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French Version

Natural gas power : Electricite du Liban cleans up its act


There is a new revolution brewing in Lebanon, but it will not involve protests, tent-cities, or high-level resignations. This revolution comes from, of all places, Syria, and some even say it could eventually change how Lebanese people live their daily lives.

When natural gas flows into a power plant in North Lebanon next week, it could be the start of a new energy era in Lebanon.

"A Lebanese-Syrian committee is expected to meet next week to see if there are any last problems but basically we are ready," Ishaq Elias, a pipeline manager, told The Daily Star. May 5, he said, is the estimated time of arrival.

Rolling summer power blackouts, power costs higher than any country in the region, and even the thick layer of black-brown smog that tends to gather over Beirut have all been named as possible relics of the past by natural gas optimists, who are hoping that power plants throughout Lebanon can end their reliance on fuel-oil.

"The production cost of electricity will go down, emissions from the plant will be a lot cleaner, and the environmental effects will be positive," said Raymond Ghajar, associate professor of electrical engineering at the Lebanese American University. "Natural gas is much cheaper than gas oil and with the pipeline the supply is much more reliable."

Can the much-maligned Electricite du Liban (EDL), which loses about $400 million per year, take credit for finally doing something right? Not quite. The conversion is late - Lebanon is one of the last countries in the region to still operate all its power plants on fuel-oil - and it's been plagued by management mishaps. Lebanon spent more than $600 million in 1997 building two natural gas power plants, Deir Ammar and Zahrani, only to have them run below capacity for years on polluting fuel-oil while plans for natural gas pipelines were delayed.

But there are ambitious plans in the works and if cheaper electricity could help turn EDL around, Lebanon will be in a better position to move forward toward privatization of the cumbersome state energy company as promised at the 2002 "Paris II" conference.

"It can help improve the efficiency of operation and it can improve the financial viability of EDL," Tjaarda Storm van Leeuwen, a World Bank lead financial analyst assisting the Lebanese government on energy issues, told The Daily Star. "There's more needed in terms of reforms, but a more efficient fuel is part of the solution."

The World Bank estimated that switching from fuel-oil to natural gas will reduce energy costs from $300 million to $140 million per year and will avoid damage to the environment and to public health estimated to be at least $740 million over a 15-year period.

The high price of fuel oil currently represents about 70 percent of the total cost of EDL. Syria is offering Lebanon preferential prices for the 1.5 million cubic meters per day it will send through the 33 kilometer pipeline to Deir Ammar, which is expected to save EDL $100 million per year, the Energy Ministry estimated.

Running at full capacity on natural gas, Deir Ammar will produce 450 megawatts, about 30 percent of Lebanon's current output of some 1,400 megawatts. The country's electricity needs, according to some estimates, range up to 2,100 megawatts.

The Energy Ministry plans to begin running the Zahrani plant in South Lebanon on natural gas within 14 months, first by overseas shipments of gas from Deir Ammar and then by an undersea pipeline.

There's also a $1 billion Arab Gas Pipeline which will begin in Egypt and pass through Jordan and Syria before reaching Lebanon. It should begin supplying almost 1,000 cubic meters per day to Zahrani later this year, more than six times the volume provided by the northern pipeline from Syria.

"These two pipelines together will make a very strong and reliable system," said Ghajar.

Natural gas could eventually replace fuel-oil and electricity for home heating throughout Lebanon at a cheaper price.

"If there is enough supply, we will eventually be able to think about natural gas distribution in the big cities," Ghajar said.

Beirut 02-05-2005
Will Rasmussen
The Daily Star

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