Election by Lebanon’s Parliament this week of Gen. Michael Aoun as president removes one of several hurdles to offshore oil and gas licensing by the financially and politically beleaguered country.
Progress toward licensing stalled in 2013 after the government enacted a petroleum law and made other preparations in response to giant gas discoveries in adjacent waters off Israel and Cyprus (OGJ Online, Sept. 12, 2016).
Formation of a fractious government took most of 2013 and part of 2014. The country hadn’t had a president since May that year.
The presidential vacancy precluded action by the cabinet on two decrees needed to allow oil and gas licensing to advance. One would address a marine territorial dispute with Israel. The other would specify terms of exploration and production agreements.
Cabinet members are appointed by the president and prime minister and answer to Parliament. The cabinet has been unable to make substantial decisions.
The importance Aoun, former chief of the Lebanese Army, gives oil and gas licensing remains uncertain.
Because Aoun supports Iran and Hezbollah, the Islamic Republic’s proxy in Lebanon, his election will complicate the territorial dispute with Israel.
Among the country’s earlier licensing preparations was a prequalification round, which drew strong expressions of interest from international operators.
But the round occurred before the collapse in oil prices that began in 2014.
Contact Bob Tippee at [email protected].
