The race to develop offshore gas reserves in the Eastern Mediterranean basin has begun, and Lebanon is looking to join in. Should Lebanon be successful, it will finally throw off its energy shortage worries for the coming generations.

Hydrocarbon reserves off the coast of Lebanon have been speculated about since the 1960s; however, it has only been in recent years that the public and private sectors have begun to pay more attention. Following two independent geological seismic surveys by Spectrum and Petroleum Geo-Services, which noted the presence of exploitable reserves, in 2010 the US Geological Survey (USGS) extrapolated that the Levant Basin as a whole contained technically recoverable reserves of 1.7 billion barrels of oil and 122 trillion cubic feet of gas. The area, including the promising Leviathan and Tamar gas fields, covers more than 80,000 square kilometers in the Eastern Mediterranean off the coasts of Lebanon, Syria, Cyprus, and Israel. Lebanon's share of the basin is estimated to hold around 600 million barrels of oil and 44,000 billion cubic feet of gas.

In response to its neighbors' exploration and development activities in the basin, the Lebanese government has taken concrete steps to establish a legislative framework to realize the country's energy potential. In August 2010, parliament ratified a draft law that authorizes offshore hydrocarbon exploration and drilling and outlines a framework for future Production Sharing Agreements (PSAs). A regulatory authority and supervisory committee will be created to oversee exploration and production. The outcome of future negotiations will decide whether a sovereign wealth fund will be established. Furthermore, the United Nations (UN) Convention on the Law of the Sea, which Lebanon signed in 1994, requires state parties to specify maritime areas under its sovereignty. In August 2011, the Lebanese parliament passed a draft law, designed by the Public Works, Transport, Energy and Water Committee, demarcating the country's maritime borders.


The Ministry of Energy and Water agreed with French consulting company Beicip-Franlab for the preparation of offshore hydrocarbon exploration tenders. According to the deal, Beicip-Franlab will act in partnership with the Norwegian government and Norway's Petroleum Geo-Services (PGS) to perform more detailed survey work, the results of which were expected in October 2011. The Ministry expects to hold the first licensing round for offshore gas exploration at the end of 2011, with a target date for exploration to start in November 2012.

Lebanon's hydrocarbon prospects have already tweaked the interest of those in the oil and gas industry. In August 2011, UK-based firm Cairn Energy announced that it would partner with Beirut-based Consolidated Constructors Company (CCC) to bid for the oil and gas drilling rights.

Iran has shown interest in sharing its expertise in petrol extraction with Lebanon. In July 2011 the Lebanese energy minister signed a Memorandum of Understanding (MoU) with his Iranian counterpart, which was later approved by the Lebanese cabinet. The MoU includes an energy cooperation agreement worth $50 million.


According to the UN's Convention on the Law of the Sea, Lebanon's unilateral initiatives to determine its maritime borders are insufficient on their own to embark on exploration and drilling activities in the Eastern Mediterranean. What remains to be done is the delimitation of the Lebanese Exclusive Economic Zone (EEZ), which can extend 200 nautical miles (about 370 kilometers) from the country's coast, well beyond the 12 nautical mile territorial waters over which the country has sovereign rights. A halfway point is used when the distance between countries is less than 400 miles.

The determination of the EEZ takes place through the signing of bilateral or multilateral treaties with that country's neighbors. Lebanon and Cyprus signed a bilateral agreement delineating the EEZ between them in 2007, while Beirut has agreed with Damascus in 2010 on the demarcation of the Syro-Lebanese maritime borders. In August 2010, the Lebanese government submitted to the UN a unilateral proposal for the southern boundary of the country's EEZ, which was countered by Israel's submission of its own unilaterally proposed maritime borders in July 2011. Israel is expected to embark on the development of its own Eastern Mediterranean reserves, while Lebanon remains opposed to its southern neighbor's unilateral declaration of its maritime borders. Although the differences in alignment may not amount to much, the possibility of a field being shared between the two states mean that such small differences can amount to a lot in financial terms. As for Cyprus, it also has to deal with the objections of Turkey and the Northern Republic of Turkish Cyprus regarding maritime boundaries, with the latter sending research ships into disputed waters for gas exploration activities in September 2011.


The Eastern Mediterranean basin holds without question one of the most lucrative untapped hydrocarbon reserves close to one of the world's largest consumers—Europe. As Israel has moved fast to develop the fields it has claimed in the Eastern Mediterranean, Beirut must up the pace to secure its own slice of the pie. In doing so, Lebanon will finally have the opportunity to solve its energy shortage issues.