Repsol Quits Bulgarian Block
Spain's Repsol has ceded its 30% share of an offshore Bulgarian oil discovery after eight years of field work, the Bulgarian government said in a statement on June 10.
The company, together with Total and OMV, secured a licence to the Black Sea's 1-21 Han Asparuh block in 2012. The group drilled their first well there in 2016, striking oil. Two more wells followed, but the partners have not disclosed any resource estimates for the find.
As a result of Repsol's withdrawal, Total's share in the project will rise to 57.1%, while OMV's will increase to 42.9%, the government said. The remaining investors' licence has also been extended by two years until May 15 2022, it said.
"During the two-year extension, additional geological and geophysical works and seismic surveys worth a total of €3.3mn ($3.8mn) will be carried out," the government said. It did not mention any further drilling plans.
Repsol is among many international oil companies making deep spending cuts and divestments to shore up their financial position. The company reported a €487mn net loss in the first quarter on impairments.
Bulgaria, like other Black Sea littoral states, has sought to develop offshore resources to lower its dependency on oil and gas imports, most of which are supplied by Russia. But hopes of establishing a key centre for oil and gas production in the Black Sea have not materialised.
The 14,220-km2 Han Asparuh block lies in waters up to 2,200 metres deep. It neighbours the Neptun Deep block in Romanian waters, where OMV and its partner ExxonMobil have found up to 84bn m3 of gas. OMV is yet to take a final investment decision on the project, though, citing regulatory uncertainty in Romania, while ExxonMobil is seeking to sell its stake as part of a total withdrawal from Europe's upstream sector.
OMV's Romanian subsidiary OMV Petrom agreed to buy its parent's 30% stake in Han Asparuh in December, and the deal had been expected to close by mid-2020. Han Asparuh is also situated next to another block called Tervel, which the government is courting investors to explore. Shell, Repsol and Woodside Petroleum are also exploring the nearby Silistar block which is also Bulgaria's, but drilled a dry well there last year.
Meanwhile, Ireland's Petroceltic is flowing small quantities of gas at a group of fields at Bulgaria's Galata block, but has had difficult with falling production rates.