Croatia launches second onshore license round
ZAGREB, Croatia -- Croatia has launched the country’s second onshore license round offering seven onshore blocks all located in Croatia’s prolific Pannonian basin. This is the second of three planned onshore license rounds.
The President of the Croatian Hydrocarbon Agency, Marijan Krpan stated, “The seven exploration blocks offered in this license round are located in Croatia’s highly prolific Pannonian basin. The total acreage available is 14,272 km2. The available blocks range in size from 1,361 to 2,634 km².
Croatia’s Pannonian basin is well-known and has a long history of producing oil and gas fields. Areas of the basin, including the available acreage, remain underexploited with respect to new pools or missed pay opportunities. Preliminary analysis of the seismic and other available data confirm that the available acreage contains significant remaining potential.”
Work period
Licenses for hydrocarbon exploration and production are granted for a period of up to thirty years. The exploration period is five years. The work commitments need to be bid according to the two exploration phases. The first phase is three years and the second phase is two years. The exploration period, at the request of the investor, can be extended two times for a period of six months per extension. In the case of commercial discovery, the exploitation period is 25 years. The exploration period may last up to five years and it may, at the request of the investor, be extended up to two times for a period of six months per extension.
This bidding round requires from bidders to base their bids on the division of the exploration period into two exploration phases – the first of which lasts three years, and the second of which lasts two years.
Upon the expiry of the first exploration phase, the investor is required to relinquish 25% of the exploration block. Upon the completion of the second exploration phase, the investor is required to relinquish any areas that have not been declared exploitation fields.
Government support
Croatia created conditions for large investments in exploration and exploitation. At Croatia’s 1st Onshore License Round opened in July 2014, six onshore exploration blocks were offered, covering area of Drava, Sava and Eastern Slavonia. Upon closing of License Round the Croatian Government awarded licences to INA-INDUSTRIJA NAFTE Ltd., a Croatian company, and Canadian company Vermilion.
To further streamline bureaucracy and remove obstacles to investment, the Government of Croatia earlier this year implemented a new hydrocarbon act. The new hydrocarbon act was necessary to usher in a new era of hydrocarbon license rounds which is beginning with this license round and will continue with an upcoming license round for blocks along Croatia’s Dinarides thrust belt.
With forthcoming licensing round for Dinarides, new improved pro-investment law, excellent existing oil and gas infrastructure and with ongoing new ones, Croatia will definitely increase its competitive advantage in this region.
