Lebanon open for oil exploration, finally

After a three-year delay caused by political paralysis in January Lebanon re-launched first licensing round for exploration and production rights in five blocks (1, 4, 8, 9 and 10). Lebanon’s cabinet approved a bid by a consortium of France’s Total, Italy’s ENI and Russia’s Novatek. The consortium was the only bidder

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I wonder how is this going to play out. Don’t really need another ME drama. Block 9 borders Israeli waters. Lebanon considers Israel an enemy state and has an unresolved maritime border dispute with it over a triangular area of sea of around 860 sq km that extends along the edge of three of the five blocks put up for tender. Israel announced to attack to Lebanon again is Hezbolah moves a finger

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Part of the deal between Hariri and the ruling mafia.

 

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I didn't notice that Hariri resigned. And now he withdrew the resignation

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Why so few companies bid? The companies are too afraid of Lebanon because of money from the proceeds of gas could run afoul by going to the five families pockets. Details of the profit-sharing-agreements (PSAs) would also be appreciated.

 

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I wonder whether this fragile government can actually guarantee security there

Just day earlier, Lebanon Prime Minister Saad Hariri has withdrawn his resignation, following his shock announcement to stand down a month ago. In his resignation statement on 4 November, Hariri had accused Iran and militant group Hezbollah of taking over his country and destabilizing the broader region, saying he feared for his life.

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It was about time. All neighboring countries are producing oil. Submarine geological structures don't respect national boundaries or exclusive economic zones. Yet it lags behind neighboring Israel, Cyprus and Egypt in tapping the deposits. So, why is Lebanon a decade behind? While the existence of large fields in the eastern Mediterranean has been known since 2009, Beirut has yet to start drilling for the black stuff.

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Ever since Israel made its game-changing gas discovery in the Levant Basin (this same area Lebanon has now, finally, made some move on) it's become a wildly attractive prospect. It's definitely going to be a tricky geopolitical drilling feat. Syria also has maritime territory in this basin, but I think the Russians have secured that already. 

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1 minute ago, Kate Turlington said:

It's gets almost no media attention, though

Maybe that is good. Considering what happen to other oil rich ME countries with fragile political and religious system 

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All this political and religious tension is nothing new. Political paralysis and violence have held up decision-making since the assassination in 2005 of Rafik Hariri, a former prime minister. Religious factions have been jostling for influence in the government and parliament, where seats are distributed along confessional lines. Sectarian rivalries have grown since the outbreak of Syria’s civil war, with competing power centers supporting opposite sides in the conflict.

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(edited)

Something tells me there will be no armed conflict there since foreign major oil companies arrived now. They wouldn’t invest if they sensed war. Tensions will continue but multimillion companies can handle that.

Edited by Stephen

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Right. Fragile government+religious tensions+bribery=good business

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22 minutes ago, JohnAtronis said:

I wonder how is this going to play out. Don’t really need another ME drama. Block 9 borders Israeli waters. Lebanon considers Israel an enemy state and has an unresolved maritime border dispute with it over a triangular area of sea of around 860 sq km that extends along the edge of three of the five blocks put up for tender. Israel announced to attack to Lebanon again is Hezbolah moves a finger

here is eyebrow raiser. "America has been trying for several years to broker a resolution between the two countries, which have no diplomatic relations." 

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Lebanon is facing more problems. Even if manage to solve its problems such as political and religious divisions and make peace with Israel, will they be able to find the market for its oil and gas?

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Good point. They can write off regional customers. The Egyptian, Israeli and Turkish governments are close to signing supply deals with each other. 

 

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Don't think they're planning to start drilling until 2019, and anything could happen in this area by then. But they definitely have a huge domestic market. 

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No chance of any production coming out of here before mid-2020s

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Not sure this is ever going to happen. Crisis intensifying again to dispel any notions of potential for political unity to make this feasible. President Michel Aoun and speaker Nabih Berri--age-old enemies--are trading nasty barbs that will ignite violence and paralyze government. 

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