Governing our oil

Following the recent gas discoveries off shore from Israel and Cyprus, Lebanon is keen to kick off exploration activities in its waters. Like many other prospective oil and gas producers around the world, it must draft contract terms, regulations and laws to direct investment behavior in the country and set up institutions that effectively control the actors involved in its nascent petroleum sector. Of course, it will want to do it right. Successful governance of the petroleum sector is only possible with capacity. The state needs qualified people and competent institutions to design the terms of oil and gas investment and to steer the petroleum sector according to the government’s broader resource development plan. Capacity is also critical for monitoring the performance of oil companies, assessing their development plans, auditing costs and collecting revenues from the sector. Prospective petroleum producers must focus on building this capacity. But the hitch is