Lebanon: Presidential election dominates local political agenda
Oil and gas-related developments in Lebanon were limited in the past two weeks to the organization of two conferences, one on arbitration and alternative dispute resolution (8-9 May) and the other – more broader and less technical – on Lebanon’s oil and gas wealth (9 May). In addition, the Ministry of Energy and the Petroleum Administration (PA) pursued their lobbying efforts towards pushing for the adoption of the two decrees needed to proceed with the first licensing round [see Lebanon: Tender delayed… pending a broader political consensus? in our April 07, 2014 report].
The PA pursued its exchanges with members of the ministerial committee in charge of studying the two decrees, and an important meeting with the committee was held on May 7. But, as we are approaching the end of President Michel Slaiman’s term (May 25), much of the political debate in the country has been put on hold, as local and regional efforts are directed towards finding a consensus candidate, preferably ahead of the May 25 deadline. Although some are trying to dissociate the two issues and pushing for the adoption of the decrees regardless of electoral considerations, others want to include it as part of the package-deal that would bring a new President.
The Ministry of Energy and the PA are pursuing their efforts, and their communications strategy relies not only on lobbying decision-makers but also the broader audience that is active or working in related fields. Their presence was remarkable in the Lebanon’s oil and gas wealth forum organized on May 9 [see ESA serving as a vehicle of influence in Beirut and Paris in our May 05, 2014 report]. The original program included an intervention by Energy Minister Arthur Nazarian and another one by the current President of the PA Nasser Hoteit. The agenda of the conference was later amended, at their request, to include presentations by other PA members, including Wissam Chbat, Wissam al-Zahabi and Gaby Daaboul. Their excellent interventions were necessary in a highly publicized forum (broadcasted live on TV) in which many of the speakers lacked the necessary knowledge or experience in the sector. They steered the debate and intervened when necessary to rectify certain misconceptions repeated by other speakers, with a view to promote the sector.
Elsewhere in the Eastern Mediterranean…
Greece awards three blocks
The Greek government signed licenses agreements with three different consortiums for the exploration and exploitation of hydrocarbons in three blocks in Ioannina (onshore), Katakolon and the gulf of Patras (offshore) on 14/05, the first such licenses in over 30 years. Ioannina was awarded to Energean and Petra Petroleum, Katakolon to Energean and Trajan Oil, and the third block to a consortium made up of Hellenic Petroleum, Edison and Petroceltic. Another set of concessions is expected to proceed in June 2014.
A first LNG import terminal for Egypt?
Norwegian company Höegh LNG announced on 12/05 that it signed a letter of intent with the Egyptian Natural Gas Holding Company (Egas) for the use of one of its Floating Storage and Regasification Units (FSRU) under construction at Hyundai Heavy Industries as an LNG import terminal in the port of Ain Sokhna, on the Gulf of Suez, for a period of five years. The terminal is expected to become operational by the end of 2014, and will alleviate the country’s energy crisis, a few months into the new President’s term. Currently, Egypt can export LNG but cannot import it in the absence of a terminal. The preliminary agreement must be approved by Egyptian authorities and by each company’s board.
Tamar’s partner to liquefy gas in Egypt?
Israel’s Tamar gas field partners signed a letter of intent with Spain’s Union Fenosa Gas, the main owner of an underutilized LNG plant in Damietta in Egypt, to export up to 2.5 tcf of gas (about a quarter of Tamar) over a period of 15 years for liquefaction in Egypt. The parties hope to reach a final agreement within six months, knowing that the deal will also be subject to the approval of Egyptian and Israeli authorities. The Egyptian Energy Ministry issued a statement on 14/05 linking Egyptian approval to the resolution of a dispute between the plant’s operator and Egyptian authorities being arbitrated by the International Chamber of Commerce. A subsea pipeline will have to be built to transport the gas from the Tamar field to the LNG plant, making it much less vulnerable to sabotage attacks than the pipeline that used to carry Egyptian gas to Israel up until 2012, which was subject to about a dozen attack in just a few months.
Lebanon: The Oil & Gas Report, May 05, 2014
Lebanon: The Oil & Gas Report, April 21, 2014
Lebanon: The Oil & Gas Report, April 07, 2014
Lebanon: The Oil & Gas Report, March 24, 2014
Lebanon: The Oil & Gas Report, March 10, 2014