Greek oil firm Energean Oil & has signed an exploration and production concession contract with Montenegro covering offshore blocks 4219-26 and 4218-30.
To remind, the company had reached an agreement over the blocks in mid-2016, however the deal had to be ratified by the Montenegro government.
Following approval from the Parliament of Montenegro, the final contract was signed by Dragica Sekulic, Montenegro’s Minister of Economy, and Mathios Rigas, Chairman and CEO of Energean Group, at a ceremony on Wednesday in Podgorica.
Total investment over an exploration period of seven years will be $19 million, including the funding of a new 3D seismic survey, geophysical and geological studies, and the drilling of one well.
The two blocks are located offshore at a water depth of 50-100 meters, close to the Montenegrin coast in the vicinity of the town of Bar. Energean plans to begin the 3D seismic acquisition during the first quarter of 2018.
The Eastern Adriatic has been substantially underexplored to date, despite having similar geology to the wider Adriatic Zone, which is well known for its prolific hydrocarbon systems in Italy, Albania and Croatia, and has been a significant oil and gas producing region for over 50 years, Energean said.
This latest announcement further underpins Energean’s commitment to seeking to open up the oil and gas opportunities in this highly promising territory, the company added.
Energean CEO, Mathios Rigas said: “I am delighted to sign this Concession Contract, which marks a significant day for Energean and our continued growth, as we enter the highly promising Adriatic region. Whilst a number of major oil and gas companies left the area during the period of sustained low oil prices, Energean remained committed to pursuing the development of the region, and is now extremely well placed to take advantage of this commitment and focus.
“We believe the geology to be similar to that in Western Greece, where we have been exploring since 2014 (onshore Ioannina), have a Field Development Plan in progress offshore West Katakolo, and are ready to sign a new contract for a further block (onshore Aitoloakarnania).
“Furthermore, our strong track record of operating in environmentally sensitive areas, successfully operating the Prinos oil field in Northeastern Greece, which has been producing oil since 1981, ideally places us to drive through this project for the benefit of the local economy and Montenegrin people.”