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About LPA

Oil For Development Programme (OfD)

About

Lebanon has entered into an agreement with Norway that allows it to benefit from the Norwegian Oil for Development (OfD) Programme which supports 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 Lebanese ministries through institutional collaboration with corresponding counterparts in Norway. 

 

Lebanon’s OfD Programme is divided into three phases:

  • Phase 1 started in 2006 and was completed in 2012 with significant achievements in the development of the petroleum sector’s legal framework.
  • Phase 2 started in 2014 and ended in April 2018 drawing on previous realizations including further developments of the sector’s strategic and legal frameworks; strengthening accountability and transparency; and enhancing capacities in the fields of resource management, safety, environment and revenue management.
  • Phase 3 started in 2018, is ongoing until 2021 and is focused on supporting the operational phase that was initiated in the Lebanese Waters after the first block awards in 2018. The focus is given to providing the needed technical support for the development of strategies, plans, studies, guidelines and procedures tailored to the current phase of the sector.
 

Three main objectives define the OfD programme’s scope of work:

  • Supporting the establishment of the strategic, legal and fiscal frameworks governing the petroleum sector, and ensuring that institutional responsibilities are allocated and organised in a manner than safeguards oversight and minimises conflicts of interest and duplicity of efforts. 
  • 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
  • Strengthening methods for accountability and transparency in the petroleum sector’s institutional framework. 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 competence.
 

Programme Details

Name: Oil for Development (OfD) Programme
Duration: Phase 1 (2006 – 2012). Phase 2 (2015 – 2017). Phase 3 (2018 – 2021).
Funding: Grant between Norad and the Ministry of Foreign Affairs and Emigrants of the Republic of Lebanon,
Programme Coordinator from the Lebanese side: Lebanese Petroleum Administration

Partner Institutions

Norwegian institutions
Norwegian Agency for Development Cooperation (NORAD)
Ministry of Petroleum and Energy
Ministry of Climate and Environment
Ministry of Finance
Norwegian Petroleum Directorate (NPD)
Petroleum Safety Authority (PSA)
Norwegian Environment Agency (NEA)
Norwegian Coastal Administration (NCA)
Norwegian Oil Taxation Office (OTO)

Lebanese institutions
Ministry of Energy and Water (MoEW)
Ministry of Finance (MoF)
Ministry of Environment (MoE)
Lebanese Petroleum Administration (LPA)
Other beneficiaries such as: Ministry of Defense – Army, Ministry of interior and Municipalities – Civil Defense, Ministry of Labor, Ministry of Public Health, Ministry of Industry, Ministry of Public Work and Transport, Council of Minister – Disaster Response Unit.

Main Achievements

2015

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.

Main achievements made in 2015 include:...

  1. Increasing strategic understanding:
    • Scenario Planning: During the pre-licensing phase, many uncertainties exist around the nascent sector. Given this context, the LPA put in place a scenario planning exercise to map out 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 helped to increase the preparedness of the LPA in understanding to implications of the oil and gas sector on Lebanon economically, socially and environmentally.
      Local Content: Understanding the importance of a sound local content strategy was also achieved through acknowledging key factors to account for while developing such strategies.
  2. Increasing geological and technical readiness:
    • Data reprocessing: Old seismic data acquired in 1993 was retrieved. Magnetic tapes and associated cartridges that amount 508 linear Km 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 and clean-up drill exercise: Stakeholders participated from hands-on experience 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.
    • Other HSE related activities:Activities tackling Health, Safety and Environmental (HSE) auditing, Environmental Impact Assessment (EIA) and Strategic Environmental Assessment (SEA) were achieved.
  4. Understanding State participation and preparing the taxation and audit frameworks:
    • State Participation:Stakeholders increased their understanding pertinent to 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.

