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Lebanon’s energy promise could be regional game changer

January 16, 2018 By administrator

Joe Macaron,

Three interconnected developments that occurred in December 2017 will have a lasting impact on Lebanon. The Lebanese government made two long overdue decisions: launching the energy exploration process and setting the parliamentary elections date for next May. The third development is a breakthrough that has regional implications: a United Nations-sponsored meeting was held between Lebanon and Israel to discuss for the first time the demarcation of their maritime border, an official Lebanese source told Al-Monitor.

After years of tensions and delay, the Lebanese government had agreed in January 2017 on a formula to divide the offshore oil and gas blocks along the Lebanese coast on a political, geographical and sectarian basis. The winning bidder of the first licensing round was a consortium of France’s Total, Italy’s ENI and Russia’s Novatek. Their bid was confined to two blocks only, including block 9 in south Lebanon near Israel’s Exclusive Economic Zone. Official sources in Lebanon told Al-Monitor that the exploration and production agreement between the Lebanese government and the consortium will be signed at the end of January, whereas exploration is expected to begin in mid-2019 and production in 2021-22.

The smooth flow of oil production can only be ensured by two factors: maintaining the minimal agreement among Lebanese leaders and maintaining the current rules of engagement between Hezbollah and Israel.

On the domestic level, the energy process will largely depend in the foreseeable future on the dynamics between President Michel Aoun and parliament Speaker Nabih Berri. Aoun aims to keep the oil and gas exploration process in the Energy Ministry, which has been under the influence of his political movement since 2009, while Berri seeks to establish alternative institutions that allow him to exert control over the process.

The next parliament, with a term that expires once the energy exploration concludes in 2022, will have to debate and vote on establishing a sovereign fund to preserve and invest the surplus revenues of oil and gas production. The exploration process’ financial dimension is currently led by a small unit in the Finance Ministry, while the energy minister, advised by a multi-confessional Petroleum Authority, handles the technical side. Moving forward, Lebanese politics is not expected to have an impact on the exploration process, at least until production starts.

The maritime blue line

It is increasingly obvious that oil and gas exploration in the Mediterranean adds a new layer to the complex enmity between Israel and Hezbollah, most notably in Lebanon’s southernmost blocks where oil and gas reserves are potentially abundant. The blue line that was drawn in 2000 between Lebanon and Israel, from Shebaa Farms to Naqoura, was not extended into the sea, which caused a dispute over 860 square meters (9,257 square feet) of international waters and triggered an energy exploration race between Lebanon and Israel.

US and UN efforts to resolve that dispute have previously failed and have been suspended since 2014. However, an official source in Lebanon told Al-Monitor that a trilateral meeting was held in late December 2017 between military commanders from Lebanon, Israel and the United Nations Interim Force in Lebanon (UNIFIL) to discuss the demarcation of what is known as the maritime blue line. Meanwhile, Lebanon and Israel are making sure not to come close to the disputed international waters.

Indeed, the geopolitical impact of energy discovery on Lebanon and its neighborhood should not be understated, as it helped the country withstand domestic and regional turmoil since 2011, from upheaval in Syria to the recent resignation saga of Prime Minister Saad Hariri. As a result, the United States became more cautious in approaching Lebanese politics to help Israel clear roadblocks to become an energy player in the Middle East. Satisfied with the status quo along the Lebanese-Israeli border since 2006, both Hezbollah and Israel became less interested in a confrontation as they eyed the economic benefits of oil production.

The international community is invested as well in maintaining stability. The European-Russian consortium reflects a decision to sponsor Lebanon’s entrance to the petroleum production, which some have called a “petroleum UNIFIL,” as both France and Italy are heavily invested in the UNIFIL forces operating near the Lebanese-Israeli border.

Impact of energy production on Lebanon

Lebanon is not expected to become a major energy exporter, as the country’s excessive demand for electricity is big enough to absorb the energy production in the next two decades at least.

