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Lebanon Draws Up Short List For Petroleum Administration

Lebanon Draws Up Short List For Petroleum Administration

A short list for members of Lebanon�s Petroleum Administration has been drawn up by the Ministry of Energy and Water and sent to the cabinet for approval, MEES understands. Three names for each of the six seats, which will be allocated in accordance with the country�s confessional/sectarian constitution, have been selected, but the internal political wrangling within the Lebanese government is expected to further delay the council�s selection.

In January the cabinet approved draft decrees providing for the establishment of the Petroleum Administration, as stipulated by the country�s 2010 hydrocarbon law (MEES , 2/9 January). The council will have an annual rotating chairmanship. Meanwhile, the lack of a functioning council is delaying the launch of Lebanon�s first offshore licensing round, which, when it happens, is expected to attract bids from a number of international players. All technical studies, environmental, and fiscal preparations relating to offshore exploration are completed.

No Compromise On Maritime Dispute

The other offshore issue for Lebanon is the dispute with Israel over the maritime border. MEES soundings indicate that Lebanon will insist on the recognition of the East Mediterranean territory that it has claimed as its offshore exclusive economic zone (EEZ) and that Beirut has not yet accepted a proposal put forward by US envoy Frederick Hoff on a way to resolve the demarcation between Lebanese and Israeli waters. In mid-June, Lebanese media reported that the 854 sq km area disputed by the two countries would be divided, with 530 sq km going to Lebanon and the balance going to Israel. However, MEES has since learned that there is little appetite across Lebanon�s political spectrum to comprise on the EEZ, which Beirut determined in accordance with the UN Convention on the Law of the Sea (UNCLOS), of which it is a signatory.

Furthermore, there are some in Lebanon who argue that Cyprus was mistaken when negotiating a delimitation agreement with Israel that allowed Point 1 (see map, MEES , 18 June) as the tripartite point, and is therefore obliged to correct the error under the terms of the Cypriot-Lebanese delimitation agreement signed in 2007. Lebanon insists on a maritime delimitation border stretching from Ras Naqura to Point 23. According to Article 3 of the Cyprus-Lebanon agreement: �If any of the two parties is engaged in negotiations at the delimitation of its EEZ with another state, the party, before reaching a final agreement with the other state, shall notify and consult the other party, if such delimitation is in connection with coordinates (1) or (6).� In reference to that article, Lebanese politicians are saying that Cyprus should have consulted Lebanon while negotiating the agreement with Israel. However, it must be noted that the Lebanese parliament never ratified the Cyprus-Lebanon agreement.

It remains to be seen whether the lack of a resolution to this issue would prevent Lebanon from launching a bidding round once a Petroleum Administration is established.

© Copyright MEES 2012.

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