The Lebanese government has passed a new petroleum tax law meant to tax revenues from oil and gas exploration activities. The law calls for a 20% income tax on future petroleum operations and adds a duty fee fixed at LbL5m (US$3,311). In the meantime, an auction round for offshore exploration licenses was expected for 15 September 2017 but has now been extended until 12 October 2017. It will be held for the 1, 4, 8, 9 and 10 offshore blocks and 50 companies (including Chevron, ExxonMobil and Total) have been pre-qualified so far for the licenses. As a result of the new law approval, qualified companies will have to take it into consideration when bidding for the upcoming energy tender.
Lebanon, which is estimated to hold at least 95 tcf (nearly 2,700 bcm) of gas and 750 mbl of oil in its territorial waters, is seeking to develop a domestic oil and gas industry, in the wake of the recent moves in Cyprus, Egypt and Israel. Three of the five blocks included in the licensing round (1, 4, 8, 9 and 10) are located near Israeli maritime borders, where large gas fields have been discovered since 2009. However, political troubles have delayed the licensing process for three years and the upcoming tender was delayed several times after the cabinet failed to pass decrees.
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