Successful tender for geothermal exploration, production & prospection in Hungary

As reported today by the Ministry for Innovation & Technology, the 2019 concession bid-round – based on their tender documentations has concluded for four contracts.

Of the four areas tendered, one was for geothermal energy.  The winner of the Gádoros area tender for geothermal energy exploration, production and prospection is Aspect-TDE Geotherm Kft. Since 2013, the seven successful concession rounds resulted in HUF 38 billion government revenues while more than HUF 110 billion investments could be realised.

The mining concessions were awarded by the Minister for Innovation and Technology in accordance with the relevant provisions and based on the evaluations and recommendations of the Evaluation Committees. The winners may conclude their concession contracts within 90 days following the announcement of the result. This time limit may be extended by the Minister only once by a maximum of 60 days.

Seven bids were submitted for the tenders of 2019 June and all of them met the formal requirements. The exploration, appraisal and production tenders were unsuccessful due to lack of bidders in the following areas: for hydrocarbon in Csongrád, Csorna, Érd and Zala-Kelet and for lignite in Sajókápolna.

The granted concessions are valid for 20 years in case of hydrocarbons and for 35 years and the original duration may be extended once without a further call for tenders for a maximum of half of its original duration.

The previous six successful bidding rounds resulted in 31 hydrocarbon and 3 geothermal concession contracts. The government realized HUF 14.7 billion concession fees and HUF 21.5 billion mining royalties. The winners undertook HUF 67 billion of obligatory and HUF 39.8 billion of optional investments in their exploration working programmes.

In the first three quarters of 2019, 35 percent of crude oil production and 10 percent of gas production came from the newly acquired concession areas. In the recent 7th bid round, the conclusion of all the awarded contracts will result in HUF 2.41 billion of concession fees and the total investments undertook in the exploration working programmes of more than HUF 5 billion.

The cost effective and environmentally conscious exploitation of domestic energy resources decreases the energy import-dependence of Hungary and enhances the security of supply. For the promotion of investments in domestic exploration and production, the Ministry for Innovation and Technology is currently planning to launch further concession bid-rounds.

Source: (ITM Kommunikáció), Hungarian Ministry for Innovation & Technology