OIL AND GAS EXPLORATION IN THE MONTENEGRIN UNDERSEA AREA: EMPTY NETS AND DREAMS OF BILLIONS

DESPITE THE CLEAR MESSAGE OF THE EUROPEAN UNION THAT FOSSIL FUELS ARE THE PAST, AND THAT THE FUTURE IS RESERVED FOR ENVIRONMENTAL AND RENEWABLE ENERGY AND DESPITE BAD EXPERIENCES FROM THE REGION MONTENEGRO STARTED DRILLING THE ADRIATIC BOTTOM. ENVIRONMENTAL ACTIVISTS ANNOUNCE THAT THE PROTESTS WILL BE CONTINUED AFTER THE TOURIST SEASON

Branko Vujičić, an experienced fisherman, searches in vain for shrimp and prawns on the bottom of the Adriatic. The fish stock is declining, he says, and he attributes that to drilling the seabed in search of oil.

"They live on the bottom of the seafloor so drilling is probably causing some vibration that affects the fish. There are no shrimp anymore, we cannot catch even two kilos, and we used to catch a hundred. Their price has now dropped to three euros. This is not the case only in Ulcinj and Bar, but also in other cities – I have been fishing for them all along the coast, but it seems that shrimp are gone. Shrimp and sardines are food for all other fish ", Vujičić says in an interview for the Center for Investigative Journalism of Montenegro (CIN-CG)/Monitor.

The Topaz Driller giant metal jack-up rig started drilling operations looking for possible oil and gas deposits on March 25 on 20 kilometers from the coast, between Ulcinj and Bar. The investor, the Italian-Russian consortium Eni-Novatek, will search for black gold to a depth of 6,500 meters. Whether there is oil in the Montenegrin submarine will be known, allegedly, at the beginning of September.

The oil and gas exploration continues despite the warnings of environmentalists that this is a risky endeavor and violation of the Paris Agreement and the announcements of the new protests at the end of the tourist season. The fishermen's complaints regarding the decline in fish stock due to the drilling are also in vain. However, the drilling continues with the blessing of the current Government, which in this case continued the work of the previous Government.

Not even enough fish to cover the cost of fuel

In a statement for CIN-CG/Monitor, the Ministry of Capital Investments says that according to the information they have, "ongoing oil and gas research has not in any way affected maritime traffic and the work of the Port Authority. The traffic flow is normal and everything is in the right order."

"They forbid us to approach that platform within a few kilometers. And our sea is small, if I take a boat ride from Ulcinj in the morning, here I am in Croatia in the afternoon ", Vujičić, who is also the president of the Association of Professional Fishermen of Budva St. Nikola, says.

Dragoljub Bajković, president of the Association of Professional Fishermen of Bar, believes that fish from the seabed, including shrimp, began to disappear with the first seismic surveys that preceded the current drilling.

"A couple of years ago, seismic surveys were done, during which the pressure at the bottom was 3,000 bar. Then the fish from the bottom were killed, or migrated to the other side where there were no such surveys - towards Albania and Boka," he says.

Bajković is convinced that the current drilling will seriously affect fishermen.

"It affects the fishermen of Ulcinj, Bar, all the way to Čanj. They go fishing from morning to evening, 10 -12 hours, and bring a minimum of fish, enough only to cover the expenses of fuel. I catch bluefish and I went fishing 29 times from December to July - 10 times I threw nets, and 19 times I came back, because the fish wouldn’t bite. There are some underwater vibrations from drilling. The fish is running away like wild. Something is completely disturbed. And a lot of us make a living from fishing.”

Before the start of drilling, a meeting was organized with the representatives of the fishermen's association at the Ministry of Capital Investments.

"Fishermen told them that they were not looking forward to that research, but if the state decided to carry out these explorations, we must accept it," Milun Anđić, president of the Association of Vessels of Montenegro, says.

At the request of fishermen to form an equalization fund that will help the development of fisheries, the Ministry answered that it will be formed as soon as oil exploration begins.

