- Lebanon first launched a licensing round for hydrocarbon exploration in its waters in 2013.
- Last month, Total Energies, Eni, and Qatar Energy began drilling in block 9, which falls alongside the newly delineated maritime border.
Lebanon’s energy ministry has said that Total Energies, Eni, and Qatar Energy have made a last-minute bid to drill for oil and gas in Lebanese waters. The consortium made the bid for rights to explore blocks 8 and 10 in Lebanese waters. Lebanon’s energy minister welcomed the move as a positive development, which the government had to regularly extend the deadline for the tender after offering it in April 2019.
Lebanon first launched a licensing round for hydrocarbon exploration in its waters in 2013. But political gridlock, corruption, and infighting have dragged the process out. Those efforts received a boost last October when Lebanon agreed to demarcate its maritime borders with Israel in a deal brokered by the US. Last month, TotalEnergies, Eni, and Qatar Energy began drilling in block 9, which falls alongside the newly delineated maritime border. The area includes the Qana field. As part of the US-backed agreement, Lebanon received rights to the Qana gas field, with Israel enjoying some of the profits of any gas discovered there.
While Qana is viewed as one of the more promising of Lebanon’s offshore fields, the US’s top energy advisor, Amos Hochstein, previously cautioned that it would take a few years to get gas out of the Qana field. Lebanon’s caretaker government will likely welcome any sign of interest in the offshore blocks by energy giants. The Mediterranean country’s economy has collapsed, with GDP down 40 per cent and the Lebanese pound losing 95 per cent of its value against the dollar since 2019. The financial implosion has been widely blamed on Lebanon’s political class, which has refused to create a new government that can begin the reforms needed to unlock international aid.
Western officials have warned Lebanon’s elite against banking on the discovery of energy reserves in place of badly needed reforms. Meanwhile, energy experts have warned that Lebanon is still years, if not decades away from actually monetising any gas discoveries. In April 2020, the same consortium of energy companies halted drilling in Block 4 North, citing a lack of commercially viable gas to develop. The maritime agreement, however, has buoyed Israel’s energy endeavours, with the Israeli government seeing a boost in natural gas royalties in the first half of 2023 after its Karish field became active. Eastern Mediterranean countries have been eager to position themselves as alternate energy suppliers to Europe amid the war in Ukraine.