About The OfD Programme
For the last four decades Norway has been building a successful expertise in managing its hydrocarbon resources. The strong and competent Norwegian institutions as well as the society’s determination to secure national control over its petroleum resources on which the state has a strategic ownership characterize the management of the oil and gas sector in Norway. Consequently, Norway is very well placed to provide Lebanon assistance in building up its nascent oil and gas sector.
Lebanon has entered into a three-year agreement with Norway’s Oil for Development (OfD) Programme, which provides support to Lebanon in its efforts to sustainably manage the prospective offshore petroleum resources in a way that maximizes the positive impact for current and future generations. The main approach of the OfD Programme is to deliver capacity building namely to the LPA and relevant ministries (ministry of finance and ministry of environment particularly) through institutional collaboration.
Lebanon’s OfD Programme is broken down into two phases. Phase 1 started in 2006 and was completed in 2012 with significant achievements in the development of the petroleum sector’s legal framework and in the elaboration of public institutions’ capacities. Phase 2 of the programme is ongoing until 2017 and draws on previous realizations including further developments of the sector’s strategic and legal frameworks; strengthening accountability and transparency; and developing the fields of safety, environment, and revenue management.
Three main objectives define the work of the OfD programme:
Providing the necessary support to help Lebanon establish the strategic, legal and fiscal frameworks governing the petroleum sector.
Sound policies and legislation must be established, and the institutional responsibilities should be allocated and organised in a manner than ensures oversight, minimises conflicts of interest and duplicity of efforts. The OfD programme provides support in developing the capacity necessary to establish the policies and the frameworks to successfully manage the petroleum sector.
Improving the organization, the capacity and the functional development of the LPA and related governmental institutions to enable governmental entities to carry out their assigned roles and responsibilities in accordance with the petroleum sector’s strategic and legal frameworks.
In this regard, authorities must have the capacity and resources to carry out the responsibilities as defined in the legal framework.
Strengthening methods for accountability and transparency in the petroleum sector’s institutional framework and suggesting implementation means.
Parliamentary committees, civil society organizations and the media are crucial in holding the executive bodies accountable. In order to perform a meaningful role, these actors must enjoy independence, critical thinking, access to information and knowledge, competence and capacity. Through dialogues with partner institutions, the OfD programme assists in suggesting methods for improving transparency in the institutional structures and provides means to implement the transparency and accountability measures.
What are the OfD Programme’s Major Achievements?
In 2015, through the OfD programme, the LPA with the support of Norad and the Norwegian Directorates, focused on planning activities to address Lebanon’s direct needs related to the pre-licensing phase.
More specifically, the activities aimed at improving the strategic understanding of the nascent petroleum sector and at increasing knowledge in the technical, geological and economic areas including quality, health, safety and environment (QHSE) related matters. In this regard, the capacities of a broad range of government institutions, including the Ministries of Environment, Public Health, Agriculture, Labour, Public Works and Transport, Interior and Municipalities, Defence, Industry and Finance, along with the Lebanese Petroleum Administration’s capabilities were developed.
Some of the achievements made in 2015 include:
1. Increasing strategic understanding:
Scenario Planning: Lebanon is currently in the pre-licensing phase, and many uncertainties exist around the nascent sector. Given this context, the LPA is putting in place the petroleum sector’s strategic framework through a scenario planning exercise. Through the elaboration of a scenario planning exercise the LPA was able to map out and visualize options related to the management of the prospective sector; and accordingly to design robust strategies that are most likely to stand, while accounting for risks. Additionally, the scenario planning exercise help to increase the preparedness of the LPA in understanding to implications of the oil and gas sector on Lebanon economically, socially and environmentally. In this sense, the scenario planning exercise is one methodology that could help decision makers to better understand a highly volatile environment.
Local Content: Understanding the importance of a sound local content strategy and increasing the strategic understanding of the sector is also achieved through acknowledging the key factors to take into consideration while developing local content strategies.
2. Increasing geological and technical readiness:
The data acquired in 1993 was retrieved, magnetic tapes and associated cartridges that amount 508 linear kilometers were converted into new disks.
This raw data will be subject to modern reprocessing techniques that will provide vital insight into the geology of the studied area.
3. Increasing QHSE competence:
Oil Spill Response and Clean-Up Drill: Relevant stakeholders from various institutions such as civil defense, the Ministry of Defense, and the Ministry of Environment, participated in an oil spill response and clean up drill exercise, which was accompanied with subsequent trainings. The importance of this activity lies in exposing participants to real major risks associated with the petroleum industry. Participants could benefit from a hands-on experience in oil spill contingency planning, response, management and clean up.