Government: Everything is fine

"We emphasized the importance of environmental protection and received assurances that they have quadruple systems. They explained to us that the depth at which oil is extracted is 110 meters and that it is accessible to divers, devices, valves so that in case of a leak everything can be closed immediately. They gave guarantees that the ships specialized for oil leaks are ready in Italian ports and that they could be there in 10-15 hours to suck up the oil ", Anđić says.

He assesses that the fishermen had no choice and that they gave tacit consent to the assurances that the fishing industry and the oil industry could work together.

According to Anđić, previous research on fish stock was done arbitrarily and not properly. That is why the fishermen complained to the institutions: "That research was carried out by ships that aren’t specialized. No fishing boats were taken. It was all financed by investors. "

Bajković also says that the investor and the Institute of Marine Biology should have determined the initial state of the fish stock during this year, which, as he says, does not exist.

"The Institute of Marine Biology did not conduct a study of the impact on fisheries. It monitored fishing activities before and after seismic, i.e. analysis of the catch structure of small-scale coastal and large-scale commercial fishing. We are not engaged in current activities related to the platform in terms of fisheries monitoring. We may be involved after the completion of activities related to the platform", Dr. Aleksandar Joksimović, director of the Institute of Marine Biology, says for CIN-CG/Monitor.

The beginning of drilling was marked with environmentalists' protests who pointed out the numerous environmental risks of this exploration, while the new Government convinced them that there was no room for anxiety. Prime Minister Zdravko Krivokapić said that the concession agreement, signed in 2016, was rarely a good decision made by the previous Government. He also assessed that the possible impact on the environment is negligible.

Environmental organizations and activists voiced their opposition to the start of drilling, while the ruling Civic Movement United Reform Action (GP URA) called for a referendum. The Prime Minister suppressed the opposing views by claiming that the termination of the deal with Eni-Novatek would cost the state around one hundred million euros and that the referendum would be technically unfeasible in the conditions of the corona crisis, at a cost of around two million euros.

Minister of Capital Investments Mladen Bojanic also claims that this is a good project. He has said many times that potential oil and gas reserves are measured in billions of euros.

Bojanic: It's all at their expense

"The main characteristics of the contract with the Eni-Novatek consortium are that Montenegro has not invested a single penny in the research and that the concessionaires bear all the costs," Drasko Loncar from the Ministry of Capital Investments told Monitor/CIN-CG. He explains that Montenegro has provided guarantees, "on the mandatory work program", and that the concessionaires have unlimited and joint liability to compensate the damage and lost profits to the state and third parties in case of an incident, and most importantly, that the state provided profits between 62 - 68 percent.

Loncar explains that the obligatory work program that the Eni-Novatek concessionaires have committed to includes: 3D seismic research, geological and geophysical studies, and two exploration wells of 6,500 and 1,500 meters.

In case the concessionaire does not fulfill the obligatory work program, according to Loncar's explanation, Montenegro could activate the guarantee of 84 million euros that it has provided and possibly hire another company to continue with exploration.

The Ministry of Capital Investments points out that, if no commercial hydrocarbon reserves are found, the entire cost of exploration will be borne by the concessionaire, without any obligation on the part of the state to participate in it.

"This is a business that is unprofitable, risky, and harmful to the environment and the economy of Montenegro, primarily tourism and fishing," Mustafa Canka, a journalist dealing with this issue for decades, stated.

He points out that the officials are only talking about financial benefits and percentages, without publicly stating that "in the best case, in their most optimistic scenario, we can earn around 60 million euros a year. And only in a few years."

"To find oil, more wells need to be drilled, more analyzes conducted, so in the best case the exploitation would start in three years. Until then, we will question everything, especially tourism from which in the case of a good season, the state earns a little over a billion euros, while at least a third of the income remains in the gray zone ", Canca says for CIN-CG/Monitor.

A romantic turtle saga

He wonders if it is profitable if we compare 1.3 billion with 60 million. He stated that guests from the West are not thrilled to have a view of the oil platforms. He notes that the damage done to the flora and fauna in the sea will never be calculated, as will the damage suffered by fishermen.

