BEIRUT: As Lebanon gears up for the commencement of the first round of bidding for oil and gas contracts, Diana Kaissy, the new executive director for the Lebanese Oil and Gas Initiative, is focused on ensuring applicants are transparent. Sept. 15 marks the deadline for international companies to submit offers to oil and gas potential off Lebanon’s coast.
In her new role, Kaissy told The Daily Star the priority in the first months at LOGI is to profile each of the 51 companies and 13 operators that prequalified for exploration.
Part of this process is creating a report that details non-technical information on companies granted bids.
“We would like to be part of the due diligence process that is done when looking at those companies,” she said. But Kaissy said monitoring doesn’t end there.
As the only NGO in Lebanon focused on transparency in the oil and gas industry, LOGI hopes to apply scrutiny through every stage of the process to ensure the bidding companies abide by the rules after contracts are drawn.
“We want to make sure that it is [a] good licensing round, a transparent one whereby the companies that are awarded the licenses on certain criteria that are technical [legal] and also nontechnical [such as environmental]” she said.
Kaissy called oil and gas “a golden opportunity for Lebanon,” and said creating a successful framework for natural resource management must happen in the development stage.
A late bloomer compared to some other oil-producing countries in the Middle East, the oil and gas sector in Lebanon is still in its infancy – a crucial period to set the stage for how the sector will progress.
For Kaissy, this means the industry must consider not only contracts and legal measures but nontechnical factors like public participation, health, safety and the environment long before drilling is underway.
In an apparent effort to uphold these standards, Lebanon joined 51 other members of the Extractive Industries Transparency Initiative, a global standard to ensure checks and balances within oil gas and governance. “This is something really avant-garde when it comes to the rest of the sectors in Lebanon,” Kaissy said.
Officially part of EITI since January, Lebanon is the second country in the world to join EITI before companies actually started drilling.
Lebanon’s voluntary membership in the organization is a promising sign not only for monitoring corruption in the sector but also gives more incentive to attract foreign companies to the fledgling industry.
Kaissy said there’s major incentive for Lebanon’s oil and gas governance process to be as transparent as possible to attract international oil companies. “Lebanon wants to make its sector appealing to all these [companies],” she said.
While membership in the EITI is a promising first step in preventing corruption in the oil and gas sector, it can also be easily abandoned as membership is voluntary. “It has been used as a rubber stamp for transparency by many countries,” Kaissy said. Because of this, membership can’t be the only mechanism for monitoring the sector’s development – it also relies on the Lebanese public to invest in Lebanon’s oil and gas future. “Natural resources in Lebanon are owned by the people. They are ours,” Kaissy said.
With her previous role at the NGO Publish What You Pay, a civil society organization focused on accountability from oil producing countries, Kaissy said her nontechnical helps ensure that the public doesn’t get left behind during these crucial stages of the oil and gas sector’s development. “At each stage we look at how civil society can be part and parcel of the decision-making process,” Kaissy told The Daily Star.
But engaging civil society requires the public to first understand how the process works.
“We know that the public does not have enough information about the natural resources,” she said.
Part of LOGI’s work is raising public awareness about Lebanon’s resources and the oil and gas contract process. “These are not technical issues. These are issues that we all need to know if we want to have good governance of the sector,” she said.
Kaissy said she’s optimistic in LOGI and the public’s ability to influence Parliament and the Lebanese Petroleum Association as the oil and gas sector develops. “We want to make sure we sit around the table, we discuss and we really are able to make them understand where we are coming from. We will reach common ground.”
A version of this article appeared in the print edition of The Daily Star on July 13, 2017, on page 4.