Lebanon moves closer to a First Offshore Licensing Round

Lebanon has announced on 18 April 2013 the list of 46 companies pre-qualified to take part in the country's long-awaited First Offshore Licensing Round.

Companies that are pre-qualified to act as an operator are Anadarko; Chevron; Eni; ExxonMobil; Inpex; Maersk; Petrobras; Petronas; Repsol; Shell; Statoil; and Total.

Companies that are pre-qualified to act as a non-operator are: Cairn Energy; Cairn India; CC Energy; Crescent Petroleum; Crescent/Apex; Dana Gas; Dana Petroleum; Dragon Oil; Edison International; GDF Suez; Genel Energy; GeoPark/Petroleb; Heritage Oil; INA; Japan Petroleum Exploration Co; JX Nippon; KOGAS; Korea National Oil Company; Kuwait Foreign Petroleum Exploration Company; LUKOIL; Marathon Oil; MDC Oil and Gas Holding Company; Mitsui E&P Middle East; MOL; OAO Novatek & GPB Global Resources; OMV; ONGC; Petroceltic; PTT; Rosneft; Santos; SOCO; Suncor; and TPAO.

Although Lebanon's current government is currently in a state of care-taker after the resignation of Prime Minister Mikati, it is understood that the Ministry of Energy and Water (MoEW) and the Petroleum Administration (PA) are relying on decisions made by the Lebanon Council of Ministers prior to the aforementioned resignation in order to move ahead with inviting pre-qualified companies to participate in Lebanon's First Offshore Licensing Round that will be open on 2 May 2013.

The Licensing Round will be launched during an event organised by the MoEW and the PA on 30 April 2013 at the Phoenicia Intercontinental Hotel in Beirut, Lebanon. It is anticipated that the MoEW will present during the event its Licensing Strategy including a description of the offshore blocks, the tender protocol and the regulatory framework. It is also expected that the event might include an insight into some of the terms of the Model Exploration and Production Agreement, which is still a work in progress. The PA is also planning to publish a booklet during the event featuring all the pre-qualified companies. The latter are being requested to provide the PA a description (up to 400 words) of their company highlighting its relevant qualifications and interest in working in Lebanon. Companies must provide to the PA the aforementioned materials and the names of their representatives by 24 April 2013.

Although a number of decrees still need to be issued by the Lebanese Council of Ministers (yet to be formed) to set the comprehensive regulatory framework for the First Offshore Licensing Round, it appears that the MoEW and the PA are confident that this licensing round can be launched successfully with the hope that the new Council of Ministers will be formed within a few months (which would be considered relatively quick in the standards of Lebanese politics). Failure to form the new Council of Ministers during the coming two to three months might negatively impact the pre-qualified companies' ability to bid for the First Offshore Licensing Round in a timely manner.