The International Finance Corp. has agreed to financially support further privatization of Albania's Patos Marinza oil field with a $50 million loan to Bankers Petroleum Ltd. of Calgary, the World Bank Group member said on May 11.
The Canadian oil and gas producer operates and has full rights to develop the Patos Marinza and Kucova heavy oil fields under a 25-year license agreement with the Albanian National Agency for Natural Resources, and a petroleum agreement with Albania's national oil company, Albpetrol ShA, according to information posted on Bankers Petroleum's website.
Patos Marinza is the largest onshore oil field in continental Europe, with about 2 billion bbl of oil in place, it added. IFC, which also approved a $5 million environmental term loan to Bankers Petroleum, said that it also may make an equity investment of up to $9.5 million.
Its announcement came hours after the European Bank for Reconstruction and Development in London said that it plans to make a similar $64.5 million financial commitment.
IFC said that Bankers Petroleum's Albanian subsidiary has been operating a small portion of the Patos Marinza field since 2004. The expansion of its activity will modernize the field's operation by transferring specialized technical knowledge to a largely local workforce, it said.
This will contribute revenue to Albania's government and help promote foreign investment in the country's petroleum industry, IFC added.
The loans also will support significant environmental improvement in one of Europe's most badly polluted oil fields following decades of mismanagement, both multi-government financing institutions said. They said that Bankers Petroleum will clean up existing wells it takes over and help reduce pollution and oil field contamination as it expands its activities.
IFC said that the United Nations Development Program classified Patos Marinza as one of Albania's pollution hot spots. It said that since the cleanup involves additional stakeholders, IFC and EBRD have established a working group to formulate environmental and social strategies. The agencies already have spoken with Albania's ministries to secure their support, and with the European Union to align ongoing initiatives, it added.
Bankers Petroleum said that it is in the process of creating a development plan for the second field, Kucova, which it expects to use a combination of reactivations, recompletions and secondary recovery techniques such as waterfloods.
Contact Nick Snow at [email protected]