The data speculations regarding the estimated oil and gas reserves have fluctuated over the years. An official Lebanese source was skeptical, saying, “For sure, we do not have proven reserves. What is publicly available is informal information.” Furthermore, the production costs tend to increase when we move away from the Nile to the Mediterranean basin due to the thick sedimentary cover of the rocks on the Lebanese coast. While the Energy Ministry and the consortium signed a production-sharing agreement, production costs can later increase and cut the profits of the Lebanese state.

Managing expectations is paramount regarding the potential benefits and rewards of energy production. The Lebanese government has yet to devise a long-term economic plan or offer a road map that addresses the country’s crippling electricity problem and a national debt spiraling out of control. Lebanon’s energy promise could indeed be a regional game changer, but the jury is out on whether the Lebanese people will get the chance to reap the economic benefits.

Filed Under: Articles Tagged With: energy, Lebanon’s, promise

Energy sector keystone of Armenian-German cooperation – minister

June 29, 2017 By administrator

Armenia Germany energy cooperationThe energy sector is among the keystones of Armenian-German cooperation, Ambassador Matthias Kiesler said today, highlighting the priorities of joint projects.
Speaking at a workshop organized for beneficiaries of a renewable energy loan program, the diplomat said his country has already allocated €150 million of which €50 million was spent on the renovation of the Vorotan Hydro Cascade’s electric power stations.

“We provide money also for retraining courses, so our meeting today is part of those activities. Apart from the energy power project – which has attracted €170 million – we also assist in the regional electric network improvement efforts. To do that we need also legislative regulations and acts,” he said, stressing also the importance of having effectively functioning networks.

The ambassador also called for stepping up the solar power production and evaluating the renewable power sources’ environmental impact.

“It is important for the key actors in the sector to properly understand renewable energy’s environmental impact to reduce it to a minimum,” he added.

Mr Kiesler, who is an electrical engineer by profession, said his country is now embarking on the production of non-traditional energy sources.

“I think that a gradual transition to renewable energy will be very useful for Armenia too. Renewable energy, particularly solar power, is considerably cheaper today, so it can be competitive with the traditional sources. For a country which has the [Metsamor] Nuclear Power Plant, as well as natural gas-powered stations as the key energy producers, it is very important to diversify the energy sources to supplement them with renewable power. That will help Armenia ensure the energy security in the country, as well as reduce the greenhouse gases’ export,” he added.

 

Filed Under: Articles Tagged With: Armenia, cooperation, energy, Germany

UAE’s Ocean Holding to invest $100 mln in Armenia’s energy sector

March 22, 2017 By administrator

A memorandum of understanding was signed between Armenia‘s ministry of energy infrastructures and natural resources and Ocean Holding LLC in Abu Dhabi, UAE on Wednesday, March 22. The cooperation will seek to develop the renewable energy sector in Armenia and provide Ocean Holding an opportunity to make investments in solar energy projects.

Beginning this year, Ocean Holding intends to invest $100 million in solar photovoltaic power plants in Armenia and operate them using the most advanced technology currently available.

The ministry, in turns, aims to create favorable conditions for Ocean Holding. The investments will be carried out in several phases.

The deal was signed on the sidelines of the Armenia Investment Forum 2017 in Abu Dhabi, UAE, with Armenian president Serzh Sargsyan and Deputy Supreme Commander of the UAE Armed Forces Sheikh Mohammed bin Zayed bin Sultan Al-Nahyan also participating.

