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US ambassador hands letter to Mikati on regional energy market

U.S. Ambassador to Lebanon Dorothy Shea on Friday met with Prime Minister Najib Miqati and conveyed to him “an official written communication from the U.S. Department of the Treasury” that she said “answers to some of the concerns that the (Lebanese) authorities have” regarding regional energy deals.

”They wanted to make sure that in pursuing the regional energy deals that the United States has been helping to facilitate between Lebanon, Egypt and Jordan, that there will be no concerns with U.S. sanctions legislation,” Shea said after the talks.

“This letter that was delivered represents forward momentum and important milestone as we continue to make progress to bring safer, cleaner, more reliable energy solutions to help address the energy crisis that the Lebanese people have been experiencing,” the ambassador added.

In late December, Lebanon’s energy minister launched two projects in the country’s north to facilitate the flow of natural gas from Egypt. The move aims to improve electricity production and expand the country’s tanks to increase oil reserves.

The revival of the Arab Gas Pipeline to deliver Egyptian gas to Lebanon comes as the small country is reeling from a crippling electricity crisis. The pipeline has been out of service in Lebanon since before Syria’s 10-year conflict began in 2011.

Minister Walid Fayad said Egypt’s Technical Gas Services would begin renovation work on the pipeline inside Lebanon and work should be done in a little more than two months.

Egypt has agreed to supply Lebanon with natural gas to its power plants through Jordan and Syria. Syrian experts have finished work inside the war-torn country.

The Syrian government is under U.S. and Western sanctions for its role in the war. Despite the sanctions, the U.S. has supported the resumption of natural gas flow from Egypt to Lebanon via Syria.

Fayyad told The Associated Press during a tour of an oil facility that U.S. officials who have visited Lebanon said the contract to bring gas from Egypt will not be targeted by sanctions because “no cash is going from any side to Syria.”

He added that Egyptian officials are in contact with the Americans to make sure that the contract does not violate the sanctions.

Fayyad said about 650 million cubic meters (22.95 billion cubic feet) of gas will be brought to Lebanon through the pipeline annually to the Deir Ammar power station in the north. He said the amount will lead to the production of 450 megawatts of electricity adding three to four hours of electricity supplies a day.

He said the cost will be about 7.5 to 8 cents per kilowatt hour, “which is cheaper than any production costs we have.”

In 2019, Lebanon signed a deal with Russia’s largest oil company, Rosneft, to upgrade and operate storage installations in Tripoli. The deal made Rosneft manage storage operations.

Fayad said Roseneft will rehabilitate and build tanks that can fit 150,000 cubic meters (5.29 million cubic feet) of strategic storage and at a later stage it can reach 250,000 cubic meters (8.82 million cubic feet). Eventually it will fit 400,000 cubic meters (14.1 million cubic feet).

He said the works will begin with the renovation of three tanks and building three new ones as well adding that the project is expected to take about 18 months.

Source: Naharnet.com

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