SARAJEVO, Dec 17 (Reuters) - Australia's Key Petroleum Ltd has expressed interest in oil and gas exploration inBosnia after Shell Exploration Co, part of Royal Dutch Shell,pulled out, the Bosnian region's energy minister said onThursday.
The minister, Nermin Dzindic, said a Key Petroleumdelegation would visit Bosnia in January for talks on gettingconcessions for exploration and exploitation of oil and gas inthe Bosniak-Croat Federation, one of Bosnia's two autonomousregions.
"After the meeting we will decide which direction we willtake," Dzindic told Reuters.
Shell Exploration notified the government in September thatit was pulling out of talks on a potential $700 millionexploration deal in Bosnia, which began in 2011, due to achanged energy environment and following an internal globalportfolio review.
The government has amended a law on oil and gas explorationand exploitation and decided to set up an expert panel to helpit draft future contracts after a series of tenders seekingconsultants to help it with the process of awarding a licensefailed to attract a favourable bid.
Experts say that deposits in Bosnia's southern oilfields,located at a depth of 4,000 to 8,000 metres, could contain up to500 million tonnes of oil reserves, while deposits in itsnorthern oilfields are estimated at 70 million tonnes.
Shell was the first oil producer to move towards explorationin the Bosniak-Croat region.
Before the 1992-95 Bosnian war, U.S. and British researchersidentified several potential oilfields in the Balkan country.
In 2011, Bosnia's other autonomous region, the SerbRepublic, awarded a concession for exploring potential oilfieldsto Jadran Naftagas, a joint venture between Russia'sNeftegazinkor, a unit of state-owned Zarubezhneft, and Serbianoil firm NIS, majority-owned by Russia's Gazprom Neft. (Reporting by Maja Zuvela; Editing by Daria Sito-Sucic andSusan Fenton)