The Minister of Energy and Water has announced that the date to submit bids pertaining to Lebanon’s First Offshore Licensing Round has been extended due to reasons of a political nature. The 6-month bidding round kicked off on 2 May 2013 and was meant to close on 4 November 2013.* During this period, the Government was to finalize the framework and conditions for the exploration and production of hydrocarbons in Lebanon. The presence of a caretaker government with limited powers has inevitably slowed down this process. Notably, the issuance of two key decrees necessary to the bidding has been stalled. These decrees relate to the Delineation of the Offshore Blocks and the model Exploration and Production Agreement. This being said, at this point, much is known about the content of these decrees. Regarding the model EPA, in May this year, a draft model EPA was made available for comment to the companies which had successfully made it through the April 2013 pre-qualification round. An updated draft model EPA was subsequently made available following the conclusion of a workshop held in Beirut in June 2013. Regarding the delineation of the offshore blocks, five blocks (1, 4, 5, 6 and 9) were indicated as likely to be those opened for bidding in Lebanon’s First Offshore Licensing Round, with the possibility of further blocks being added if so decided by the Council of Ministers. As it stands, the closing date of the first bidding round has been announced for 10 December 2013. The Ministry for Energy and Water has, however, highlighted that the December deadline is subject to extension if the Lebanese Government fails to ratify the aforementioned decrees by the end of November 2013. The extension of this deadline will undoubtedly have an impact on the projected timetable as outlined in April this year and the possibility of the signing off of the finalized EPA in February-March 2014 becoming increasingly unlikely.
*We refer to our post of 2 May 2013 for the complete original timeline.
