US 'exempts' Lebanon from Caesar sanctions for natural gas imports

The US will "exempt" Lebanon from Caesar sanctions to allow them to receive natural gas and electricity through Syria, Lebanese FM Abdullah Bou Habib told Lebanon’s president on Thursday.

Lebanon is slated to receive Egyptian natural gas in a four-country deal that was announced in August. Egyptian natural gas will travel through Jordan, to Syria, and then on to Lebanon, where it will be used for electricity generation. The natural gas will also be used to generate electricity in Jordan, which will also be sent on to Lebanon.

The US has imposed sanctions on any individual or government engaged in “significant transactions” with Syria under the Caesar Civilian Protection Act of 2019.

It was previously unclear if any of the countries involved in the natural gas deal would fall afoul of the Caesar sanctions.

However, on Friday, the US Ambassador to Lebanon, Dorothy Shea delivered gave assurances to Lebanese PM Najib Mikati.

Shea handed Mikati a letter from the US Treasury Department to "to answer some of the concerns the Lebanese authorities had regarding regional energy agreements that the United States helped facilitate between Lebanon, Jordan and Egypt".

In a tweet later that day, the Lebanese PM’s account said that “there won’t be any concerns from the US sanctions law.”

On Saturday, Lebanese daily Al-Akhbar reported that there remained "confusion" over the US requirements on importing Egyptian gas via Syria, with "many conditions yet to be met" before the deal can go ahead.

Cairo appeared to be hesitant on moving forward with the deal unless it obtained US guarantees and “not just an assurance letter”, the paper said.

Lebanon desperately needs both the natural gas and electricity that would come with the multi-country gas deal. The state power grid is currently failing, providing at most three hours of electricity a day with periodic blackouts.

Lebanon currently only produces about 700 megawatts of power, but needs between 3,000 and 3,500 megawatts annually to cover the needs of its population. The natural gas deal would boost the state’s capacity by 450 megawatts, increasing daily power by about three hours a day.

In an interview last month, Lebanese Energy Minister Walid Fayyad said that repairs to key pipeline infrastructure in Lebanon would be completed by end of February. He did not specify when the natural gas would first reach Lebanon.

This article has been updated for clarity.