Following the Government’s resolution on the issue of “Approving the agreement on the maritime border between the State of Israel and the Republic of Lebanon”, a document of principles was signed last night (Monday, November 14, 2022) between the State of Israel, the French company TotalEnergies and the Italian company ENI.

TotalEnergies and ENI are the consortium that holds the license to develop Block 9 in Lebanon.

Lior Schillat, the Director General of the Ministry of Energy, stated: “Following the political agreement with Lebanon, we acted to secure Israel’s economic rights in the potential reservoir between the two countries. The agreement of principles we signed and the detailed agreement that will follow, if natural gas is discovered in the reservoir, will enable the development of a cross-border reservoir between hostile countries, an extraordinary event in the global energy market.”

The document of principles aims to ensure that the accord between Israel, Lebanon and the US, in a political agreement, also binds the consortium and that the reservoir will not be developed without upholding Israel’s economic rights.

The document of principles establishes an outline for the joint work of the parties until the signing of a detailed agreement that will include the financial consideration. Since exploration has not yet been carried out in the Sidon reservoir and the parties do not know the extent of the natural gas in the reservoir, the document of principles establishes guidelines for determining the economic yield, but not the yield itself.

Now, with the signing of the document of principles, the consortium will begin the exploration process and in the case of a natural gas discovery – the drafting of an economic plan for the development of the reservoir. Upon completion of this phase, a detailed agreement will be signed that will anchor, as stated, the economic yield that Israel will receive and only after that will it be possible to develop the reservoir for commercial purposes.