Lebanon is stepping up efforts to address its chronic electricity crisis through a proposed long-term energy partnership with Qatar, while negotiations over importing natural gas and electricity from Syria have reached an advanced stage, according to local media reports.

A Qatari technical delegation arrived in Lebanon for the fifth round of talks on Doha’s proposal to develop the power sector and secure long-term energy supplies. The discussions cover a broad investment program involving power plants, renewable energy projects and fuel supplies, with financing, guarantees, tariffs and implementation arrangements still under negotiation.

The latest round carries added significance after Energy and Water Minister Joe Saddi postponed a planned visit to Cyprus to follow the talks. He had also held an extended meeting with Prime Minister Nawaf Salam to prepare for further discussions with the Qatari delegation.

The visit follows a fourth round of negotiations in Doha, as Lebanon and Qatar work toward an agreement covering the wider development of the energy sector, rather than simply increasing electricity supplies.

Sources at the Energy Ministry told Annahar that the Qatari delegation prefers to keep its visit relatively low-profile. However, the proposal formally submitted to Lebanon is understood to include an integrated investment program to upgrade existing natural gas-fired power plants, particularly Deir Ammar in Tripoli and Zahrani, and connect them to gas supplies.

The plan also envisages building new power plants, investing in solar and wind energy, importing gas through Syria, maintaining pipelines and allocating land for the construction of energy facilities.

It further proposes a long-term natural gas supply contract that could run for up to 20 years, providing continuity of deliveries and greater stability in pricing. Reliable fuel supplies are essential to the efficient operation of power plants, while gas prices directly affect the final cost of electricity generation.

The investments are expected to follow a build-operate-transfer (BOT) model, under which the investor would finance, build and operate the facilities without requiring the Lebanese state to cover the initial investment costs. The state would, however, pay operating expenses and the cost of imported gas under a contractual arrangement that remains under negotiation.

The proposal therefore does not amount to free investment. It would distribute financial obligations between the investor and the state, making it necessary to establish revenue sources, financial guarantees and a tariff structure that allows investment and operating costs to be recovered.

In parallel, the International Finance Corporation (IFC) is preparing a study on electricity tariffs, taking into account investment, financing and operating costs, as well as meter installation and improvements to billing and collection.

Negotiators are also examining the guarantees investors would need to ensure that payments are made. One option under discussion is whether the Qatari government could support the proposal through the terms of gas sales or another arrangement that would help secure those guarantees.

Gas and Electricity Imports From Syria

Alongside the broader Qatari investment proposal, Lebanon is also moving toward arrangements to secure gas and additional electricity supplies from Syria.

According to sources cited by LBCI, discussions are focused on finalizing the arrangements and contracts for transporting gas from Syria to the Deir Ammar power plant in northern Lebanon. They also cover the import of 300 megawatts of electricity from Syria through the Ksara and Deir Nbouh substations.

The sources said negotiations over gas supplies had reached an advanced stage, suggesting that an agreement could be concluded soon.

The deal is expected to be signed in Doha in the presence of Salam and Saddi.

Implementation Will Be Key to the Project’s Success

International energy economics expert Naji Abi Aad told Annahar that the Qatari proposal appeared promising in principle, but cautioned against assessing it before its technical, financial and contractual details were fully available.

“Discussions about the prices being circulated remain within the realm of analysis and speculation. They cannot be considered final prices until the terms of the agreement become clear,” he said.

Abi Aad did not rule out the possibility that the options under consideration could include a price-support arrangement under which Qatar would cover part of the cost for a certain period as assistance to Lebanon. He said it was therefore too early to judge the cost of gas or electricity based on figures currently circulating, before the negotiations determine the final arrangement.

One issue he considers particularly important is the selection of sites for liquefied natural gas (LNG) regasification terminals and power plants. He said the matter should be clearly addressed from the outset, given Lebanon’s previous disputes over where such facilities should be built.

Earlier discussions had considered whether Zahrani or Tripoli would be more suitable, before Selata was also proposed. At one stage, there were even calls to build three regasification terminals.

Abi Aad argued that the number and location of such facilities should be determined by market demand and economic feasibility, rather than competing demands. Lebanon’s consumption is not large enough to justify numerous regasification terminals, even if the country makes a broad shift toward using gas to generate electricity.

Regasification terminals receive imported liquefied natural gas and convert it back into its gaseous form so it can be fed into the network and used to operate power plants.

Lebanon’s future energy needs could change, however, if regional conditions stabilize and exploration and drilling resume in Lebanese waters, potentially leading to the discovery of commercially recoverable gas reserves.

In that case, Abi Aad said, “domestic production could cover part of the market’s needs, reducing the need to import liquefied natural gas and, consequently, the need for regasification terminals to the same extent.”

He also stressed the importance of economies of scale when determining the capacity of the facilities.

“Building smaller plants could increase the cost per unit produced. The greater a facility’s production capacity, the more its fixed costs can be spread across a larger output, improving its economic viability — provided its size is in line with actual demand,” he said.

Abi Aad expressed hope that the government and Energy Ministry would approach the project seriously and that the administrative and institutional conditions would allow it to move forward this time. He also warned against the political disputes that have derailed previous energy projects.

“Investors becoming embroiled in local disputes over sites and shares could disrupt implementation and undermine their continued interest in the project,” he said.

Cyprus Offers Another Option to Diversify Supply

Alongside the Qatari proposal, a planned undersea electricity interconnection between Lebanon and Cyprus is emerging as another potential way to strengthen energy security and diversify electricity sources.

The two countries, with the participation of the World Bank, have begun preparing a preliminary feasibility study for a submarine cable that would allow Cyprus to export surplus electricity to Lebanon, particularly power generated from renewable sources.

For Cyprus, the project could provide an outlet for surplus solar power, which the country sometimes has to curtail when generation exceeds domestic demand. Lebanon, meanwhile, could gain an additional source of electricity, provided it addresses challenges involving its grid’s capacity to absorb new supplies, storage requirements, financing and regulatory arrangements between the two countries.

The project remains at the study and technical-discussion stage. Moving forward will require an assessment of its economic viability and an agreement on how the costs of the interconnection will be shared.

Geopolitical challenges linked to maritime disputes in the eastern Mediterranean also remain a factor. Progress from the feasibility stage to implementation will therefore depend on resolving outstanding technical, legal and financing issues.