Page 7 - MEOG Week 41 2022

MEOG POLICY & SECURITY MEOG

Israel and Lebanon agree

maritime border deal

ISRAEL, LEBANON ISRAEL and Lebanon this week agreed a deal efforts to explore the concession, TotalEnergies
that resolves their long-running dispute around said the consortium would seek to drill as far
the demarcation of their shared maritime border from the offending area as possible, but work in
despite technically remaining at war with each the licence remains suspended.
other. Novatek withdrew from the consortium in
Lebanon’s President Michel Aoun announced August with Lebanese Energy Minister Walid
that the talks had come to “a positive end”, call- Fayad saying the firm had cited “economic and
ing the agreement an “historic achievement”. The financial [issues and] political risks” as its rea-
deal sees Beirut regain an 860 square km offshore sons for pulling out%.
area. Alongside the Line 23 deal, a separate agree-
The new border will run, for the most part, ment has been struck between Israel and the
along the Line 23 demarcation, south of the Hof Block 9 consortium that will see royalties from
Line, named after the proposed by US envoy the concession shared.
Frederic Hof in 2012. In June, the Lebanese Petroleum Adminis-
During negotiations, Lebanon pushed hard tration (LPA) extended the deadline for the bid
for the Line 29 to be adopted, though this was round from June 15 until December 15 and the
never likely to be acceptable, particularly as maritime breakthrough may finally bring some
it would have posed major challenges to the success. The original bidding deadline was Janu-
development of the Karish gas field, where Lon- ary 31, 2020 and this was extended first to April
don-listed Energean recently hooked up a float- 30, then June 1 amid the coronavirus (COVID-
ing production storage and offloading (FPSO) 19) pandemic and falling oil and gas prices. The
unit. deadline was then moved to the end of 2021,
Meanwhile, the deal sees Israel retain full with the process relaunched in December 2021
control over Karish, and Lebanon keep owner- with a view to closing this summer.
ship of the Qana deposit. The government said that it had extended the
The majority of Qana is located in waters rec- auction “based on the recommendation of the
ognised as Lebanese by the Hof proposal, and LPA.” It added that the delay was “necessary to
forms part of the Block 9 concession. Not much allow additional companies not currently oper-
is known about Qana. Mona Sukkarieh, energy ating in the Lebanese offshore to prepare their
and political risk consultant at Middle East Stra- files and studies and participate in the second
tegic Perspectives said: “Unlike the rest of the licensing round, thus allowing an acceptable
Lebanese [Exclusive Economic Zone (EEZ)], level of competition among international oil and
the border area isn’t extensively covered by 3D gas companies.”
surveys […] the Qana prospect happens to be Middle East Oil & Gas (MEOG) understands
located in the only spot on the border covered that that no bids were submitted, which should
by 3D surveys. If we extend the coverage, will we perhaps come as little surprise given the coun-
find additional prospects? It’s possible.” try’s ongoing political and economic woes in
Block 9 was awarded to a consortium of addition to the maritime border dispute.
TotalEnergies (40%) and Eni (40%) and Russia’s The second bid round comprises blocks 1, 2,
Novatek (20%) in 2018 along with Block 4 to the 3, 5, 6, 7, 8 and 10. Blocks 1, 8 and 10 were those
north-east. not awarded in the first round between February
The group drilled their first well in Block 4 and November 2017, while blocks 2 and 5 were
in early 2020 but reported that no commercial added to the final cabinet-approved list later,
discovery had been made. With around 7-9% of with blocks 3, 6 and 7 added in late 2021. The
Block 9 overlapping with a triangle of territory Lebanese EEZ is delineated into 10 concession
disputed with Israel, which condemned any areas.™

Week 41 12•October•2022 www. NEWSBASE .com P7