Governance issues raised around the awarding of the Schlumberger Contract
on 7/30/2020

This article was published in LOGI's July 2020 newsletter in partnership with Kulluna Irada

Cabinet in mid-July agreed to a proposal by Energy Minister Raymond Ghajar to sign a deal with Schlumberger in a $650,000 contract that was first proposed three years back. 

In 2017, the contract was held up due to questions about its validity given that the company was not selected via public tenders. There have also been reports that Lebanon could undertake such a study at little to no cost in through a 2018 partnership with Norway that includes support for Lebanon’s oil and gas sector at the technical, government and civil society level.

The contract is set to be overseen by the directorate of Oil at the Energy Ministry, rather than by the Lebanese Petroleum Administration, which is the sector’s regulatory authority. This is despite the fact that the LPA said in 2017 that it sought to oversee the contract in cooperation with the directorate, Al Akhbar reports. 

Successive energy ministers have come under fire for seeking to centralize power within the ministry rather than handing it over to bodies that are politically independent. A notable example is the failure of successive ministers to appoint members of an electricity sector regulatory authority and water down a 2002 law that mandates its creation. 

The LPA should be allowed to play a regulatory role in the sector, rather than simply an advisory role - a position that successive energy ministers have been keen on restricting it to.

Photo Source: Al Akhbar

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