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January 23, 2009

Lebanonwire

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Lebanon eager for a share of gas find off Israel's coast
Mitchell Prothero, Foreign Correspondent, The National

BEIRUT - The discovery of a major natural gas field 90km off the coast of Israel has sparked demands by Lebanese officials for an investigation into whether part of the field falls within Lebanon’s coastal waters.

A joint Israeli-US energy project last week announced that it had found one of the region’s largest gas fields just a few kilometres south of Lebanon’s coastal territory. With both Lebanon and Israel deeply reliant on imported energy, the find could vastly improve Lebanon’s energy situation, as it currently cannot produce enough electricity to meet its needs.

Mohammed Kabbani, a Lebanese MP who chairs the parliament’s energy committee, reported that Lebanon would pursue first an international ruling on where its waters officially begin and possibly a demand to share in the output, should any part of the field be found inside Lebanese waters.

“Noble Energy’s find proves that the [Lebanese] shore is rich in gas and that there is a possibility that we have a common basin, between Lebanon and the occupied Palestinian territories,” Mr Kabbani said.

In a statement issued this week, Mr Kabbani said he feared Israel “can extract mounts of gas from the depths of Lebanon’s territorial waters if there is a common gas basin”.
“If that basin extends to Lebanese waters, then we want to warn this company from infringing on our rights,” Mr Kabbani said, adding the parliamentary committee had requested the government take action.

The energy minister, Alain Tabourian, said Lebanon was in the process of registering with the United Nations the delineation of the country’s exclusive economic zone waters to determine whether the gas falls within it.

A source in Mr Kabbani’s office said beyond the possibility that some of the natural gas belongs to Lebanon, there was a fear that Israel could exploit other finds unfairly.

“The discovery made by Noble Energy shows that this area is full of natural gas and petroleum with a strong possibility to have a common ground between us and Israel,” the source said. “MP Kabbani said it’s a possibility that the Lebanese shores in front of Haifa might be full of natural gas and it’s worth investigating. What we are worried about is that if it turns to be true the enemy would suck it all out even from the Lebanese side as well not only from the common ground.”

The field could have as much as 88 billion cubic metres of natural gas. Located 145km off the coast of Haifa, a city just 25km from the Lebanese border, the field could well fall inside Lebanese waters.

Lebanon recently reconfigured its electric turbines to use cleaner and cheaper natural gas after years of being fuelled by oil. Using oil in such turbines is far more expensive and inefficient than gas.

Efforts by Lebanon to secure a long-term supply of gas from Egypt have frequently stalled over pricing and delivery issues. According to Lebanese economists, the switch to gas might end power rationing across Lebanon. Even in Beirut, electric service is usually limited to 20 hours a day and far less than that outside the capital.

The national utility service, Electricity Du Liban, is one of the most expensive, poorly managed aspects of the Lebanese government. With billions in debt and millions lost to fraud or non-payment each month, the utility has struggled to keep the lights on.

Additional damage from the 2006 war with Israel and the 2007 siege of Nahr el Bared refugee camp has left electrical service often spotty and very expensive.

Delek Drilling, one of the partners in the US-Israeli consortium, denied the discovery was within Lebanon’s territorial waters.

“An examination made with the petroleum commissioner showed that these claims are not correct and the location of the license where Tamar 1 is being drilled was studied carefully and it was found that the entire area of the license was within territorial waters of the state of Israel,” it said in a statement.

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