Government Awards 5 Companies Adriatic Oil & Gas Exploration Licences

During a sitting on Friday behind closed doors, the Croatian government has selected five companies which will receive licences to explore and exploit oil and gas in Croatia’s Adriatic sea…

U.S-based Marathonoil, Austria’s OMV, Italian multinational ENI, London-based Medoilgas, and INA, owned by the Croatian government and Hungary’s MOL, have all been awarded licences today after submitting bids during last year’s tender, which consisted of 29 block areas, ranging from 1,000 – 1,600 square kilometres, eight in the northern part of the coast and 21 in central and southern Dalmatia.

10 licences in total have been issued – with 7 of those going to a consortium of Marathon Oil and OMV. INA were awarded two licences, whilst one went to a ENI / Medoilgas consortium. Negotiations now will take place between the Croatian government and the companies approved today with exploration contracts expected to be signed by April this year. The contracts are expected to include 5-year concessions to explore, and 25-year concessions to exploit.

Croatia’s Minister of Economy Ivan Vrdoljak says that 100 million kuna will be paid to the government immediately once the contracts are signed and that the total value of the investment is around 4 billion kuna.

With Croatia heavily reliant on tourism, local and international environmental groups have launched campaigns to try to stop drilling in the Adriatic. Public debate will continue, and one of those groups strongly against it is the Clean Adriatic Sea Alliance (CASA), a united group of citizens for preservation of the Adriatic Sea, who have responded by launching a petition to try to stop the action.