Lebanon’s parliament today approved a law that opens its offshore areas for the first time to oil and natural-gas exploration according to a Bloomberg report.
The measure represents a fresh opportunity for energy companies in a maritime region that Norway-based oil and gas fields surveyor Petroleum Geo-Services, has described as “exciting.” Parliament spokesman Mohammad Ballout confirmed passage of the law.
Large discoveries of gas in the Eastern Mediterranean have sparked a debate between Lebanon and Israel over their respective rights to energy resources in the area. While Lebanon has not officially accused Israel of exploring for gas outside its territorial waters, the issue has inflamed tensions because the two states are technically at war.
Israel’s Minister of National Infrastructures Uzi Landau said on June 23 that his government was willing to use force to protect its undersea gas finds.
Lawmakers postponed debate about the possible establishment of a fund for the government’s share of any potential revenue from offshore activity, Ali Hamdan, adviser to the parliament speaker, said in a separate interview.
“We don’t want issues related to the overseeing committee or the fund to stall the exploration process,” he said. “These anyway take time and can be voted later on.”
The law is an important step toward tenders for interested companies within the next 12 months, Hamdan said yesterday.
US-based Noble Energy and Israeli companies have announced two offshore gas discoveries in the past 18 months. Noble has said these deposits may hold 24 trillion cubic feet of gas, or twice the size of Britain’s proved gas reserves in 2009, according to the CIA’s World Factbook.
Lebanese Energy Minister Gebran Bassil said on June 17 that his government had advised Noble not to work near Lebanon’s maritime economic zone. He said his country would not allow Israel or a company working on its behalf “to take any amount of our gas that is falling in our zone.”
Israel’s exploration for gas has aggravated divisions within Lebanon, with the Hezbollah-led opposition accusing the government of pro-Western Prime Minister Saad Hariri of neglecting the country’s offshore energy potential.
Hamdan said yesterday revenue from any offshore gas finds could help finance development projects and repay Lebanon’s public debt, which totaled US$52 billion at the end of February, or about 147% of the country’s gross domestic product.
