There be oil in them there Albanian hills?

Well there is according to Bankers Petroleum Ltd, a Canadian oil company who recently announced they had acquired the exclusive right to evaluate and redevelop the Kuçova heavy oil field in Albania.

Bankers Petroleum Ltd is pleased to announce that it has elected to exercise its option to acquire the remaining 50% interest in the Kuçova oil field, through the acquisition of the remaining issued and outstanding securities of Sherwood International Petroleum Ltd. The final closing was completed for a payment of $1.5 million.

Kuçova reserve mostly untapped to date

Bankers estimates that there is some 490 million barrels of oil that could be extracted from the Kuçova oil field and which to date has only produced some 5% of its total capacity:

Bankers is in the process of completing a work program and budget to further develop the Kuçova field, which has in excess of 490 million barrels of original-oil-in-place and has only produced 5% or 25 million barrels of the oil-in-place.

Bankers’ management believes that the use of modern technologies and maintenance practices will make this field an attractive candidate for further development given the low recovery of oil to date. A revitalization program planned for this opportunity would involve updating surface and downhole equipment, wellbore stimulations, recompletions and the incorporation of secondary recovery techniques, such as waterflood recovery.

Largest European inland oilfield

If Bankers estimate of the volume of extractable oil is correct then this would make the Kuçova oil field the largest inland oilfield in the whole of Europe (though it should be noted that Bankers put a pretty big disclaimer at the end of its press release to say it could be wrong in those estimates).

This is very encouraging news for the Albanian government as not that many countries have access to domestic supplies of oil and especially with the relative ease of extraction from a land site compared to the sea bed. The revenue stream would certainly help to swell the government coffers as it issues the licences to extract oil within the country and generates an income from it.

Putting things into perspective

Despite being the largest inland oilfield in Europe the estimated reserves do not look quite as impressive when you consider the following:

• North Sea Oil - In 1999 at the height of production the UK was extracting 2.7 million barrels of oil per day. Combined with that extracted by Norway, Denmark, Germany and the Netherlands this was raised to 6 million barrels per day. So just less than three months worth then.
• 490 million barrels is less than the amount of oil consumed globally each week.

Still 490 million barrels is 490 million barrels and is not to be sniffed at. At a current world market price of around $130 per barrel this is a total future potential revenue stream for someone of 63.7 billion dollars. Even if the Albanian government were to get say 10% of the total just think how many potholes in the roads they could afford to fill with that?