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Croatia says four companies to invest 78 mln euro in oil/gas exploration

Author Iskra Pavlova
Croatia says four companies to invest 78 mln euro in oil/gas exploration Croatia awards six oil and gas exploration licences for Pannonian basin in August 2019, Photo: Croatian Hydrocarbon Agency (CHA)

ZAGREB (Croatia), September 3 (SeeNews) - The four companies, which have just received six oil and gas exploration and exploitation licences for locations in northern Croatia, are expected to invest some 78 million euro ($85.3 million) in exploratory activities, energy minister Tomislav Coric said.

The companies are Croatian energy firm INA and Vermilion Zagreb Exploration, part of Canada-based Vermilion, which are already active in oil and gas exploration in Croatia, local retailer of petroleum products Crodux Derivati Dva and US oil company Aspect Holdings via its subsidiary Aspect Croatia. 

"Investment of around 78 million euro is only planned for activities of onshore hydrocarbon exploration," Croatian Hydrocarbon Agency (CHA) quoted Coric as saying in a statement on Monday after Coric and the head of CHA, Marijan Krpan, made a presentation of the licensed companies and their programmes.

The Croatian government decided on August 29 to award two oil and gas exploration and exploitation permits to each of INA and Crodux Derivati Dva, and one permit each to Vermilion Zagreb Exploration and Aspect Croatia.

Krpan said in the same statement that a total of 25 wells are planned to be drilled as part of the exploration works.

"If we add to this the exploration that has already been underway in eastern Slavonija, we expect some 30 new exploration wells in the next five years," Krpan said.

The awarded permits are a precondition for opening talks on the terms of contracts, after which the signing of the contracts should follow. The first seismic exploration works are expected to take place in the second half of 2020, CHA said.

Works will be carried out in locations in the western Slavonija region, which is located in the Pannonian Basin, largely bordered by the Danube, Drava and Sava rivers.

INA was awarded exploration licences for the Drava-03 and North-Western Croatia-01 blocks, Crodux Derivati Dva will carry out  works in the Sava-11 and Sava-12 exploration blocks, Vermilion Zagreb Exploration has received a permit for the Sava-07 block, and Aspect Croatia was awarded an exploration licence for the Sava-06 block.

The four companies have submitted bids for six of a total of seven sites spreading on more than 14,000 sq km in the Pannonian Basin that were offered in a tender opened in October 2018. 

The new locations represent a continuation of Croatia's strategy to launch new investments and revive domestic production of oil and gas. 

CHA said in a separate statement last week that three years after signing the contracts from the first wave of onshore licensing, the first results have come with INA reporting in July 2019 a commercial discovery of a gas deposit at the Severovci-1 well in the Drava-02 block.

In addition, Vermilion Zagreb Exploration informed in early August 2019 of its gas discovery in the Ceric-1 exploration well, at the location of the same name in the SA-10 exploration block in the Vukovar-Srijem County.

At the end of August, Vermilion notified CHA about a natural gas discovery at the Berak location in the SA-10 exploration block, which was confirmed by testing the Berak-1 exploration well.

($=0.914180 euro)