* Government to issue tender for consultants
* Deal expected to be signed at end of 2014
* Investment expected to $300 mln-$700 mln
By Daria Sito-Sucic
SARAJEVO, Dec 2 Bosnia's autonomous Muslim-Croat
Federation expects to start talks in late February with a unit
of oil major Royal Dutch Shell on a concession for oil
exploration, a minister said on Monday.
The talks with Shell Exploration Company, which start only
after the government has picked consultants, are expected to
last up to nine months, Federation Energy Minister Erdal Trhulj
"Bearing in mind the extent of the possible deal, we would
be able to sign a contract awarding the concession to Shell at
the end of 2014," Trhulj said. "This is an enormous endeavour
that has never before been conducted in Bosnia.".
The investment will range between $300 million and $700
million depending on the number of drilling sites, he said.
After the 1992-95 war, Bosnia was split into two autonomous
regions, the federation dominated by Muslim Bosniaks and Croats,
and the Serb Republic. Each has a right to use natural resources
on its soil without consulting the other region.
Before the war, U.S. and British researchers identified five
potential oilfields in the Muslim-Croat Federation and possibly
as many in the Serb Republic.
The federation government approached Shell in 2011 after
deciding to revive oil and gas exploration plans based on the
A two-year preliminary deal signed in November 2011 tasked
Shell with developing a data room.
In September this year, Shell expressed interest to get a
concession in three areas containing possible deposits, but the
government agreed only to a concession in the Dinaridi area,
stretching from the town of Bihac in the west to the Adriatic
town of Neum in the south.
Experts say that southern deposits, located at a depth of
4,000-8,000 metres, could contain up to 500 million tonnes of
oil reserves, while northern beds are estimated at around 70
The Serb Republic in 2011 awarded a concession for exploring
potential oilfields to Jadran Naftagas, a joint venture between
Russia's Neftegazinkor, a unit of state-owned Zarubezhneft, and
Serbian oil firm NIS, majority-owned by Russia's Gazprom Neft
The company started drilling last June as part of a $41
million investment in the first exploration phase but has so far
reported no significant findings.