Energetics news

INA awaits new exploration concessions in Croatia

20 DECEMBER ,2017
Stefanija Novak Zoroe
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After a six-year standstill in launching public tenders for exploration blocks in Croatia, INA is readily awaiting the new Hydrocarbon Exploration & Production Act which will open the door to new tenders for concession awards. INA is interested in independent exploration of Northern Croatia, and in pursuing exploration of the Dinarides, and unconventional projects together with partners.

The priority and the strategic goal of INA is reserve replacement and increase. Therefore, the company intends to participate in all exploration activities in Croatia which its experts evaluate as prospective and where positive economics can be expected. In addition, INA intends to increase its activities in existing Northern Adriatic concessions.

The main activities/work plan of the new Operating Director of INA Exploration & Production, Tvrtko Perković and his team will be focused on: oil and gas reserve replacement and increase, an expert and realistic review of potential reserve growth in Croatia, new partnerships and acquisitions internationally, EOR projects in the mature Pannonian fields, continuation of 4P programme – increase in hydrocarbon production and reserves in existing oil and gas fields onshore Croatia, exploration risk diversification, occupational health and safety and environmental protection, and, naturally, positive economic results.

This, among other things, could be heard at the Assembly of the Croatian Association of Petroleum Engineers and Geologists held on 20 December 2017 where Tvrtko Perković gave a talk on the “CHALLENGES IN DEVELOPING INA AND EXPLORATION & PRODUCTION“.

Financial stability, low debt/equity ratio and large investment potential of INA, together with commitment to further business development, will result in long-term company development in the future, with Exploration & Production, as its key driver.

Domestic hydrocarbon production is carried out by almost 600 active wells located in 37 oil and 18 gas onshore fields and 11 Adriatic gas fields. Being aware of natural production decline, average field age of over 40 years, and high maintenance costs, INA experts have continually invested in the revitalization of mature fields, but it is not enough to compensate for the natural production decline and replace oil and gas reserves.

As regards potential reserve growth in the Croatian territory, one can hardly expect large discoveries that could reverse the present situation and compensate for the entire production decline and bring back the golden years of INA production. It has to be mentioned that only 13 percent of total INA reserves have been discovered since 1990. Until 2009 exploration in Croatia was considered as unpromising, in 2010 INA faced financial crisis, and in 2011 exploration concessions were revoked unfoundedly. It was definitely an act that was harmful for the economy in general. In 2014 new physical plans for the counties were adopted, and INA had significant problems in obtaining location permits for production projects. The first tender for exploration concessions was opened in 2016 and INA was awarded concessions on one onshore block (Drava-2) and two Adriatic blocks (25 & 26).

Besides ambitious projects in Croatia, INA also wishes to focus on international investments. Today production from international concessions accounts for only 6 percent of the total INA hydrocarbon production. This figure would, certainly, be much higher if INA could return to Syria. INA holds 4 onshore concessions in Egypt and 2 offshore concessions in Angola. The focus od INA’s interest is on profitable exploration projects and acquisitions of producing and development fields which could provide new reserves or increase hydrocarbon production, in Northern Africa, Middle East and Europe, like Ukraine where Crosco has been active with three drilling rigs. Possible return of INA to Iran and new partnerships in Egypt are also being investigated.

Investments in new exploration concessions in Croatia and internationally, continuation of mature fields revitalization, new EOR projects, acquisition of producing and development fields internationally, partnership and risk diversification are the strategic goals of INA Exploration & Production headed by the new Operating Director Tvrtko Perković.

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