Filed Under: Articles Tagged With: Armenia, energy, uae

‘Azerbaijan worries that Armenia can be outcome for Turkmenistan energy carriers:’ Vardan Voskanyan

January 25, 2017 By administrator

“Turkmenistan bordering Iran is one of the five countries with gas resources. It has huge energy resources but also problems relating to exporting them. These resources are directed mainly to China but because of the price fall in energy resources, Turkmenistan is looking for ways to the West,” said expert in Iranian studies, Vardan Voskanyan, at the meeting with the journalists at Sputnik Armenia press center, referring to the meeting of RA Prime Minister, ambassadors of Iran and Turkmenistan held in January. Recall that the meeting discussed the possibilities of trilateral cooperation in the energy sphere. According to Vardan Voskanyan, Armenia can become an outcome Turkmenistan’s energy carrier consumption, “Armenia must run a more aggressive policy in a positive sense in the industries when we are not so expected. Our country can obtain serious opportunities to develop the economy. The formation Iran-Armenia-Turkmenistan format will promote the enhancement of Iran-Armenia-gas-energy format which may also include Russia and Georgia.”




The expert in Iranian studies noted that Azerbaijani expertize circles have promptly reacted to the meeting of RA Prime Minister and the ambassadors which indicates that there is an anxiety in Azerbaijan. However, according to Vardan Voskanyan, the RA economic agenda should not be associated with the reactions of the opponents but it is necessary to work for the establishment of the mentioned tripartite format. Vardan Voskanyan also opines that the Russian policy prefers here the participatory approach rather than a hindrance.

Read more at: http://en.aravot.am/2017/01/25/188341/

Filed Under: Articles Tagged With: Armenia, Azerbaijan, carriers, energy, Turkmenistan

Putin visits Greece for energy, investment talks

May 27, 2016 By administrator

Putin in greeceRussian President Vladimir Putin made his first trip to a European Union country this year Friday with a visit to Greece that will include a stop at a secluded Christian Orthodox monastic sanctuary in the country’s north.

Under heavy security, Putin arrived for a two-day visit expected to focus on energy cooperation and Russian investments during talks with Greek Prime Minister Alexis Tsipras.

Athens is keen to maintain its traditionally close ties with post-Soviet Russia, despite its participation in European Union sanctions against Moscow, and a gas pipeline project designed to limit Russia’s regional energy dominance.

Putin was met at Athens Airport by Defense Minister Panos Kammenos as air force F-16s buzzed overhead as part of a welcoming ceremony.

Russia is one of Greece’s main trading partners, but business has been hit by the sanctions and drop in commodity prices.

Greece is also keen to reverse a slump in tourist arrivals from Russia last year.

“This will be the first time Putin has visited an EU country in the past six months and Russia-EU relations will be definitely on the agenda,” said Alexander Kokcharov of the U.S.-based IHS Country Risk group.

“Putin is likely to offer investment projects in Greece, most likely in energy and transport sectors. However, we do not expect that Greece would go against the EU consensus.”

Some 2,500 police will provide security for Putin’s visit in Athens, and much of the city center will be blocked to motorists and public transport.

On Saturday, Putin will visit the Monastery of St. Panteleimon, which is inhabited by Russian monks. It’s set in the 1,000-year-old Mount Athos autonomous monastic community, from which women are banned.

He will be accompanied by the head of Russias Orthodox Church, Patriarch Kirill of Moscow, who arrived in northern Greece on Friday.

[AP]

Filed Under: Articles Tagged With: energy, Greece, investment, Putin, talks, visits

Armenia, Georgia, Iran, Russia: towards a common energy market?

December 24, 2015 By administrator

arton120198-480x270The energy ministers of Armenia, Georgia and Iran, as well as the CEO of Russian electricity company leading, met yesterday in Yerevan to study the possibility of increasing significantly energy trade between their countries.

The Armenian Ministry of Energy and Natural Resources said the four nations will be able to establish a common energy market after the construction of two new power lines connecting Armenia with Georgia and Iran.

“We are here today to ensure that we can prepare by 2017-2018 technical and legal framework for further synchronize our power grids,” said the Minister of Energy of Armenia, Yervand Zakharian, told reporters after interviews.

