Croatia Onshore Licence Round Closes with Success

On 18th February 2015 Croatian Economy Minister Ivan Vrdoljak announced that seven bids had been received during his country’s first onshore oil and gas licensing round. The 6 blocks on offer covered the Drava river basin to the north and further areas to the east of the country. The high level of interest in these blocks suggests that a second round may be opened in the near future.

This onshore license round followed a similarly successful bidding exercise in the Adriatic Sea which forms part of Croatia’s drive to revive its economy through energy security and international investment.

The Pannonian basin is one of the most important onshore oil and gas producing provinces in central Europe with one of the deepest sedimentary sections. Geologically the area is comprised of Miocene clastic sediments that have been deposited over an irregular Mezosoic – Paleozoic basement in Marine through to brackish and lacustrine conditions of lake Pannon. The region has well proven source rocks of Badenian age, reservoirs within the Badenian, Pannonian and Pontian and seal provided by thick marl deposits through the Pannonian to Pontian. Structural plays have been extensively tested in the basin but stratigraphic potential is all but untouched.

The Croatian area of the basin covers an area of roughly 26,000 km and has around 59 producing fields. The region has a long history of hydrocarbon exploration with oil first being extracted in 1856. However the basin has recently suffered from a decline in production from a peak in 1982. In 2014 Spectrum undertook a regional reprocessing project to support two licence rounds onshore. The first of these covering the East of the country that has just closed, with suggestions of a second round in the Western area towards the middle of the year.

Bidders were not named but Mr. Vrdoljak reported they they included “very serious companies”. He said, “This is just the beginning. We have more potential for exploration in northern and central Croatia, particularly in the Dinarides,”.