2016

In 2016, the OfD programme supported the development of expertise in relation to strategies relevant to the pre-licensing phase, and further addressed the development of the legal, and health, safety and environmental (HSE) framework. This year’s 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:
    • Licensing Strategy: 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.
    • Legal support and HSE governance: 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:
    • Workshops:
      • The Lebanese Ministry of Finance organized a series of workshops to delve into the establishment of a Sovereign Wealth Fund, and taxation and auditing procedures.
      • The NEA also facilitated a series of workshops in Oslo about environmental monitoring and reporting techniques.
    • Enhancing geological understanding: Using the Lebanese offshore geological data, 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.
    • Technical field visits:
      • Delegations from the LPA participated in field visits that introduced participants to matters related to supply base, local content and sector development.
      • A visit to Uganda and Ghana was organized to share the learning experience of OfD implementing countries.
      • 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.
    • Courses undertaken:Several course were undertaken in the objective to build the LPA’s technical capacity as well as the capacity of other line ministries involved in the sector.
      • A course was given on Drilling Operations in Norway where focus was given to the technical and safety aspects during drilling operations.
      • Another course was provided to explore 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 where participants were trained and examined on the needs, requirements, procedures and processes of management systems and auditing.
  3. Enhancing communication, outreach and transparency:
    • Workshops:
      • 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.

2017

This year was decisive for the offshore oil and gas sector in Lebanon as the the first offshore licensing round was relaunched, five blocks were open for bidding and a second pre-qualification round was carried out. At the end of 2017, two blocks have been awarded through the successful conclusion of the first licensing round and the signature of the exclusive exploration and production agreements. Given this context, the OfD Programme assisted in the preparation phase and activities achieved the results below:...

  1. Complementing the legal framework for monitoring and supervising petroleum activities and developing specific guidelines tailored to the upcoming exploration phase:
    • The decree related to Registration, Mortgaging and Transfer of Petroleum Rights.
    • The decree related to the disclosure of contracts.
    • The decree related to safety zones.
  2. Increasing the overall understanding of the oil and gas upstream sector and its effects on the Lebanese economy to inform decision making and manage expectations:
    • Drafting high-level scenarios and conducting a ripple effects study.
    • Completing decrees with the Ministry of Finance related to the Petroleum Tax Law.
    • Acquiring Petrel software and performing geological studies and assessments of the Lebanese hydrocarbon potential.
    • Drafting resource management guidelines
    • Enhancing capacity in HSE and HSE governance.
  3. Organising visits and events with stakeholders such as the Parliament, the media and civil society organisations.
    • A study trip to Norway for selected Members of Parliament working on Oil and Gas related issues took place with the purpose of sharpening the understanding pertinent to the petroleum system while drawing on the Norwegian experience in resource, revenue and environmental management.
    • A workshop was organised for civil society organisations so to improve the public debate around the nascent petroleum sector in Lebanon in light of the ongoing first licensing round.

2018

In June 2018, The Norwegian Agency for Development Cooperation (Norad) and the Lebanese Ministry of Foreign Affairs (MoFA) entered into a third phase of agreement regarding the Oil for Development (OfD) programme. During this period, Lebanon has continued to follow up on the exploration activities undertaken by the right holders in blocks 4 and 9 with the aim of conducting first exploratory drilling in 2019. In parallel, and implementing the decision of the Council of Ministers, the LPA started carrying out preparatory activities for the second offshore licensing round launched in 2019. These operational developments reflected in the activities achieved under the OfD Programme which covered the following:...

  1. Preparing for the second licensing round:
    • The LPA worked with the support of the Norwegian Petroleum Directorate (NPD) and the Ministry of Energy and Petroleum in Norway on developing a comprehensive study about the various state equity participation options to consider for the second licensing round in Lebanon.
  2. Preparing exploration related guidelines:
    • As part of drilling activities preparations, the LPA worked on drafting drilling guidelines with the support of the OfD Programme through the Petroleum Safety Authority (PSA).
    • The Ministry of Environment with the participation of the LPA benefitted from the support of the Norwegian Environmental Agency (NEA) in the preparations of draft versions of the Environmental Impact Assessment (EIA) guidelines for the reconnaissance and exploration phase.
  3. Strengthening the preparedness of the Lebanese institutions to carry out their duties during the exploration phase through:
    • Several trainings and courses have been conducted to cover topics of relevance to the operational phase such as: well control, drilling and well integrity; advanced core and log integration and pore pressure gradient estimation; and EIA review training for MoE staff.
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