An­other red flag

We must not squan­der the chance to build a clean oil and gas sec­tor

Executive Magazine - - Leaders -

On Fri­day, July 1, two men walked to­ward a mi­cro­phone to speak as rep­re­sen­ta­tives of their re­spec­tive po­lit­i­cal par­ties, but not in their of­fi­cial ca­pac­ity as min­is­ters. Fol­low­ing a closed-door meet­ing, they de­clared the end to a three-year feud. A bi­lat­eral deal had been reached con­cern­ing the na­tion’s po­ten­tial hy­dro­car­bon re­sources. Le­banon was set to fi­nally close its first off­shore oil and gas li­cens­ing round which is a de­ci­sion cab­i­net was sup­posed to make. Af­ter read­ing a state­ment that any think­ing per­son will tell you means ab­so­lutely noth­ing (un­less it’s laced with coded lan­guage only true in­sid­ers can de­ci­pher), a re­porter’s re­quest for de­tails was re­buffed with a prom­ise that con­sul­ta­tions with the prime min­is­ter would be held. With that, the two men left. A fait acom­pli, in lo­cal po­lit­i­cal par­lance. In all fair­ness, it was prob­a­bly a stunt and the deal looks dead (see cover story page 14), but ei­ther way, the whole thing stinks.

First and fore­most, the deal shouldn’t have been dis­cussed in pri­vate by two po­lit­i­cal par­ties. By law, it is cab­i­net’s job to set the coun­try’s oil and gas pol­icy. While the “oil deal” meet­ing is far more egre­gious, it is sadly the rule for how this sec­tor has been of­fi­cially dis­cussed in the past two years. Prime Min­is­ter Tam­mam Salam cre­ated a min­is­te­rial com­mit­tee to de­bate oil and gas back in early 2014. The com­mit­tee met only a few times. In­stead of us­ing the of­fi­cial venue on of­fer, each in­di­vid­ual min­is­ter had the Le­banese Petroleum Ad­min­is­tra­tion (LPA) come for a one-on-one visit to ex­plain the sec­tor and the LPA’s vi­sion for an oil and gas strat­egy. Oil and gas is a com­pli­cated and tech­ni­cal topic. Imag­ine if the LPA gave the min­is­te­rial com­mit­tee 15 or 20 work­shops on the sub­ject, first bring­ing every­one up to speed on the ba­sics of how the in­dus­try works and then out­lin­ing dif­fer­ent op­tions for a Le­banese oil and gas strat­egy while weigh­ing the pros and cons of var­i­ous choices. We would have more in­formed min­is­ters. The “class­room” en­vi­ron­ment would help those from ri­val camps see how the other side thinks, which could help avoid fu­ture years-long de­lays at im­por­tant junc­tures as cab­i­net de-

There is no le­git­i­mate rea­son for talk on this sub­ject to be se­cret. All oil and gas dis­cus­sions must be pub­lic.

cides on ev­ery step for­ward in this sec­tor. If these work­shops were tele­vised (and made per­ma­nently avail­able on YouTube), in­ter­ested cit­i­zens and civil so­ci­ety groups would to­day be more equipped to over­see this sec­tor as it is born and hope­fully grows. Mov­ing for­ward, this must be our model. There is no le­git­i­mate rea­son for talk on this sub­ject to be se­cret. All oil and gas dis­cus­sions must be pub­lic.

Equally of­fen­sive was the re­ac­tion to the deal. Where was civil so­ci­ety? The si­lence is shame­ful. Civil so­ci­ety must protest ques­tion­able pro­ceed­ings like these. The method of protest is ir­rel­e­vant. At least do some­thing – a state­ment, any­thing. Ex­cept tire burn­ing. Please.

Weed­ing cor­rup­tion out of the sys­tem is a long-term goal that will take time and ef­fort. It has been grow­ing for decades, and its roots have a stran­gle hold on nearly ev­ery state in­sti­tu­tion. The nascent oil and gas sec­tor, how­ever, is an op­por­tu­nity. Three years ago Ex­ec­u­tive asked how mil­lions of dol­lars in sur­vey data rev­enue are be­ing man­aged. We were an­swered with a defama­tion law­suit (which we won this month, for the record). Two years ago, we noted a flaw in the pre-qual­i­fi­ca­tion process that al­lowed Mo­hamad Chouqair, head of the Beirut cham­ber of com­merce, and Mah­moud Si­dani, chair­man of Unigaz, to par­tic­i­pate in the first li­cens­ing round. Their com­pany is reg­is­tered in Hong Kong and they pay a yearly fee to ob­scure their own­er­ship of it (Panama Pa­pers, any­one?). Per­haps not sur­pris­ingly, the dis­clo­sure changed noth­ing. It is time we all wake up. This sec­tor is be­ing built from scratch and we have the chance to get some­thing right. We must not squan­der it.

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