, has proved impossible so far, in a country torn by hostility between different political factions and no president for two years.
Now, it seems, the main participants in the conflict are ready to overlook their differences in the name of energy revenues. Part of the reason for this new readiness to work together may be reports that Israel might abuse its offshore oil and gas rights and steal from Lebanon's deposits. The two countries have an ongoing dispute over an area that could contain billions of dollars worth of oil and gas.
Although there is no certainty that Lebanon's government will manage to get to the stage of tendering offshore blocks, if it does, this will be a major development. The head of Lebanon's parliamentary energy committee Mohammad Kabbani told Bloomberg that the authorities have finally agreed on the 10 blocks that will be tendered. Delineating tender blocks has been an additional challenge for Lebanon.
Related: Breakthrough In Oil Sands Tech Could Transform The Industry
Aside from worries about getting swindled out of its oil and gas by Israel, which are more or less part of Middle Eastern culture, Lebanon has more pressing matters to attend to, namely its huge public debt, which at end-August 2015 stood at US$68.88 billion, or 141.5 percent of GDP.
There are already 46 companies that are pre-qualified to explore Lebanon's offshore hydrocarbon reserves. After the decrees representing the framework of how these reserves will be exploited is approved by the government, they will be free to choose which blocks to bid for, Kabbani told Bloomberg. The approval is expected "shortly".
By Irina Slav for Oilprice.com
More Top Reads From Oilprice.com:
Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry. More