En­ergy firms of­fer bids for blocks four and nine

De­mar­ca­tion dis­pute pos­si­ble source of fewer-than-ex­pected ten­der sub­mis­sions

The Daily Star (Lebanon) - - FRONT PAGE - By Osama Habib

A con­sor­tium of three in­ter­na­tional com­pa­nies made a bid to ex­plore gas in mar­itime blocks four and nine which could usher in a new era for Le­banon if the of­fers are ap­proved by Cab­i­net.

The an­nounce­ment by En­ergy and Wa­ter Min­is­ter Ce­sar Abi Khalil came in a state­ment to the press Fri­day, af­ter the min­is­ter told The Daily Star Thurs­day that the Le­banese Petroleum Ad­min­is­tra­tion has re­ceived two bids to ex­plore for gas in two of the five blocks on of­fer.

The com­pa­nies which made the of­fers were To­tal SA (France), ENI In­ter­na­tional B.V. (Italy) and JSC NOVATEK (Rus­sia).

“The LPA sub­mit­ted Fri­day to the En­ergy and Wa­ter Min­is­ter a re­port about the of­fers made in the first li­cens­ing round which was con­cluded Thurs­day,” Abi Khalil said in a state­ment.

He added that To­tal SA, ENI In­ter­na­tional B.V. and JSC NOVATEK have re­quested a li­cense to op­er­ate blocks four and nine off the Le­banese coast.

“In view of the of­fers, we can say that the re­sults of the first li­cens­ing round was very pos­i­tive and Le­banon was able to draw in­ter­na­tional com­pa­nies with wide ex­pe­ri­ence in ex­plo­ration and de­vel­op­ment of gas fields and can ac­cess the in­ter­na­tional mar­kets for ex­port,” the min­is­ter said.

He added that Is­rael has post­poned its li­cens­ing round three times with­out get­ting any re­sults.

Abi Khalil stressed that LPA has sent a pre­lim­i­nary re­port and it will send a sec­ond one, which con­tains more de­tails about the of­fers made by the com­pa­nies.

The min­is­ter will send the fi­nal re­port about the bid­ding to the Cab­i­net to study it care­fully be­fore ap­prov­ing it.

“Upon the re­sults of the eval­u­a­tion process, the Le­banese Petroleum Ad­min­is­tra­tion will sub­mit to the en­ergy and wa­ter min­is­ter an eval­u­a­tion re­port no later than of Nov. 13, 2017. Ac­cord­ingly, the min­is­ter will sub­mit the re­sults of the full eval­u­a­tion process to Cab­i­net to make the fi­nal de­ci­sion with re­spect to award­ing blocks and sign­ing the Ex­plo­ration and Pro­duc­tion Agree­ment(s) with the win­ning con­sor­tium(s). The EPA fol­lows a pre­set model is­sued in An­nex 2 of De­cree 43/2017,” a state­ment by LPA said.

The En­ergy Min­istry said ear­lier that 51 in­ter­na­tional com­pa­nies were pre­qual­i­fied to bid for li­censes to ex­plore gas off the Le­banese coast.

But there was no ex­pla­na­tion as to why the rest of these firms did not make of­fi­cial of­fers to op­er­ate and de­velop the po­ten­tial off­shore gas re­serves.

A MP told The Daily Star that the of­fers made by three lead­ing in­ter­na­tional com­pa­nies are a ma­jor step that could add Le­banon to the in­ter­na­tional oil pro­duc­ing club.

“We should not ques­tion why other firms did not bid for the blocks. Cyprus had a very dif­fi­cult time to en­cour­age many com­pa­nies to ex­plore for gas,” he added.

The law­maker ar­gued that blocks nine and four do not fall within the dis­puted zone with Is­rael.

“I don’t think the in­ter­na­tional oil com­pa­nies are too keen to Is­raeli ter­ri­to­rial waters for the time be­ing,” he ex­plained.

Is­rael claims that a stretch of 870 kilo­me­ters of blocks eight, nine and 10 be­long to it.

But Le­banon has in­sisted re­peat­edly that the en­tire three blocks near the Is­raeli ter­ri­to­rial waters are part of Le­banese waters.

Le­banon has pro­posed the de­mar­ca­tion of the dis­puted zone by the United Na­tions, a re­quest re­jected by Is­rael.

“The ul­ti­mate goal of the ex­plo­ration phase is be to strike a com­mer­cial dis­cov­ery, hence the awarded con­sor­tium(s) is (are) com­mit­ted to im­ple­ment an ex­plo­ration pro­gram based on the petroleum in­dus­try high­est stan­dards and prac­tices,” the LPA said.

Abi Khalil told the Daily Star Thurs­day that the ac­tual ex­trac­tion of gas would take be­tween five and six years.

ex­tract gas near the

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