Oil companies will need 55 days to determine if there are hydrocarbons in offshore Block 4, the head of the Lebanese Petroleum Administration Walid Nasr said Thursday. “The drilling ship will start its gas exploration in December 2019 and it will take around 55 days for the ship to explore the entire of Block 4 to determine if there are hydrocarbons under the sea,” Nasr told The Daily Star.
The Energy and Water Ministry and the LPA have assigned French company Total to send one of its drilling ships to explore for gas in Block 4 off the Lebanese coast.
“If the company discovers hydrocarbons, they will carry out an appraisal to test exactly the quantity and quality. They will also study whether it’s a commercial discovery or not,” Nasr explained.
He added that if it were a commercial discovery, then they would design a development plan and send it to the government for approval.
Nasr said the drilling in Block 4 would not determine the size or value of any offshore gas deposits.
“They [companies] will tell us there is gas but it is not necessary commercial,” he added.
Nasr said based on the results, the government would decide whether to continue drilling in Block 4 or abandon the plan completely if no commercial quantities of gas were found in the block.
In February 2018, Lebanon signed its first offshore oil and gas exploration and production agreements for blocks 4 and 9.
The government had approved two bids by an international consortium of energy companies, comprising France’s Total, Italy’s Eni and Russia’s Novatek.
In January, Nasr was quoted as saying that the media were exaggerating the potential for the oil sector to create “thousands of jobs and bring millions of dollars in revenue to Lebanon,” but nevertheless said he hoped this would be the case.
Nasr’s remarks came during a presentation at the first Lebanese Petroleum Media Forum at Al Maaref University, in which he outlined possible future developments in Lebanon’s petroleum sector and discussed the LPA’s relationship with the media, the state-run National News Agency reported.
Nasr said the LPA wanted to continue to keep the media involved in the progress of the sector.
He said the oil companies would hopefully start gas exploration in Block 9 next year.
On April 4, the Cabinet approved the updated tender protocol for seeking prequalification and obtaining an Exploration and Production Agreement by submitting a licensing round application. It also approved updates to some articles of the model EPA.
According to LPA announcement, “oil and Gas Companies interested in participating in the Second Offshore Licensing Round are invited to form consortiums each composed of at least three individual companies (each such consortium an Applicant), including one individual company that satisfies the pre-qualification criteria applicable to a Right Holder-Operator and no fewer than two other individual companies, each of which satisfies the pre-qualification criteria applicable to a Right Holder – Operator or a Right Holder – Non Operator. Applicants are invited to submit their Licensing Round Applications on the open blocks (blocks 1, 2, 5, 8 and 10) before the 31st of January 2020.”
Energy and Water Minister Nada Boustani told reporters Thursday that Lebanon would go on the region’s oil map once the first exploration well had been drilled.
“Lebanon is cooperating with friendly neighboring countries to conclude understandings and agreements on gas exploration,” she said, adding that “monthly meetings are held between Lebanon and Cyprus in order to reach an agreement in the framework of investment in the joint oil fields between the two countries if they exist.”
The Daily Star