Melrose to Pour Millions in Bulgaria, Romania in 2010

Melrose expects its expenditure in 2009 to be around USD 165 M, slightly lower than market estimates, and forecasts preliminary capital expenditure of USD 195 M for 2010. File photo

The UK company Melrose Resources announced plans to invest USD 195 M next year, 60% of which in development activities in Bulgaria and Romania and the rest in exploration and farm-in activities in the two countries and Egypt.

Meanwhile the Edinburgh-based oil and gas firm confirmed it is negotiating with the recently-elected Bulgarian government about a scheme to use Galata for gas storage.

The Scottish The Herald newspaper cited Chief executive David Thomas as saying that scheme was proceeding more slowly than directors had hoped.

However, he added: "There are absolutely no issues regarding the strategic requirement for it."

Thomas said following drilling successes in the first half, Melrose increased the mid case reserves estimates for three finds off Bulgaria to 100 billion cubic feet gas. Only 66bcf has been produced from Galata.

The company is also pursuing plans for its recent Kavarana and Kaliakra gas discoveries and various other exploration prospects on the Galata block on a geologic trend running east from the Galata field.

The two discoveries will be developed via subsea wells tied-back to the Galata platform, with export via the existing offshore pipeline and onshore processing plant. Melrose also will facilitate tiebacks of any future discoveries.

Kavarna, around 7 km (4.3 mi) east of Galata, holds an estimated 24 bcf of reserves. First gas from Kavarna is planned next July and Kaliakra in October 2010, with an initial combined field flow rate estimated at 45 MMcf/d.

Melrose expects its expenditure in 2009 to be around USD 165 M, slightly lower than market estimates, and forecasts preliminary capital expenditure of USD 195 M for 2010.

Melrose posted a pretax profit of USD 19.8 M for the first half, compared with USD 134 M a year ago. Revenue fell 58% to USD 97.5 M.

 

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