Tuesday, June 28, 2005

Lebanon's Oddesy - The Energy Sector (2004 - 2005)

Here are some articles in The Daily Star that are relevant to the issue of Energy - each is followed by a quote from the article that I found relevant and interesting:


Thursday, February 12, 2004 "The multibillion-dollar power grid will link Jordan, Syria, Iraq, Lebanon, Egypt, Turkey and Libya in the first phase."

Thursday, March 04, 2004 Energy and Water Minister Ayoub Humayed said that the gas pipeline, GASYLE I, linking Syria’s industrial compound in Banias to Lebanon’s Deir Ammar power station would be completed in June 2004.

Saturday, March 13, 2004 "Spectrum and TGS-Nopec carried out a 2D seismic study of Lebanon’s seabed, ECL and AT Energy conducted geological assessments of the offshore area, Suez/Tractebel advised the ministry on the Syrian-Lebanese natural gas transmission project and the liquefied natural gas terminal, Baker Botts will work on the upstream legal guidelines and Denton Wilde will work on downstream legal guidelines."

Thursday, June 17, 2004 The sources did not explain the technical reasons for this delay but stressed that the power plants in Lebanon will definitely switch to the Syrian gas before the end of 2004. The new flow of natural gas into Lebanon will be made possible as soon as the construction of the 32-kilometer natural gas pipeline, GASYLE I, is completed.

Tuesday, September 28, 2004 Speaking to reporters in Beirut after attending a weekend meeting of Arab energy ministers in Cairo, Humayed said that it was agreed that Syria would link its own gas network with that of the Arab Gas Network. The minister predicted that by 2006 the Arab network would be linked to the Turkish gas network, thus achieving a six-state gas link-up.

Saturday, November 06, 2004 To appease growing Lebanese anger, Khoury told officials here that Damascus is ready to help Beirut overcome some of its problems, such as reducing the cost of electricity production. Khoury said Syria is building a gas pipeline that would supply gas to two power plants in Tripoli and Sidon.

Saturday, November 13, 2004 Ministers and economists warned on different occasions that the government cannot afford to keep spending money on EDL, adding that the Treasury had spent over $11 billion over the past 10 years trying to fix the company's problems.


Wednesday, February 02, 2005 Syria was supposed to supply natural gas to Lebanon in 2002 through a pipeline but due to technical difficulties the agreement never materialized.... The cost of kilowatts in Lebanon is three times higher than in Syria, Egypt and Turkey.

Thursday, February 10, 2005 The International Monetary Fund and many rating agencies have been urging the Lebanese government to restructure EDL, warning that Lebanon's energy sector is draining resources from other areas of the economy.

Friday, April 01, 2005 The pipeline was completed on March 17 and when the upgraded Deir Ammar power station, built near the Syrian border in 1997, comes online it will save Lebanon $100 million in energy costs, said a ministry statement.

Thursday, June 09, 2005 "Officially [the Syrians] told us there was a problem with software which will take some time to fix. They told us they need some instruments from the U.S. which will be difficult to get because of the embargo...." The Syrian Gas Company could not be reached for comment yesterday afternoon.

Tuesday, June 28, 2005 There were numerous efforts to restructure EDL and cut losses but the problems were overwhelming.

COMMENT: These "technical difficulties" have been going on since 2002, and they never seem to end!!!


ThinkingMan said...

It all sounds very "fishy" to me. It does call for a grand investigation as you suggested in the previous post.
Good job on the chronology of events- there is more to it definitely.

hummbumm said...

Very cool, clearly the pipeline is a pawn in the greater game. $11B on EDL? oof that is a third of the deficit. Wow
I have to say that savings of $100M a year don't seem that big, we could probably reach that by layoffs at EDL, but it would be good to have both fuel oil and natural gas plants for diversification.

Raja said...

dude!!! saving a hundred million a year by layoffs??? how many people does EDL employ? ;)

However, your point is well-taken. the monstrosity we call EDL has to be brought to heel.

I am also amazed at the fact that an entire third of Lebanon's debt can be attributed to EDL. That is just ridiculous!

hummbumm said...

Ooops, forgot to plug in lebanon wages and benefits. Where we could really save money is in the totally bloated security sector. Between army, internal security, police etc.... That could be trimmed by 20K people easy if not more. I read somewhere that there were 100k employed in the security sector in leb. I may be totally off base, but i know from my cousins that their one year of service was a ridiculous waste. that would be a good place to start

ThinkingMan said...

100 million out of 1 billion is only a 10% savings. It's not a paradigm shifter given the risks involved, and given the local accuracy record, plus or minus 10% could easily become a different number.
I would have liked to see something of a higher order of magnitude to get really excited.

Omni said...

Thanks for providing all that info!! :-)

Mustapha said...

Yeah Raja,

Great Research, keep it up!

zenobia said...

You know, guys, the only real answer is to work together with Israel and Jordan and share a bio industry. I know it sounds loony, but remember that Coal and Steel eventually led to the European Union (not vice versa)...