Federation BiH (Bosna & Herzegovina) searches for oil reserves

Federation BiH (Bosna & Herzegovina) searches for oil reserves

The government of the Federation of BiH signed a contract with the world giant in the field of energy sector consulting, IHS Global from London, which was selected via an international tender as an expert consultant company. They will help BiH authorities to prepare a tender for the award of a concession for the exploration and exploitation of oil and gas in the BiH.

With the signing of the Contract and the assignment of work to the British, the first phase of the “race for black gold” has already started in the territory of Bosnia and Herzegovina. Earlier research has shown that the largest sites are hidden in the area of the Dinarides and the Tuzla basin.

Although the selection process of the consultant lasted almost three years, Federal Minister of Energy and Mining, Nermin Džindić, told local media that F BiH for first time implemented the project of oil and gas exploration through the concession. He added that the exploration for these energy products is very complex, financially demanding and very risky, especially taking into account the degree of investigation that exists of these areas in relation to other countries, in the region and wider.

“However, the current geological data and their analysis again show the existence of economically interesting reserves of oil and gas,” Džindić said.

He explained that the research project, and hopefully, the exploitation of oil and gas, will take place for the first time in this area by awarding a concession, or by signing a contract with oil companies granting a concession for the exploration and exploitation of oil and gas in certain blocks in the Federation of BiH.

“The company that signs the contract will carry out investigative actions in the territory of the Federation of Bosnia and Herzegovina and will determine the existence of economically interesting reserves for exploitation,” said Džindić.

According to him, numerous decisions of the Government of the Federation of BiH have been adopted, as well as the regulation and other laws in order to create a legal basis for the realisation of this complex project.

“The very important factor that insures the Government of the Federation of BiH is the existence of a legal framework, which includes the prescribed minimum elements of the content of the contracts, fees and other fiscal obligations for the concessionaire, as well as the issue of controlling the produced quantities of oil and gas, which the Government of the Federation of BiH had to provide before preparing a public call to interested oil companies,” said Džindić.

If, as he says, they find economically profitable deposits of oil and gas in the territory of the Federation of BiH, the final agreed contract should be in effect for a period of 25 years, to the satisfaction of the Federation of BiH and foreign oil companies.

Oil company Shell, which was interested in oil exploration in the FBiH four years ago, intends to invest $ 700 million in research. They announced that one deposit could cost up to $ 75 million.

However, four years ago, they withdrew from negotiations with the FBiH Government, although they had signed an agreement. They justified this by the fact that they were turning to new sites in Europe and that BiH did not interest them anymore./ibna