Valiexchimp to explore oil, gas fields in southern Moldova

Moldovan oil company Valiexchimp Ltd took over part of the rights to explore oil and gas fields on Moldovan soil from the American company Redeco Ltd, which reached a concession agreement with the Government back in 1995. The decision was backed by the Government at its sitting on Wednesday, September 19. The draft decision stipulates that Valiexchimp has become successor of Redeco Ltd, following merger through absorption of the latter by the Moldovan oil company. Although Redeco’s oil and gas concessions covered the entire territory of the country, Valiexchimp inherited just the fields in the vicinity of the villages Valeni and Victorovca, in southern Moldova. That is because, according to the agreement with Redeco, the exclusive right for 10 years of exploration expired in 2005, leaving just these two fields available for exploration. More than a year ago, the Government decided to annul the agreement with Redeco, because since the signing of it in 1995, the company has failed to honour its contractual obligations. In July 2006, the authorities decided to announce a new bid for oil and gas exploration concession that will cover a territory of 6,300 km2 in the south of the country. So far, the contest hasn’t been announced. Currently, Valiexchimp owns 32 filling stations across Moldova and is said to rank fourth in terms of sales. The agreement with Redeco Ltd was signed for a period of 20 years. Under the concession contract, the company was supposed to extract roughly a thousand tonnes of crude and 400,000 m3 of gas, and also produce 4 million kWh. In 1995-1999 Redeco had invested more than $11 million in Moldova and had completed preliminary shallow exploration studies. However, exploration has not led to any major findings. Theoretically, Moldova’s oil reserves are estimated at 2-3 million tonnes. Until present, as little as 500 tonnes have been extracted. The Academy of Sciences has stated earlier that space photo evidence confirmed the existence of oil reserves in southern Moldova, but their exploration requires drilling to depths of up to 3 km.