Albania to sell state oil firm, offer oil blocks

NG Energy International

17/03/2015 13:48

* Albania to sell state oil firm this year-PM 
    * Investors will be offered new exploration blocks 
    * Albania says has 40 million tonnes of easily extractable 
oil 
 
    By Benet Koleka 
    TIRANA, March 17 (Reuters) - Albania wants to try again to 
privatise its state oil company  this year, and will soon begin 
offering its blocks for oil and gas exploration, Prime Minister 
Edi Rama said on Tuesday. 
    The previous Democratic Party government, which Rama's 
Socialist-led coalition ousted in June 2013, cancelled the sale 
two years ago to a private buyer. 
    "We will end the long-drawn process of the privatisation of 
the state-owned Albpetrol company this year," Rama said. 
    "Since the very first day, it was clear to us Albpetrol was 
an anachronism and a hybrid that could not meet the challenges 
of the future," he told oil executives.  
    His audience included representatives of Shell, already 
active in Albania, Exxon Mobil  XOM.N , BP  BP.L , Italy's Eni 
 ENI.MI , Austria's OMV  OMVV.VI  and Croatia's INA. 
    Albpetrol is an upstream company only, having sold its oil 
refinery four years ago. 
    Wooing investors, Rama said the government was determined to 
"secure a favourable regime for the exploration and development 
of oil and gas", including stabilizing fiscal clauses for the 
duration of contracts. 
    Oil and gas reserves are estimated to amount to 400 million 
tonnes, of which 40 million are easily extractable, Energy 
Minister Damian Gjiknuri said. 
    Thirteen onshore and offshore blocks can be explored for oil 
and gas, Rama and Gjiknuri said. "Very soon we shall start 
procedures to give the first three blocks for exploration to 
interested companies," Gjiknuri said. 
    Albanian law offered attractive fiscal terms during the 
exploration period, exempting companies from paying Value Added 
Tax, extending the research period from 5 to 7 years and the 
production time from 25 to 30 years, Gjiknuri said. 
    Shell  RDSa.L  and Calgary, Canada-based Petromanas Energy 
Inc  PMI.V  already operate a well offshore Albania and have 
said test flows found oil and gas, but are yet to establish its 
production capacity. 
    The well is across the Adriatic Sea from Italy's offshore 
Val d'Agri field which pumps around 85,000 barrels per day. 
 
 (Editing by William Hardy) 
 ((Benet.Koleka@thomsonreuters.com; +355 4 222 98 24 ; Reuters 
Messaging: Benet.Koleka.reuters.com@reuters.net)) 
 
Keywords: ALBANIA OIL/ALBPETROL