Bosnia’s Muslim-Croat federation government signed a preliminary deal on Thursday with Royal Dutch Shell’s Shell Exploration Company to survey potential natural gas and oil fields.
The federation government has revived exploration plans made before Bosnia’s 1992-95 war, when research revealed the potential for oil in the north and south.
Government officials, who also want other foreign companies to help tap potential energy reserves, said oil and gas exploration was strategically important for a region that imports most of its crude from Russia.
“The government is determined to intensify economic development and attract foreign investment into hydrocarbon resources, in which Shell, in particular has vast experience,” it said in a statement.
Under the deal, Bosnia’s largest engineering group, Energoinvest , the local partner in the original project, will hand over all documentation related to pre-war research to Shell to help the company conduct initial screening.
The government said that Shell would provide expertise and equipment to help determine the extent of any fossil fuel reserves and whether it would be profitable to tap them.
If the research proves promising, drilling is expected to start in 2013, although Energy Minister Erdal Trhulj has said there may be a tender for rights to exploit the fields.
Meanwhile, Jadran Naftagas, a joint venture of Russia’s Neftegazinkor, a unit of state-owned Zarubezhneft, and Serbian oil firm NIS, on Thursday started exploration of potential oilfields in Bosnia’s other autonomous part, the Serb Republic.
The company will conduct a geological and seismic survey in which it will invest $41 million after it won a 28-year oil exploration concession from the Serb Republic government.
