FBiH Government Preparing Platform for Negotiations with "Shell"!

The Government of the Federation of BiH is preparing a negotiation platform for talks with the American oil corporation “Shell“ regarding the exploitation of oil deposits in BiH, confirmed for the Bosnian news agency Patria (NAP) Erdal Trhulj, the Minister of Energy, Mining and Industry of FBiH.

According to him, the preparation of a tender for the selection of consultants in the negotiations is underway, given that these are negotiations for a historic concession agreement for the exploration and exploitation of oil in BiH!

The oil company “Shell“ expressed its interest in obtaining a concession from the FBiH Government back in September 2011, and a memorandum of cooperation was signed.

The Government of the Federation of Bosnia and Herzegovina adopted a decision declaring the Concession Agreement for the exploration of oil and gas in the Dinarides as a strategic interest. Trhulj told NAP that at the last Government session, ministries were tasked with preparing several regulations and organizing this sector, as this activity did not exist in the Federation until now.

- The Government has given its consent to announce a tender for a negotiation consultant, and as far as I know, the tender is being translated and the Prime Minister of the Government is authorized to sign all acts. Whoever negotiates must have a legal framework for negotiations. The Ministry of Environment is tasked with adopting regulations on environmental protection fees for this activity, as we did not have them before - Trhulj said.

Trhulj: Legally Regulate the Sector and Increase Profit Tax on Oil

Furthermore, Minister Trhulj explains that before signing the agreement with Shell, BiH must adopt a series of regulations and organize this sector.

- The Ministry of Finance must, within 40 days, establish a fiscal policy for this sector, as earnings come not only from concessions but also from profit tax. Ours is 10 percent, but we have not had oil exploitation, while in countries that engage in oil production and exploitation, the profit tax is around 50 percent, which is why the Ministry of Finance is tasked with preparing this - Trhulj added.

The Ministry of Energy, Mining and Industry is tasked with adopting a decree prescribed by law that will establish the legal framework for concluding concession agreements.

- The Ministry of Labour and Social Protection is also tasked with adopting a regulation on occupational safety for this sector, as it is specific and has not existed in the Federation until now. This would create all the prerequisites, and the negotiations themselves are within the competence of the Commission that needs to announce the tender to select consultants and start negotiations - Trhulj added.