Additional outcomes achieved through the OfD programme tackled Health, Safety and Environmental (HSE) auditing, Environmental Impact Assessment (EIA) and Strategic Environmental Assessment (SEA).
4. Understanding State participation and preparing the taxation and audit frameworks
State Participation: Various stakeholders had the possibility to increase their understanding pertinent of different forms of state participation in the upstream petroleum sector.
Taxation and Audit: Various trainings were completed to increase the understanding of key stakeholders, namely the LPA and the Ministry of Finance, on taxation related matters and environmental and financial auditing.
In 2016 the OfD programme supported the development of expertise in relation to strategies relevant to the pre-licensing phase, and addressed further the legal, and health, safety and environmental (HSE) related work. Furthermore, the 2016 activities tapped into increasing the understanding pertinent to the strategic, fiscal, technical and HSE perspectives through the organization of targeted field visits and practical trainings. Finally, this year activities targeted enhancing communication, outreach and transparency.
1. Supporting the development of expertise related to strategies relevant to the pre-licensing phase, and addressing further legal and Health, Safety and Environmental (HSE) related issues:
• The OfD programme assisted in the development of a licensing strategy for Lebanon’s first offshore licensing round while focusing on the methodology required to elaborate the strategy.
• The legal support targeted the review of the draft petroleum register decree, while the HSE support addressed the development of HSE governance related framework and the development of a National Oil Spill Contingency Plan (NOSCP).
2. Increasing the understanding pertinent to the oil and gas upstream sector from strategic, fiscal, technical and HSE perspectives through the organization of targeted field visits and trainings:
• Delegations from the LPA participated in field visits that introduced participants to matters related to supply base, local content and sector development.
• A field visit to Uganda and Ghana was organized to target the learning experience of OfD implementing countries. The purpose was for the LPA delegation to see how a developing country established its petroleum sector and to assess the impact the OfD programme had in countries that received such assistance.
• A learning visit was made to Gassco where the LPA delegation was introduced to the role of the Transmission System Operator responsible for delivering the Norwegian Natural Gas to Europe, and discussion tackled pricing mechanisms and tariffs.
• The Lebanese Ministry of Finance organized a set of workshops to delve into the following topics: the establishment of a Sovereign Wealth Fund, and taxation and auditing procedures.
• Using geological data pertaining to the Lebanese offshore, the LPA team underwent a training in Norway highlighting the steps involved in interpreting 3D data in the aim to better understand prospects and their associated uncertainty. Also, during the visit participants made use of the software Geox and acquired a better understanding related to the resources commercial potential and profitability.
• A team from LPA and the Ministry of Environment (MoE) participated in a week course on Drilling Operations in Norway, including a four-day course at the Stavanger Offshore Technical School (SOTS). The focus was on the technical and safety aspects to account for during drilling operations.
• A team from the LPA and other line ministries participated in a week course in Stavanger on concepts related to risk, emergency preparedness, and response management from the regulators and operators perspectives.
• A course on ISO 14001:2015 Lead Auditor was undertaken in Lebanon where participants from the LPA and other relevant institutions were trained and examined on the needs, requirements, procedures and processes of management systems and auditing.
• The Norwegian Environmental Agency (NEA) facilitated visits to waste handling and treatment facilities in Norway and organized working sessions on oil and gas waste management. The NEA also facilitated a series of workshops in Oslo about environmental monitoring and reporting techniques.
3. Enhancing communication, outreach and transparency:
• LPA communication strategy: A workshop for the LPA took place to review, assess and fine-tune the draft communication strategy that the LPA has elaborated, while drawing on Norway’s experience in reaching out and communicating critical information on the sector.
• Workshops were provided for civil society organizations and media outlets to strengthen the communication process among stakeholders and to sharpen the understanding pertinent to the oil and gas legislative framework.
The Norwegian institutions involved in the OfD programme:
Embassy of Norway
Norwegian Agency for Development Cooperation (NORAD)
Norwegian Petroleum Directorate (NPD)
Petroleum Safety Authority (PSA)
Norwegian Environment Agency (NEA)
Norwegian Coastal Administration (NCA)
Ministry of Petroleum and Energy
Ministry of Climate and Environment
Ministry of Finance
Norwegian Oil Taxation Office (OTO)
The Lebanese institutions involved in the OfD programme:
Lebanese Petroleum Administration (LPA)
Ministry of Energy and Water (MoEW)
Ministry of Finance (MoF)
Ministry of Environment (MoE)