Croatia, Montenegro working together to reach Adriatic oilfields

02/07/2014

The effort to drill for oil and gas could stimulate the economy and attract foreign investment.

By Kruno Kartus and Drazen Remikovic for Southeast European Times -- 02/07/14

photo

Officials believe that they will be successful in drilling for oil and gas in the Adriatic. [AFP]

Croatia and Montenegro are working together to explore for oil in the Adriatic Sea, making both countries more attractive to energy investors and potentially giving a boost to the regional economy.

"We focused discussions on what is most important: oil and gas exploration in the waters of the Adriatic. We agreed to do everything so the research starts as soon as possible, and that the border line does not stand in the way," Croatia Prime Minister Zoran Milanovic told reporters after a meeting in June with Montenegro's prime minister, Milo Djukanovic.

Officials predicted that the border will not be a problem and it will not affect the exploration and recovery of oil and gas. Co-operation between the two countries is a result of the exchange of information and experiences between them, officials said.

Croatia's Ministry of Economy earlier this year issued an international tender for the exploration and exploitation of hydrocarbons in the Adriatic.

"The geological potential is great, but it would be foolish to talk about any reserves until all research actions are complete, which will determine the amount of the oil and gas reserves," Tomislav Cerovec, a spokesman for the ministry, told SETimes.

Barbara Doric, head of Croatia's hydrocarbons agency, said about 40 companies have expressed interest in the project since March.

"The geological potential of Croatia suggests that possible gas deposits exist in the northern Adriatic, while the central and southern part of the Adriatic have possible oil deposits. The interest is great, if judged by the attendance of companies,'' Doric told SETimes.

On May 15, Montenegro conducted its first public call for oil and gas exploration in its undersea area. Six companies submitted bids for the effort.

Registered companies have expressed interest to explore in one of the so-called 13 blocks of a total area of 3,000 square kilometres in the southern and eastern part of the Montenegrin sea floor.

By the end of the year, negotiations with each company are expected to finish and exploration will begin. The tender predicts that Montenegro will earn 65 percent of the total revenue from the eventual discovery of oil and gas.

From 1950 to 1991, companies drilled 17 exploratory wells in Montenegro for gas and oil. According to government data, the most significant potential was determined in Ulcinj, and in the water near Kotor bay on the border with Croatia.

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That is why Djukanovic said that the two countries will work together and help each other when it comes to oil and gas exploration.

"The governments of Montenegro and Croatia traditionally cherished the practice of good neighbourly relations, as evidenced by the fact that there are almost no areas where we do not co-operate," Marina Zivaljevic, spokewoman of Ministry of Economy of Montenegro, told SETimes.

"When it comes to the project of oil and gas exploring in the Adriatic, the two governments agree that in the spirit of good co-operation, they will use their natural resources in an economically viable manner. The willingness to co-operate also confirms a joint participation in a project which is very important for the entire region -- the construction of Adriatic Ionian pipeline project AII (IAP)."

How can co-operative efforts improve the region's economy? Add your thoughts in the comment field below.

This content was commissioned for SETimes.com.
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