BEIRUT, Lebanon, Sept. 27 (UPI) -- Lebanese Energy Minister Gebran Bassil says economically battered Lebanon is "technically ready" to start drilling for natural gas in the eastern Mediterranean, an assessment industry insiders say is overly optimistic.
The Lebanese, plagued by sectarian differences that cripple the few initiatives the Beirut government actually undertakes, are years behind neighboring Israel and Cyprus in the drive to tap into the region's vast undersea energy reserves.
But more importantly, fears that the civil war in neighboring Syria and political upheavals across the Arab world since January 2011 will ignite sectarian bloodshed across the region could scare off international oil companies from investing in the Lebanese operation -- once it gets off the ground.
The government, torn by sectarian rivalries, hasn't even managed to establish an energy body to deal with drilling and production licenses and that's stymied efforts to get exploration going.
Rudi Baroudi, a Lebanese energy economist in the United Arab Emirates, warned Wednesday that Europe's financial crisis will likely lead to a decrease in energy demand.
That could make investment in the eastern Mediterranean even less attractive, although "this does not appear to be a major constraint on the large (international oil companies) to invest in exploration.
"The main constraining factor in the region is the widespread perception of high risk due to the climate of political turmoil, the euro crisis, rule of law in certain countries and some uncertainty exacerbated by the Arab uprisings," said Baroudi, chief executive officer of Energy and Environment Holding.
The region's governments, he told a Mediterranean energy conference in Cyprus, need to get creative if they want to convince major oil companies to get involved in the gas and oil exploration programs.
The prize is considerable. The U.S. Geological Survey said in 2010 the Levant Basin contains 123 trillion cubic feet of natural gas and around 2 billion barrels of oil.
Baroudi estimated earlier this year that Lebanon's gas reserves were three times greater than Libya's 53 tcf and that Lebanon could produce around 90,000 barrels of oil a day over the next 20 years.
Bassil said Monday that seismic surveys off Lebanon's southern coast, which borders the gas-rich waters of Israel and Cyprus, indicate those waters contain 12 tcf.
"That's enough to produce electricity for Lebanon for 99 years," he boasted. He had no estimates for other Lebanese zones.
Lebanon suffers from chronic power shortages, the result of inept governance, shortage of funds and rundown equipment.
Resource-poor Lebanon also has a national debt of some $54 billion.
Lebanon has reached agreements with Cyprus on defining territorial waters but Beirut's locked in a dispute with Israel, with which it's still technically at war, over maritime boundaries.
Israel, which leads the regional gas drive, has reserves estimated at around 30 tcf. Much of that is in its largest offshore field, Leviathan, which Lebanon says runs into its waters. A zone of around 330 square miles is in dispute.
Lebanon's Iranian-backed Hezbollah movement, which has a military force stronger than the Lebanese army and fought Israel to a standstill in a 2006 war, has warned it won't allow Lebanon's energy assets to be "plundered."
Israel has warned it will use force to defend its offshore bonanza that will give it energy independence for the first time and transform its economy.
It's expanding its navy to provide protection for its offshore gas fields and other infrastructure against Hezbollah suicide bombers and its estimated 43,000 missiles and rockets.
Israel and Cyprus are joining forces to export their gas to Europe, a move that incensed Turkey, which is striving to become the regional energy hub between east and west.
Turkey invaded Cyprus in 1974 and seized the northern part of the island. The gas fields lie of the southern Greek Cypriot sector. Ankara has threatened to send warships to prevent exploration, which has already uncovered an estimated 7 tcf in the newfound Aphrodite field.
Greece and Turkey are longtime rivals and there's a threat hostilities could be resumed.
But if there are concerns the eastern Mediterranean, which includes war-torn Syria, could erupt there's not much evidence of it from the investment now focused on Israel and Cyprus.
Volatile Lebanon and its sectarian rivalries, however, could be a different story.