* Up to $47 million investment for first exploration phase
* Another $315 mln in investment could follow
(Reuters) – A joint venture of Russia’s Neftegazinkor, a unit of state-owned Zarubezhneft, and Serbian oil firm NIS have won a concession to start exploring potential oilfields in Bosnia’s Serb Republic, NIS said on Thursday.
NIS, majority owned by Russian group Gazprom Neft , which holds a 66 percent stake in the joint venture called Jadran Naftagas, said the government of the Serb Republic had awarded it the concession in late June.
“This decision means that oil and gas exploration can start and we hope that it would result in a discovery of commercial deposits in the region,” it said in a statement.
The company had earlier said it would invest, together with its partner, between $13 million and $47 million in the first exploration phase after preliminary estimates indicated there could be around 12 million tonnes of geological reserves of oil.
If the initial exploration in northern Bosnia proves promising an investment of up to $315 million may follow. The project would start in the Serb Republic but might expand to Bosnia’s other autonomous region, the Muslim-Croat federation, the company said.
NIS said that potential reserves could initially produce 100,000 tonnes of crude oil annually starting in 2014 before growing to up to 780,000 tonnes of annual output by 2020.
Neftegazinkor in 2007 acquired Bosnia’s sole oil refinery, Brod.
Research conducted by U.S. and British consultants before the break-up of Yugoslavia in the 1990s showed oil in the north and south of Bosnia but the 1992-95 war stopped the project.
Bosnian geologists say reserves are uncertain. Some see oil deposits in the north from 20 million tonnes in the federation to 50 million tonnes in the Serb Republic, but many deposits are spread between the two regions.
More oil, possibly 500 million tonnes, is believed to exist in the southern deposits at a difficult-to-assess depth of 5,000-6,000 metres.
The Muslim-Croat federation has authorised the engineering group Energoinvest to lead exploration in the region with strategic partners but the process has stalled due to an unfavourable concession law.