Minister Nada Boustani for a Regional Cooperation and a Transparent Sector
24 July, 2019


Lebanon seeks oil, gas cooperation with countries in region:

Lebanese Energy and Water Minister Nada Boustani said Tuesday that Lebanon is negotiating with Cyprus and Egypt on the potential of cooperation in the oil and gas sector, local media reported.

"We aim at reaching agreements with countries in the region in a way that will yield benefits for everyone," Boustani was quoted as saying by Elnashra, an online independent newspaper.

Boustani said that Lebanon is discussing with Cyprus the potential cooperation by extracting oil and gas in common oil fields between the two countries.

“In particular, Lebanon is actively engaging with Cyprus on drafting a framework unitization agreement. The two countries are positive about discussing further the development of common infrastructure within a tripartite framework including Greece. Discussions are continuously maintained with Egypt, which is connected to Lebanon through the Arab Gas Pipeline. Lebanon remains open and committed to extend further the regional talks that promote beneficial cooperation for the involved parties,” Boustani said.

 

She added that Lebanon is also in negotiations with Egypt to explore cooperation opportunities between the two countries mainly by reactivating the Arab Gas Pipeline.

Arab Gas Pipeline (AGP) is a trans-regional gas export pipeline built to carry natural gas from Egypt to Jordan, Syria and Lebanon.


Boustani announced earlier this year the launch of Lebanon's second licensing round for offshore oil and gas exploration in five blocks; note that in February 2018, Lebanon signed its first offshore oil and gas exploration and production contracts for two energy blocks with a consortium of France's Total, Italy's Eni and Russia's Novatek.

Laury Haytayan, MENA director at Natural Resource Governance Institute (NRGI) and MENA Oil & Gas expert stressed that this is what is exactly needed at this stage for Lebanon. The government needs to forge deals and strengthen collaboration with the regional countries like Egypt and Cyprus.

Having a unitization agreement with Cyprus is very vital for Lebanon especially that we are offering in the 2nd licensing round among others block 5 which is the block with common borders with Cyprus; in this stage the agreement with Cyprus is a must in case the companies will discover any common reservoirs and they need to deal with it.

NB: Unitization is the joint, coordinated operation of a petroleum reservoir by all the different owners of the reservoir; it is the best mechanism for assuring the maximum recovery of hydrocarbons in an efficient manner.


About Egypt, Haytayan added that it’s becoming the hub in the region; and therefore a bilateral collaboration with Egypt is recommended and it can be feasible through the Arab Gas Pipeline but that option will require Lebanon to cooperate or negotiate with Syria. That might mean that Lebanon should offer a package deal to Syria that will include the transit and the delimitation of the maritime borders between the two countries. Another option is to go to Egypt through Cyprus,  that would require tripartite strategic cooperation.

 

 

Into a transparent sector:

Energy Minister Nada Boustani pledged to develop an oil and gas sector that operates with total transparency – according to the official twitter account she added: “the government and the Energy and Water Ministry is committed to following up on the development of Lebanon’s petrol sector with transparency”. Meanwhile works are in process for a solid application for EITI standard “Lebanon is showcasing a unique path of transparency in its nascent oil and gas sector,” the minister said but this step is still incomplete because it lacks the formation of the MSG which is the key for full EITI implementation.

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