Georgi Velev
georgi.velev@klassa.bg

The Scottish company Melrose Resources has suspended its search for oil and gas off Cape Galata near the city of Varna because it remained without authorisation to implement this activity, became clear from the documents signed by Deputy Minister of Economy, Energy and Tourism, Marii Kosev, which were at the disposal of Klassa. The company, acting as concessionaire of the Galata gas depository, was notified with a letter of Minister of Economy, Energy and Tourism (MEET) to leave the area by the end of February. The reason was that the contract had expired.

As early as the end of last year, Melrose Resources PLC sent a letter requesting the extension of the concession but no response was received within the set time limit. The company also sent its request to the Ministry of Environment and Water which replied positively. This opinion was mailed urgently to the Ministry of Economy, became clear from the documents. The first exploration permit was granted three years ago with the option for the deadline to be extended twice by two consecutive years. Pursuant to the amendments to the Subsurface Resources Act, exploration permits are now issued solely by MEET. Klassa referred the controversial issue to MEET but no response had been received by the time Klassa went to press. Deputy Energy Minister, Marii Kossev, was also not available for comment. He confirmed to the online edition 3e-news.net the news that a deadline extension had been refused to Melrose Resources PLC and explained that he had been misled by his employees that the exploration permit could not be extended and he will now try to clarify the situation.

The Scottish company is the only company involved in natural gas extraction in Bulgaria, while its annual gas output stands at about 400 million cu m, constituting about 20% of total consumption in the country.
If the company had been authorised to deal with gas exploration, new gas fields could have been discovered in the region and the rate of local production could have been increased, commented for Klassa, Hristo Kazandjiev, former director of Natural Resources and Concessions Directorate with the Economy Ministry. He hopes that the current pace of gas extraction will continue, regardless of the suspended exploration and the used infrastructure of Galata. According to Kazandjiev, during its three-year operation in Bulgaria, Melrose Resources PLC has invested nearly $100 mln.