Four wells scheduled for shallow waters of Istria block
The Derrick Digest is a weekly collection of curated content, based on events from across the oil and gas industry, that caught our eye at Pennine Petroleum Corporation.
Enjoy and share!
SEPT. 22, 2017
Romania’s OMV Petrom is investing $83.5 million US in a new drilling campaign in the Black Sea.
The oil-and-gas group plans on drilling four wells — two by the end of this year and two more by mid-2018 — up to 2,000 metres below sea level in the shallow waters of Istria block.
“Although the producing fields in the Black Sea have a production history of 30 years, they continue to provide a significant part of the group’s total production,” executive board member and responsible for Upstream Peter Zeilinger said. “The current drilling campaign is in line with our strategy to exploit the full potential of our core portfolio and to make production more efficient in order to manage the natural decline.”
OMV Petrom has exploration, development and production operations in Istria block in addition to deepwater exploration operations with ExxonMobil in Neptun Deep. The first hydrocarbons were discovered in the Romanian continental shelf of the Black Sea in 1980, with production starting in 1987.
This week’s news follows OMV Petrom’s breaking ground on a new $72-million unit at its Petrobrazi refinery in July and adding a new railway section inside the facility. That same month, OMV Group sold its Dorobantu wind park to Transeastern Power B.V. for $27.5 million, as the asset did not fit the strategic direction of the company. That sale is pending approval from Romania’s competition authority.
The group posted a net profit of $311 million in the first half of 2017, tripling year on year. OMV was sold to Petrom in 2004 by Romania, which retains 20.64% ownership of OMV Petrom. OMV holds 51%, Fondul Proprietatea 12.5% and the rest is in free float on the London Stock Exchange and the Bucharest Stock Exchange.
Plenty of potential in Bosnia's rich black gold
With an estimated 600 million tonnes of oil reserves, Bosnia could lay the groundwork to become “Europe’s cradle of black gold,” according to an analysis piece in the Andalou Agency.
The goal? Cheaper energy prices at home and revenue generated by exporting natural resources to neighbouring countries.
One way that Bosnia’s energy is on that route is the proposed Ionian Adriatic Pipeline (IAP), running from Fier in Albania to Montenegro, Bosnia to Split in Croatia. The 516-kilometre-long project has capacity to carry five billion cubic feet of gas per year. The IAP will connect to the Trans Adriatic Pipeline, a venture from Greece through Albania to Italy and Western Europe.
And exploration that began in the late 1980s is paying dividends today. After the U.S. company Amoco was awarded exclusive access to assess oil fields in the region in 1989, it was joined by Exploration Consultants Limited to conduct exploratory research.
Oil was found in the north and south of the country, but the discovery was put on hold due to the war in Bosnia. That oil now is in the Federation of Bosnia and the Republic Srpska (Serb Republic).
A find in Orasje is pegged at 180 million barrels and valued at $14 billion US.
“If BiH (Bosnia and Herzegovina) plays its cards well, it could become Europe’s source of oil. With this discovery, Bosnia, which enjoys cheap oil prices compared to other countries, could expert oil to its neighbors,” writes Nadina Ronc.
The majority of the oil-rich fields have been located in northern Bosnia at a depth of more than 600 metres, she writes. There have been positive results in 70 holes.
“In May 2017, the Bosnian government was planning to appoint a body to carry out the search for consultants that would ultimately also end up with awarding the contract to the highest bidder for exploration of oil and gas in the Federation of Bosnia,” Ronc points out.
Tenders out for projects on Krk LNG terminal
LNG Hrvatska has set a Sept. 29 deadline for bids for two separate tenders for the delivery of a Floating Storage and Regasification Unit and procurement of civil engineering works.
The work is part of a new floating terminal for storage and regasification of liquefied natural gas on the island of Krk. Earlier this year, Croatia received a $121.2-million grant from the European Union for the construction of the facility.
State-owned Hrvatska says the FSRU delivery contract includes the provision of operation and maintenance services. The other tender includes the design and construction of a jetty, connecting gas pipeline and high-pressure installations at the tk project.
Construction on the LNG terminal, set to cost $435 million, is scheduled to begin in 2019. Earlier this year, Goran Francic, CEO of LNG Croatia said first gas should flow in 2020.
“If everything goes according to plan, we will make the investment decision in the first quarter of next year, and that will depend on how the market will respond and the income needed for investment,” Francic said.
Juncker urges EU to integrate Balkan states
European Commission Chief Jean Claude Juncker continued hi s push for Europe to welcome the Western Balkans in his third annual State of the European Union Speech before the European Parliament this week.
And while his direction to open the door to the Western Balkans was clear, so was his dismissal of Turkey’s hopes of joining the EU.
“It is clear that there will be no further enlargement during the mandate of this Commission and this Parliament. No candidate is ready yet,” Juncker said. “But, thereafter, the European Union will be greater than 27 in number. Accession candidates must give the rule of law, justice and fundamental rights utmost priority.”
Romania and Bulgaria should be brought into the passport-free Schengen Agreement immediately, he said, while Croatia should be added once it meets requirements. Albania and Macedonia have candidate country status with the EU, while Montenegro and Serbia have started membership talks.
“If we want to strengthen the protection of our external borders, then we need to open the Schengen area of free movement to Bulgaria and Romania immediately,” he said. “We should also allow Croatia to become a full Schengen member once it meets all the criteria.”
EU members Bulgaria, Croatia and Romania will hold the council presidency in 2018 and 2019, the critical years of when Brexit is being negotiated.
“On 30 March 2019, we will be a Union of 27. I suggest that we prepare for this moment well, amongst the 27 and within the EU institutions," Juncker said, calling for a special summit in Sibia, Romania. “This is why I call on President Tusk and Romania, the country holding the Presidency in the first half of 2019, to organize a Special Summit in Romania on 30 March 2019. . . . It should be the moment we come together to take the decisions needed for a more united, stronger and democratic Europe.”