Lebanon Businessnews News

Oil and gas
decrees approved
First licensing round can now take place
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Two decrees related to the demarcation of maritime blocks and the contracts for the exploration and production (E&P) of oil and gas have been ratified by the Council of Ministers. Prequalified companies have been awaiting the decrees for more than three years. The number of prequalified international companies in the bidding process is 46, including 12 operators.

The ratification opens the way to the first licensing round for the prequalified companies. The first licensing round was adjourned four times after the Ministry had moved its deadline from November to December 2013, then again to January 10 and April 10, 2014, before it was postponed to an unidentified date.

Rabih Yaghi, oil and gas expert, said: “The ratification is the key and the last hurdle before the cycle of exploration and production begins.”

He said that the Ministry of Energy and Water now has six months to announce and receive proposals as part of the round, if it wishes to follow international standards.

“But because we are in a race against time, the round can be shortened to three months only,” he said.

The Ministry would then require an additional three-month period to evaluate the proposals.

Yaghi said about 95 percent of the conditions agreed upon are according to the E&P contract. The remaining five percent are what will be actually assessed.

The Ministry, along with the Lebanese Petroleum Administration (LPA), will examine the financial and taxation articles of the contract.

“The Ministry should be flexible because we still don’t have an idea whether or not we actually have oil and gas. It can be more stringent in the second or third round when we discover the potential and know the quantities,” he said.
and gas
Reported by Yassmine Alieh
Date Posted: Jan 04, 2017
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