Recently, Mr. Gebran Bassil, Minister of Energy and Water in the caretaker government of Lebanon, announced that Israel "has discovered a new gas field about 4km from the Lebanese border, which means that Israel is now able to reach Lebanese petroleum," something that Bassil deemed to be a grave threat. Bassil explained that when Israel had previously made discoveries in the Tamar and Leviathan fields, 38 and 42 km from the Lebanese border respectively, some would say these discoveries carry the danger of Israel tapping into Lebanese oil or gas, but the response was that this was technically not possible. However, Bassil added, Karish, Israel's new field, is only 4 km away from Lebanon's border, which, at least in theory, means that Israel can syphon off Lebanese petroleum from a distance. The minister explained the risks arising from the presence of the new field near Lebanese waters, and said, "The first possibility involves horizontal drilling. The figure attained worldwide so far is a maximum of 10 km, which means that Israel can tap into the confirmed reservoir in Lebanon and in Block 9, which is 6 km on one side or 9 km on another side away from Israel." Bassil added, "In case of vertical drilling and overlap between the Israeli and Lebanese fields, Lebanese oil and gas could be affected and could flow towards Israel. But this has not been established." The discovery of gas fields in Israeli waters, and the prospects for discoveries in Lebanese waters in the future, is a development with serious implications, especially between two countries that remain in a state of war. There are challenges arising from horizontal drilling, which allows drilling a well from an offshore platform and then extending pipes for kilometers on either side, and enables siphoning off petroleum from the same reservoir through the political borders of two countries. Horizontal drilling is a relatively recent technique, and like other technologies, it is being continuously developed given the results it has achieved. Naturally, the drilling distance horizontal drilling can achieve is expanding, and currently can reach 10 km or more. Further distances can be expected in the future. So how can one party be deterred from encroaching on the resources of another? The first step must be to initiate exploration, development, and production operations. Indeed, without signing agreements with international companies to begin exploration and drilling, the other side will be able to engage in exploration and drilling in its own areas without technically breaking any laws. To be sure, it is the right of every state to drill in its waters, no matter how close to the borders of a neighboring country this may be. The responsibility is therefore on the latter to preserve its resources, by taking necessary steps to begin exploration all the way to production. It is very possible for a party to drill and produce in its own areas through horizontal drilling, without siphoning off petroleum from a second party. But the problem here is that drilling by one side from a reservoir located over the borders of two countries will extract petroleum from the other party, even through vertical drilling, and also reduce pressure in the shared reservoir and subsequently the other party's productive capacity. Depending on the flow of petroleum, drilling by one party can lead to petroleum flowing to the other party. The Karish field was discovered by the US firm Nobel Energy along with Israel's Delek Group at a depth of 15,683 feet below sea level. It is estimated to hold around 1.8 trillion cubic feet of gas, and is located near Lebanon's Block 9. Karish is the seventh discovery in a row by the two companies, which have so far discovered a total of 38 tcf in gas reserves in Israeli waters. Production began from Tamar last March, four years after the field was discovered. It is worth noting that international oil companies have so far refrained from operating in Israeli waters, fearing the consequences of an Arab boycott. This was supposed to give Lebanon an edge to move forward and sign agreements with international companies to operate in its waters. However, Lebanon continues to drown in chronic political disputes, squandering this opportunity. Meanwhile, Israel has already begun production from its northern waters, while Lebanon is still waiting for the caretaker government to convene an extraordinary meeting to complete the legal procedures for signing contracts with international companies. What are the possible outlooks for the future? The experience of friendly neighboring countries underscores the need to ‘unify' exploration, development, and production operations, and to monitor these by a tripartite assemblage of both sides plus a neutral third party expert to accurately assess the geology of the joint field and the production volume available to each side. This information would then be reviewed on an annual basis, and verification is made to ensure that each party is receiving its dues in accordance with the geological configuration of the reservoir in each respective territory. The experience of Norway and Britain in ‘unifying' operations in a number of their fields is well known and documented. There are neighboring and even sisterly countries that have joint fields, where reservoirs extend through geographical borders, but without there being agreements to unify operations in the fields. This has often led to armed conflict, as was the case with Iraq and Kuwait, or Iraq and Iran. Of course, the situation is completely different between Lebanon and Israel. These two countries remain in a state of war, and have disputes over the maritime boundaries. Hence, it is expected that ongoing crises would erupt over the fields in question. The first step to reduce risk and incentivize international companies to operate in border areas involves cooperating with an international third party to demarcate maritime boundaries and document them with the UN, before beginning exploration and production. This does not preclude the possibility of armed conflicts over the petroleum fields, however. Indeed, Israel has a rich history in not only confiscating Arab water resources, but also occupying the Sinai Peninsula and exploiting its oil fields for many years, even when those fields were nowhere near Israeli borders, often hundreds of kilometers away. In the end, the most important deterrent to prevent war in adjacent oil-rich areas is the devastation that could affect all parties concerned, sometimes for many years after the hostilities end. * Mr. Khadduri is a consultant for MEES Oil & Gas (MeesEnergy)
