site.btaAgreement on Oil and Gas Exploration at 1-14 Silistar Block Signed

Agreement on Oil and Gas Exploration at 1-14 Silistar Block Signed

Sofia, February 23 (BTA) - Energy Minister Temenouzhka Petkova and Eileen Wilkinson, Regional Vice President of Shell Exploration and Production B.V., signed an offshore oil and gas exploration agreement for the 1-14 Silistar Block in Bulgaria's Exclusive Economic Zone in the Black Sea, on Monday. The agreement was signed in the presence of Prime Minister Boyko Borissov.

Shell will invest 18.6 million euro in the exploration activities and will pay 4.9 million euro to the state, which
will be contributed to the state budget, Minister Petkova said at the signing ceremony.

Wilkinson noted that the company marks the 25th anniversary of setting a foothold in Bulgaria. She recalled that Shell has a 30-year experience in carrying out such activities around the world. The company's main values involve not inflicting damage on people and the environment, Wilkinson stated.

The licence allows to make an assessment of the oil and gas potential, she also said adding, however, that before starting they will get familiarized with the regulatory framework in order to operate correctly. She thanked the Prime Minister for acting as host to the ceremony and the Energy Minister for the
efforts to finalize the agreement.

On her part, Minister Petkova said that this is a special day for the Bulgarian energy. "By signing the agreement we make an important step towards achieving one of the main priorities in the energy sector - diversification of the natural gas sources," she observed.

The first drilling at the Han Asparouh Block will be carried out by mid-2016. The agreement with the company has been signed for a term of five years with a possibility for two extensions by two years, said Petkova. The company should obtain all necessary permits and pay the bonus and the exploration activities may start only then. The prices for end consumers will be determined by the market but there should be different possibilities for gas supplies in order to have an operational market, she commented.

Taking a question, Wilkinson said that the agreement also carries commitment to social programmes, from which the respective regions will benefit long after the end of the company's operations there.

By the signing of the agreement with Shell Bulgaria confirms that it works actively on the diversification of the natural gas supplies, Borissov said after the signing of the document. The Prime Minister voiced conviction that the deposits will be good and this will give huge advantages to the Balkan gas hub in the future. Five to six gas sources will be added to the Bulgarian gas transmission system, he observed adding that Bulgaria has considerable interest in this because of the transit fee revenues.


All procedures have been carried out with maximum transparency, said Borissov adding that "when procedures are conducted properly, this attracts investors and this is how Bulgaria will work in the future".