The Energy Minister, with his Iranian counterpart, Hamid Chitchian and Georgia, Kakha Kaladze and with the director of transmission and distribution network of Russian national electricity Oleg Budargin, signed a Memorandum of Understanding.

Kaladze stressed the importance of the document when he met Prime Minister Hovik Abrahamyan later in the day. A statement from the Armenian government quoted the Georgian Minister as stating that this will create “favorable conditions” for regional energy cooperation.

“The deepening and expansion of the interaction between the energy systems of the four countries will allow the creation of a regional energy market,” assured the Armenian Ministry of Energy in a statement. “The parties expressed their willingness to coordinate their efforts to advance the program.”

In this regard, the Declaration stressed the importance of the ongoing construction of a third and far more powerful high-voltage transmission line between Armenia and Iran. For Zakharian, installation, that will cost $ 120 million, will quadruple the Armenian electricity exports to the Islamic Republic.

The ministry also stressed that Armenia and Georgia will soon start building a similar line that will make their much interconnected power grids. The $ 115 million project, whose completion is also expected in 2018, is financed by the German KfW development bank, managed by the state and the European Union.

“The construction of these lines will enable the four countries to exploit their energy systems of joint and parallel and increase the volume of trade in electricity during emergencies”, welcomed Zakharian.

The planned multilateral arrangement is clearly facilitated by the gradual lifting of international sanctions against Iran. It could also be related to the recent decision of the Georgian Government to consider the possibility of purchasing natural gas to Russia and Iran. Kaladze said in October that Georgia, which currently buys most of its gas to Azerbaijan, may soon import Iranian gas via Armenia or Azerbaijan.

Thursday, December 24, 2015,
Claire © armenews.com

Filed Under: News Tagged With: Armenia, energy, Georgia, Iran, Russia

Costa Rica closes 2015 with 99% renewable energy

December 20, 2015 By administrator

renewables_.nCosta Rica has boasted that almost all of the energy it has produced in 2015 came from renewable sources, making the small Central America country a global leader in green energy.

“We close 2015 with 99 percent of clean energy!” announced the Costa Rican Electricity Institute (ICE) on Facebook, saying that “the energy produced … in 2015 reaches 98.95 % with renewable sources as of December 17.”

According to the group, the country managed to power 285 days in the period from January 1 through December 17 using only renewable energy.

“We are closing 2015 with renewable electricity milestones that have put us in the global spotlight,” AFP cited ICE electricity division chief Luis Pacheco as saying, predicting even better results for Costa Rica’s energy sector in 2016.

Costa Rica even managed to surpass its energy targets, despite the fact that 2015 “had been extremely dry,” ICE added.

Three quarters of the country’s electricity comes from hydroelectric power stations – Costa Rica has abundant river system and experiences heavy rainfall. Other sources of green energy are geothermal, wind, biomass, and solar.

Filed Under: News Tagged With: 99, Costa Rica, energy, renewable

Results of the first phase of study of Armenia’s energy sector made public

September 30, 2015 By administrator

Armenian-electricYEREVAN. – Deloitte & Touche consulting company presented the results of the first stage of the study of Armenia’s energy sector under the agreement reached with the Armenian government, Public Services Regulatory Commission and consulting company.

The final part of the report, in particular, reads: “According to the results of the study, we concluded that the distribution between the two tariff years of the reconstruction program of the Armenian nuclear power plant together with the launch of the new unit of Hrazdan-5 will keep the final rate at the current level.”

Filed Under: Articles Tagged With: Armenia, energy

Energy cooperation of Armenia and Iran discussed in Yerevan

July 29, 2015 By administrator

Armenia-Iran-EnergyIssues related to energy cooperation between Armenia and Iran were discussed in Yerevan, the press service of Armenian Ministry of Energy and  Natural Resources reported.

According to the source, Armenian Energy Minister Yervand Zakharyan received yesterday Director of Iranian Export and Development Bank Ali Saleh Abadi, Iranian Ambassador to Armenia Mohammad Raiesi, and Sanir Company’s director.