However, the Ministry of Ecology, Spatial Planning and Urbanism is not worried about this project and its impact on the environment. In addition to the obligation to respect domestic regulations that regulate the field of environmental protection, this Ministry also states that the contract envisages two special mechanisms for compensation of possible damage. The first is the Parent Company Guarantee of the concessionaire which covers payments of all obligations under the contract in case of non-performance, as well as all non-contractual obligations to third parties in case of direct damage or losses incurred in connection with these activities (including pollution or incidents). This guarantee, as they explain in the Ministry, means that the concessionaires guarantee the value of the parent company and not the one registered in Montenegro, which is incomparably smaller.

The second mechanism is the Mandatory Comprehensive Insurance Policy for the Oil and Gas Industry, which covers the complete operations performed by the Eni operator, including all their subcontractors.

"Montenegro has ensured that in case of any damage to the environment, it has the possibility of reimbursement of costs, including damage to third parties. In this particular case, that means, for example, that the compensation for possible damage would be paid to the fishermen as well ", they say from the department that also deals with ecology.

The Ministry of Capital Investments also claims that "a large number of ecologists" have a positive opinion on the project, as well as on all the studies done on the protection and preservation of the environment.

"The commitment of the concessionaire towards the environment should be emphasized. For example, during the seismic research, a turtle appeared in front of the ship and the operations were suspended until it moved away to a safe distance. The cost of waiting or stand by installment was about $ 150,000. Therefore, we emphasize that the concessionaires have high standards when it comes to environmental protection ", they say from this Ministry.

The oil spill response exercise

Zenepa Lika, an environmental activist from Ulcinj, is not convinced of these standards, claiming for Monitor/CIN-CG that this venture is risky. She explains that it relies on an environmental impact assessment study conducted by the investor.

"The Environmental Protection Agency (EPA) returned the document for revision several times, which means that Eni did not respect Montenegrin legislation. As far as I know, there is no contingency plan in case of oil spills, techniques and projections for recovery ", Lika claims.

The Environmental Protection Agency confirmed that the Environmental Impact Assessment Study, carried out by Eni Montenegro, and prepared by Italian experts, was not done following the rules. In October 2019, the Agency requested certain amendments from the project holder. The revised Study received the consent of the Agency in December of that year.

The Ministry of Capital Investments claims that in case of emergency, there are plans: "There is a reaction plan of the concessionaire, a reaction plan of Montenegrin institutions responsible for this project, as well as a reaction plan in cooperation with the concessionaire." Also, in June, the oil spill response exercise PLATFORM 21 was held, in which the Administration for Maritime Safety, the police, the army, the Port Authorities, and the Hydrocarbons Administration participated. Of course, in addition to these plans, there are other plans for reaction to all foreseen incidents. "

They also claim that the inspection supervision is constant and that it will remain the same during the entire project.

"The Inspector for Hydrocarbons as well as the Environmental Protection Agency, based on the results of  Center for Ecotoxicological Research (CETI) analyzes, are closely monitoring and controlling this project, both at the plant and in the logistics base. For now, the process is completely safe and secure for the environment and staff, as well as for the approved project itself, " the Ministry stated.

In early April, Ulcinj's parliament unanimously adopted conclusions expressing great skepticism about seabed drilling.

"The Municipality calls on the Government to participate transparently and cooperatively in the reviewing of decisions related to offshore oil exploration, taking into account the views of the citizens of coastal municipalities, environmental and economic aspects of demographic data," it was written in the adopted conclusions.

Lika says that from the very beginning of this non-transparent and undesirable project, the former, and unfortunately the current Government, violated the constitutional right of the citizens of coastal and other cities because they were not timely and adequately informed.

"I note that, for example, the citizens of Ulcinj were surprised when they found out that oil would be explored in our sea 'again'. They were also denied participation in a public hearing organized in Bar. On the same day, a public debate was held in Ulcinj on a special purpose plan for the coastal area. So, the first part of research is planned on the coast of Ulcinj, and citizens were prevented from giving their opinion ", Lika says.

