Economic Research | Lebanon This Week | Lebanon This Week 630 | Lebanon's first exploration well yields "negative" results | Lebanon | Byblos Bank

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Byblos Bank

Lebanon This Week 630

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Lebanon's first exploration well yields "negative" results

Total E&P Liban sal, which is the operator of the consortium that won bids for the exploration of oil & gas in Blocks 4 and 9 of Lebanon’s territorial waters, announced that the results of the drilling of Lebanon's first exploration well are "negative". It noted that it completed the drilling of the "Byblos 16/1" exploration well in Block 4 on April 26, and reached a depth of 4,076 meters below the sea level. Italy's Eni International BV and Russian firm JSC Novatek are the two other members of the consortium that was awarded the right to explore the two blocks. Total E&P Liban sal is wholly owned by France's Total S.A.
 
Total S.A. indicated that it found evidence of traces of gas in the exploration well, which confirms the presence of a hydrocarbon system in Lebanon's territorial waters. However, it said that it did not find reservoirs in the Tamar formation, which was the main target of the exploration well located 30 kilometers offshore of Beirut. Despite the "negative" results, it pointed out that the exploration activity has provided valuable information that will be incorporated in future complementary studies about the exploration potential of Lebanon's offshore Exclusive Economic Zone.
 
The drilling for oil & gas started on February 27, 2020 in the first exploratory well in Block 4 in the center of Lebanon's offshore Exclusive Economic Zone. Total S.A selected Tungsten Explorer in an international tender to explore the first well. Tungsten Explorer is managed by the U.S.-based offshore drilling contractor Vantage Drilling Company. In December 2017, the Council of Ministers approved the bid submitted by a consortium of three companies for offshore oil & gas exploration and production in Lebanon.
 
In parallel, the Ministry of Energy extended from the end of April 2020 to June 1, 2020 the deadline for interested companies to participate in the second licensing round for offshore oil & gas exploration in Lebanon, citing the outbreak of the coronavirus pandemic. The ministry’s decision to postpone the deadline was the second such extension, as it previously delayed the deadline from the end of January to the end of April 2020, in response to requests from international oil companies to allow them to complete their administrative, technical and financial preparations. The Council of Ministers approved in April 2019 the launch of the second licensing round for offshore oil & gas exploration and production in Lebanon's territorial waters. Five blocks are open for bidding for the second licensing round, including Block 1 and Block 2, which are located in the north of Lebanon's offshore Exclusive Economic Zone, Block 5 is in the center, and Block 8 and Block 10 are in the south of Lebanon's territorial waters.
 
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