ECONOMY

Energean Oil and ELPE land the first oil deals

The two consortiums led by Energean Oil and Hellenic Petroleum (ELPE) have won the tenders for the research into and utilization of hydrocarbons in the areas of Ioannina and the Gulf of Patra in western Greece, the Environment and Energy Ministry announced late on Thursday in what is the first decisive step toward the commercial use of these reserves.

According to the ministry, the revenues expected from these two regions in the next 25 years will amount to some 11 billion euros in what is the first reserve to be exploited in Greece since the Prinos field in northern Greece was located in the 1970s.

A ministry committee submitted a unanimous proposal to the minister for the land area of Ioannina to go to the consortium comprising Energean Oil and Petra, and for the sea area in the Gulf of Patra to go to the consortium made up of ELPE, Edison and Petroceltic. Energean Oil is the Greek company that operates the Prinos reserve and was recently the target of investment by US fund Third Point.

In the next few days the ministry will invite the consortiums to proceed with the final draft and signing of the concession contracts.

Minister Yiannis Maniatis spoke of a new era in the Greek hydrocarbon market and stated that there will soon be an announcement concerning which other regions will be up for international tender, as major oil companies have already expressed a major interest.

Meanwhile the first results from the seismic surveys by Norwegian company Petroleum Geo-Services (PGS) in the Ionian Sea and south of Crete have created some reserved optimism for the location of hydrocarbon reserves. Experts say it is too early to reach any safe conclusions over whether there are any reserves worth extracting and that in any case drilling cannot be expected to start before 2016, with utilization not seen before 2020.

Notably, the statement issued by PGS yesterday said that “until recently the region did not garner much attention, but given the enthusiasm and the expectations of other fields in the Mediterranean, this region that constitutes the object of the next round of concessions is showing great potential.”

Earlier reports pointed to the interest expressed by major names in the oil industry such as France’s Total and US giant ExxonMobil, along with Delek from Israel and Statoil from Norway.

PGS will have completed the processing of the data collected by the end of the year, so that in early 2014, Athens will be able to divide the region into blocks and announce the tenders.