The Ministry of Ecology points out that the oil and gas industry is not unknown in the countries with which Montenegro shares the sea borders: "So far, about 1,500 wells have been drilled in the Adriatic for the needs of both exploration and oil and gas production."

Albania's bitter experience

Eni's Environmental Impact Study specifies that there are 1,440 wells in the Adriatic Sea (for exploration, production, and other purposes), of which 1,350 were drilled by Eni S.p.A, and that no eruption was recorded in any of them.

"Neighboring Croatia has declared a moratorium on all new oil and gas exploration, even the 'oilmen' from Croatia themselves oppose drilling in the Adriatic Sea. They think that oil and clean sea simply do not work together,” Lika says.

She points out that Albania does not have a platform at sea, but exploitation is done on land. She warns of pictures and footages from 2015 when a big accident happened in the village of Marinza in the south of Albania when the entire settlement was flooded with oil so the citizens were forced to evacuate, while a strategic investor from Canada, Bankers Petroleum, simply pleaded not guilty to the incident.

Referring to the Albanian experience of oil exploration, Canka also says that "it indicates that Montenegro should not enter this dangerous deal".

"Since 1990, research has been conducted on large global companies in the Albanian part of the Adriatic, and there are no concrete results. "Only in a few cases oil was discovered, but it turned out to be an unprofitable exploitation," Canka points out, noting that sweet dreams of "Albania floating on oil" were also dreamed in that country during the 1990s.

"After three decades, the illusions dissipated in the Adriatic and, unfortunately for us, reached the official Podgorica," Canka says.

Montenegro has started drilling the Adriatic, despite the European Union's clear message that fossil fuels are the past and that the future is reserved for environmental and renewable energy.

In November 2019, the finance ministers of the countries of the European Union agreed that the financing of projects that include oil, gas, and coal should be stopped. On that occasion, they called on the European Investment Bank, the World Bank, and other financial institutions to stop giving loans for those purposes. It was the first time that senior European government officials sought to end funding for all fossil fuels, taking into account sustainable development and energy needs, and the energy security of partner countries.

Environmentalists remind that Montenegro is a signatory to the Paris Agreement, by which 200 countries committed themselves to gradually abandon the use of fossil resources.

"With this project, we are violating the agreement and forcing the exploitation of fossil fuels, even though we know that this type of exploitation affects climate change and certainly the quality of our sea, regardless of the opposite claims," Lika concludes.

Under the Green Agenda for the Western Balkans, the EU has mobilized up to nine billion euros for innovative and green ideas and projects. Environmentalists believe that it would be better to use this opportunity for long-term environmental and financial benefits than to drill the seabed.

The actions of environmentalists against underwater drilling, as announced by the interlocutor of CIN-CG/Monitor, will continue.

The actions of environmentalists against undersea drilling, as Lika announces, will continue.

"We have not given up on our demands and we are asking for the suspension of oil and gas exploration and exploitation. We have stopped the protests during the tourist season because we sympathize with the citizens and we do not want to spread an even more negative image of our country ", Zenepa Lika says.

A small amount of oil sufficient for great damage

Only eight grams of oil is enough to pollute a cubic meter of seawater. One cubic meter of spilled oil depletes oxygen from 400,000 cubic meters of the sea, the report of the State Audit Institution (SAI) states, which published an Audit of the Efficiency of Intervention Management System in Case of Sudden Pollution in the Adriatic Sea in April.

The audit found poor cooperation between national institutions, non-compliance with outdated strategies, and that no coastal municipality has a plan and risk assessment in case of sudden sea pollution, as well as lack of adequate equipment to respond to large-scale pollution…

The SAI's document also states the Hydrocarbons Administration's response regarding the current exploration works: "Measurements of the fish catch in the zone of the proposed activities were performed both before and after the geophysical research by the concessionaire, to compare data on the fish catch before and after the activities. Also, since the fishing activities during the geophysical research were difficult, the concessionaires compensated the fishing associations for the time during which the geophysical research activities took place, following the measures from the study on environmental impact assessment."

Predrag NIKOLIĆ