Lebanon’s oil & gas sector: stoking fears to counter indifference

The oil and gas deal between Speaker Nabih Berri and Foreign Affairs Minister Gebran Bassil in July was initially met with enthusiasm, which gradually subsided as it failed to push for the adoption of the missing decrees. Expectations were misplaced. As we have said on previous occasions, the deal between Berri and Bassil is a positive sign. It is necessary, but on its own, it is not enough. It should be perceived as a preliminary step, laying the ground for a broader, national deal. Once a broad enough consensus is achieved, we can move forward… provided market conditions are favorable.

In the meantime, it’s hard not to notice the evolution in how the sector is being covered or addressed locally. Three years is a long time. In 2013, spurred by a successful pre-qualification round, excitement was building over the country’s oil and gas potential (yet to be confirmed), and the need to prepare the ground for the development of an oil and gas industry. Since then, the debate around the nascent sector turned purely political. Not surprising given the lack of concrete and significant progress since 2013. Despite this, the sector still makes the headlines. But we moved from talking about the sector potential to talking about the series of problems plaguing it, even before we had the chance to confirm this potential. Judging by the many statements from officials working on the sector, or politicians interested in the sector, it appears that virtually the only way to talk about the sector is by stoking fears. For years, we have been accusing Israel of stealing Lebanese gas through Karish, ignoring the fact that Karish has not been developed yet… When this detail became clear, we moved to accusing Israel of planning to steal Lebanese gas in the future. The same with Syria, with whom we also have a disputed area, roughly 900 km2 in size, which we accuse of eyeing Lebanese gas as well. Not even Cyprus, our third and last neighbor, is spared, and is accused of having similar ambitions towards Lebanese gas. If the history of Lebanese-Israeli confrontations, and previous experiences of Israel indeed diverting Lebanese water resources in the South, explain and even justify Lebanese apprehension towards Israel, the same cannot be said about every other country in the region. With an enemy at the southern border, a Syria mired in conflicts at the northern and eastern borders, do we really want to alienate what’s left of the countries in the region?

We are well aware that the real objective of these purely local political maneuvers is to create a strong-enough momentum to encourage the political class to adopt the missing decrees and legislation to move forward with the tender. And you could argue that sometimes the end justifies the means. But it has become clear that this strategy is not going to work. Politicians on the other end of the spectrum – those whose support is needed to move forward – have said that they are aware these are only tactics designed to intimidate them. If results are not there, it might be time to reconsider the strategy. There are other ways to rally support behind efforts to reactivate the oil and gas file.

Stoking fears for an extended period of time without providing proofs or offering solutions has become useless. It is also a sign of failure: In the absence of licensing rounds, exploration, discoveries (etc.) there’s plenty of room for gossip. It appears the only way to exist is through controversies. Let’s hope the much-awaited political breakthrough will have positive ramifications on the sector and remove the need for such maneuvers.

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