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Five Bidders Win Rights to Explore Croatia Oilfields

Croatia has revealed the name of five companies that have won bids to explore gas and oil deposits on the Adriatic seabed.

Croatia has named five companies that have won rights to explore gas and oil deposits on the Adriatic coast. The five are the Croatian-Hungarian company INA, Greece's Marathon Oil, Italy's ENI, Medoilgas of Italy and the Austrian company OMV.

The government approved the bids of the five companies at a closed session on Friday, rejecting an unknown sixth company.

Although companies submitted bids for 15 zones, the government accepted bids for only ten. Marathon Oil and OMV will explore for gas and oil in seven zones from the north to the south of the Adriatic coast. ENI and Medoilgas will do likewise in one zone in the centre of the Adriatic Sea, while INA will explore two zones in the southern Adriatic.

Concessions will be offered for a three-year exploration period, which can be extended with a two-year period for both exploration and exploitation.

After these five years, a concession for 25 years may be granted. The tender for off-shore gas and oil exploration and exploitation was opened from April and lasted to November.

Over the last two months of 2014, an eight-member committee, along with the Economy Minister, Ivan Vrdoljak, reviewed the bids. Companies competed for a total of 29 exploration and exploitation zones, each varying from 1,000 to 1,600 square km. Since offers were accepted only for ten fields, a new tender for the remaining 19 zones is expected in the first half of 2015.

After negotiating the conditions of the concession, contracts with the companies will be singed by late March. The government opened another on-shore gas and oil tender in July 2014 in Slavonia, in eastern continental Croatia, which will be closed in February 2015.

The government claims the fields in the Adriatic have the potential to attract around 40 million euro in direct investment, reviving Croatia's flagging local economy.

Experts are more sceptical about the amount gas and oil under the Adriatic seabed, saying the real extent will only become clear in five years.

NA
Copyright:
Balkan Insight
Published on:
January 5, 2015
Source url:
http://www.balkaninsight.com/en/article/5-companies-will-negotiate-oil-and-gas-exploration-concession
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