Energean shares experience and updates in Montenegro
As part of the preparations for the 7th Balkans Petroleum Summit, I had the pleasure to interview Antonis Nikolopoulos, Energean’s Country Manager in Montenegro. Energean has a very strong track record, holding 17 licenses across the Eastern Mediterranean, including Montenegro, Greece, Croatia, Cyprus, Algeria and many more.
In this interview Antonis discusses Energean's growth, and delves into Energean's operations in Montenegro, the country' advantages, and his experience working with Montenegro Hydrocarbons Administration.
- Energean has an extended experience in working in the Mediterranean, developing from a local producer to one of the most influential companies in the region. What were the key reasons and factors for your impressive growth and continued success?
Since we started operating in Greece in 2007, the management had a clear vision: Energean to become the leading independent E&P operator in the Mediterranean as well as a sustainable company. Started from Prinos, continued with Egypt, Western Greece and Montenegro, expanded to Israel with the big Karish and Tanin development project, became listed on the London Stock Exchange and the Tel Aviv Stock Exchange and it was in July when we announced the acquisition of Edison E&P. Post this acquisition, Energean will be operating in nine Mediterranean countries, becoming one of the biggest independent E&P’s in Europe, aiming at producing around 150,000 barrels of oil equivalent per day in 2021. Approximately 80% of our production as well as our more than 600 million barrels of oil equivalent 2P reserves will be gas.
We have the vision, we have stayed focused on the Med, we are committed to the sustainable development of the natural resources of the region and connect the discoveries with the European markets. We have been investing not only in projects, but also in dedicated and highly skilled professionals and we have never forgotten that safety for the people and the environment always comes first. Moreover, we have been trying to be part of the daily life of the local societies we operate in and in that context we participated in the cleaning of the beach of Bar and the seabed of the Marina Bar along with the Municipality of Bar, the Administration of Marina Bar, the NGO “Ozon”, the Južno More Dive Team, the pupils of "Blažo Jokov Orlandić" elementary school and residents and workers of the area.
I guess this was Energean’s recipe to succeed!
- In 2017, Energean invested in Montenegro by acquiring offshore blocks 4219-26 and 4218-30. Which reasons lead you to invest in Montenegro? What are the country’s key strong points?
The eastern Adriatic remains substantially underexplored, despite having what appears to be all the necessary hydrocarbon-generating components in place as well as the western offshore Adriatic having been a prolific hydrocarbon-producing province for over 50 years for both oil (Italy) and biogenic gas (Italy and Croatia).
The widespread distribution of seeping and oil shows in the region indicate the presence of an active petroleum system. Large prospects and leads, comprising Cretaceous age carbonate reservoirs, have been identified in offshore Montenegro. These are on a par with recent oil discoveries in northern Albania, such as the onshore Shpirag-2 discovery. To date, over 5 billion barrels of oil in place have been discovered in Albania within this prolific carbonate play.
In addition to the carbonate oil play, the Tertiary age sandstones in offshore Montenegro are considered highly prospective for biogenic gas. The biogenic gas play is prolific in the Po Basin of offshore northern Italy/Croatia, where over 30 TCFGIP have been discovered to date. The play has been proven in the Duresi basin offshore Albania and Italy, but to date only limited exploration drilling has been carried out in offshore Montenegro.
In Montenegro, initial exploration activity took place from 1949-1966. Further than that, one nearshore and 3 offshore wells were drilled between 1975 and 1991. The JJ-1 well (TD at 4,700 metres) found significant quantities of natural gas within the clastic deposits of the Oligocene. The JJ-3 well recovered 183bbls of oil from Cretaceous age carbonates. Additional offshore wells had significant gas shows in Lower Tertiary sands, but were not tested.
These offshore wells are not considered to have been fully tested for the potential of the carbonate structures. New state of-the-art 3D seismic acquisition and processing should enable new prospects and leads to be identified and drilled that were previously unrecognized.
Further than that, Montenegro is a safe country that gravitates towards the European Union, with a strong will to develop its assets, increasing geopolitical significance and set to become a factor of stability for the Balkans and the wider region.
- Energean’s prospects at Blocks 26 & 30, are combined best estimate unrisked prospective resources of 143.9 mmbbls of hydrocarbons liquids and 1,766.1 Bcf of gas. In February 2019, Energean proceeded with the acquisition of a new 3D seismic survey, which was completed in record time. What were the results of the survey?
Energean commissioned PGS for the acquisition of a new 3D seismic survey over the two exploration blocks. The PGS Ramform Titan, one of the best seismic acquisition vessels in the world, deployed 14 geo-streamers, 6.5km for each streamer length, using a triple source array to cover a total area of 338km2 .
The seismic survey started on the 8th of February 2019 and encountered good weather throughout achieving less than 5% downtime. The survey was completed on the 20th of February with an excellent HSE record achieving good quality 3D seismic data
We are in the process of interpreting the data acquired, so we are not yet ready to provide details and decide on our next steps in the area.
- For the past few years, Energean has been working with Montenegro Hydrocarbon Administration. How has this partnership influenced the success of your operations?
So far, working with the Montenegro Hydrocarbon Agency and the Montenegrin Administration has been a great experience and led to a fruitful collaboration. Despite the fact that this was only the first international licensing round Montenegro has ever proceeded with, we are really impressed by the professionalism, the devotion and the will to improve the process demonstrated by the staff we have been collaborating with.
We have not faced bureaucratic issues and what really helped a lot was the fact that representatives of the Montenegrin administration and the Mayors of Bar and Ulcin too visited Kavala and Prinos, the area we operate in Northern Greece. This helped them a lot to understand how a whole city is influenced by the E&P operations and maximises the benefits that have been occurring from them as well as to realise that this activity has been developed in harmony to the environment, the tourist activity, the fishery market and the daily life of the local communities.
- Who are you looking forward to meeting during the 7th official Balkans Petroleum Summit?
The Balkans Petroleum Summit is a well-established institution in the context of which officials from the E&P sector in the Balkans as well as Operators and other companies have the chance to meet and exchange views about how the sector should be developed in the years to come, as well as to locate opportunities for further expansion.
Montenegro hosts the Summit for the first time, but I have to say that I expect a very interesting conference. Not only because there are ongoing exploration programmes in the country, but mostly because of the need for the participants to convey a clear and strong message that the E&P sector has entered the era of the energy transition and that E&P companies such as Energean are committed to UN’s Sustainable Development Goals – a crucial choice for the development not only of our businesses but for societies as well.
I expect that the 7th Balkans Petroleum Summit will provide a solid basis for new collaborations between companies and administrations from the Balkans and the Med and will convince the organisers and the participants to consider Montenegro as a key country for the future development of our industry.
Find out more about operating in the Balkans first-hand from Antonis Nikolopoulos by attending the 7th Balkans Petroleum Summit and hearing from Energean, Montenegro Hydrocarbon Administration, and all major operators.The 7th Balkans Petroleum Summit is the Official Summit for the hydrocarbons industry of the Balkans. The summit takes place in Hotel Maestral, Budva Montenegro. Register here.