(BEIRUT, LEBANON) — The decision to delay gas-licensing for another six months has raised concern that Lebanon may miss a chance to tap potential gas weather in the Mediterranean sea in the near future.
The London-based Economist Intelligence Unit said that delays reflected the government’s failure to ratify two decrees that would outline terms of exploration and production.
It also said the committee in charge of reviewing decrees was not meeting regularly and was struggling to find consensus.
The EIU went on to caution Lebanon that these delays will erode confidence in the Lebanese government’s abilities to maintain international oil interests.
It pointed out that major international oil companies had little clarity on contractual terms for the country’s offshore reserves, as well as on the number of blocks that would be auctioned.
The EIU says that Lebanon was lagging behind other neighboring countries in the Levant Basin in this process, and Israel was already reaching the phase of monetizing its gas reserves.
It added that Lebanon could have started the drilling work by late next year if the government had approved the decrees and if authorities had completed the auction by mid-August of this year.
The EIU warned that these delays meant the economy would not benefit from hydrocarbon proceeds any time soon, especially since there was no certainty that the country was sitting on commercially viable oil and gas deposits.