The sides discussed a range of issues concerning Armenian-Iranian energy cooperation. They underlined the importance of joint projects, in particular the project on construction of the 3rd high-voltage transmission line between Armenia and Iran and financial issues related to the project were considered.

Source: Panorama.am

Filed Under: Articles Tagged With: Armenia, energy, Iran

Energy Matters: Fate of Armenian power grid on agenda of Yerevan-Moscow relations

July 1, 2015 By administrator

By Naira Hayrumyan
ArmeniaNow correspondent

540x360xvorotan.jpg,,Mic_.SXziG2iwPJ_0.jpg,Mce_.SXziG2iwPJ.jpg.pagespeed.ce.SXziG2iwPJAmid continuing street protests against rising electricity tariffs in Yerevan, the fate of the Armenian power grid remains a key issue both in the sphere of Armenia’s internal political developments as well as on the agenda of Armenian-Russian relations. The Electric Networks of Armenia, the current operator of the grid, is owned by the Russian company, Inter RAO, but periodically information appears in the press to suggest that there are intentions to sell it.

The Russian newspaper Kommersant writes that among the likely buyers are two Russian businessmen of Armenian origin, including Samvel Karapetyan, the owner of Tashir Group. However, analysts in media do not rule out the possibility that the power grid will be bought by American or European companies.

Government officials in Yerevan do not comment on such a possibility. Minister-chief of government staff David Harutyunyan says one should wait for the results of the audit, but he does not rule out the probability of the company’s sale either.

It is clear, however, that the further vector of Armenia’s development may hinge on the fate of the energy system. Officially, without abandoning friendship with Russia, Armenia may set up partnership relations with Western companies in the energy sphere that will help “diversify” the South Caucasus nation’s foreign policy. At present, this course is clearly pro-Russian and, as some critics claim, it is leading to the loss of sovereignty.

Armenian Prime Minister Hovik Abrahamyan says a concept of energy security till 2036 is being developed at present. He speaks about large projects in this sphere, but does not disclose details.

Visiting Armenia these days is Masood Ahmed, the Director of the Middle East and Central Asia Department at the International Monetary Fund (IMF). Media inquired from Ahmed on Tuesday whether the IMF was familiar with the projects mentioned by the Armenian prime minister. He said that Abrahamyan had told him about those projects, too, but added, “It would be better if we got acquainted with them and analyzed them.”

The IMF official said that in the next three or four years a worsening situation is expected in the region, and, in particular, in Russia. And in order to ensure high indices it is necessary to attract large investments and remove barriers for investors.

He advised that the government in Yerevan pay attention to the opportunities that are being offered to the Armenian side. The lifting of Western sanctions against Iran, according to Ahmed, can attract also the Iranian capital to Armenia.

Head of the IMF mission to Armenia Mark Horton noted that the Electric Networks of Armenia had been sold to Russia under the Equities for Debt deal. If they had been sold through a tender, he said, the management would be more effective.

Horton noted that the energy system of Armenia needs large investments, because the system is getting worn out, with the main task being to build a new nuclear power plant. “In eight years, it will have to be replaced, and it will cost about $5 billion. It will be difficult to find that money. Therefore, strong partnership will need to be formed or Armenia will need to look for other options,” he said.

Horton did not elaborate as to what he implied by strong partnership. But it is clear that Armenia has been unsuccessful in forming “strong partnership” with the Russian companies that own Armenia’s energy system today. With the highest tariffs in post-Soviet space set in Armenia, Russian companies have been reluctant to invest in the development of the Armenian system, carrying out inefficient management.

Whether strong partnership with Western or even Iranian companies is possible remains to be seen, but it is clear that without “foreign-policy diversification” the Armenian energy system may find itself in a deep crisis that is only emerging today.

Filed Under: Articles, Events Tagged With: Armenia, energy, Russia

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