Disir
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- Sep 30, 2011
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Lebanon, a country that unlike many of its neighbors has faced high energy prices for a generation, wants to become a natural gas exporter by the end of this decade.
To realize its ambition, the government will need to take on the new role of managing foreign oil and gas companies that are set to compete in its first and long-delayed offshore licensing round.
Speaking last week on the Houston-leg of a government roadshow, Lebanon’s Minister of Energy and Water Cesar Abi Khalil said he is pushing companies to turn in their bids by 15 September so contracts can be awarded as soon as November.
“In this licensing round we have managed to attract 51 of the biggest companies in the world to pre-qualify and express their interest,” he said, adding, “This is five times the total number of companies that have participated in all the licensing rounds that have occurred in our part of the world.”
The interest level speaks to the potential of the blocks on offer, the minister said. On auction are five of the country’s 10 offshore areas where potential gas-rich reservoirs lie untapped. The country is using the production-sharing agreement model to launch its domestic energy sector and will place revenue in a sovereign wealth fund that will serve as an investment vehicle.
The Lebanese government’s short-term aim is to use newly produced gas for electricity generation so it can do away with expensive fuel-oil burning power plants. Longer-term goals include using gas to bolster domestic manufacturing and transport sectors.
Meeting domestic demand might not be such a tall order. With a population of 5.8 million people, Khalil said the output equivalent of two offshore wells would quench Lebanon’s entire gas need, which is not expected to exceed an annual consumption rate of 0.5 Tcf by 2030.
In terms of exporting the product, Lebanon will have several possibilities. They include tapping into the Arab Gas Pipeline, using a proposed Syrian pipeline that would terminate in Turkey, laying a new subsea pipeline to Cyprus, or a floating liquefied natural gas facility. “There are too many options,” Khalil quipped.
JPT - Lebanon Eager To Award First Offshore Contracts, Become Gas Exporter
I have been reading about this the last few days. This is probably the longest article (in English) I have come across.
