Shell Signs Five-Year Deal for Black Sea block
Shell is set to explore for oil and gas in the Black Sea, off the coast Bulgaria, following the signing of an agreement between the company and the Bulgarian government.
In a press release on Bulgaria's government website, released February 23, the government said that a contract for gas and oil exploration for Block 1-14 (also known as the Silistar block) had been signed by Bulgaria's Minister of Energy, Temenuzhka Petkova, and Vice President for Middle East and North Africa exploration at Shell International Exploration and Production Eileen Wilkinson. The exploration licence is granted to Shell for a period of five years.
The signing completes an agreement made in September 2015 between the two sides to begin exploration on the 7,000km Silistar block. Exploration is expected to begin within the next 18 months.
According to the government press release, Shell will invest €18.6mn in the exploration activities.
Bulgaria has been working to attract more investors in oil and gas in recent years as well as to diversify its sources and transit routes for gas and oil. Last month, Bulgaria's Prime Minister, Boyko Borisov, told German media that Bulgaria is aiming to become a regional gas hub and is working with the EU to review the feasibility of that aim.
Its major gas infrastructure, the Interconnector Greece-Bulgaria (IGB), is also progressing steadily, having recently invited shippers and transmission system operators to express interest in using the pipeline.
Currently, Bulgaria is largely dependent on Russia to meet its gas needs. On the signing of the agreement between Shell and Bulgaria today, however, Borisov was positive the country's efforts were paying off.
"Now nobody can say that Bulgaria is not working actively to diversify its supplies of oil and gas," he said.