Lukoil Reapplies for Exploration License for Russia's Baltic Nadezhda Block

en.Wedoany.com Reported - Lukoil's subsidiary Lukoil-Kaliningradmorneft has resubmitted an application to the Russian Ministry of Natural Resources (Minprirody) for a geological exploration license for the Nadezhda block in the Baltic Sea. The application will be reviewed at both federal and regional levels within one month; if the response is positive, the relevant materials will be submitted to the Cabinet for a final decision, TASS reports.

The Nadezhda block is located in the offshore waters of the Kaliningrad region, within 12 nautical miles of the shore. This oil-prospective area is not legally part of the continental shelf, which has been closed to private companies since 2008, making Lukoil, as a private enterprise, eligible to apply. In May of this year, the block was added to the list of federal subsoil areas available for provision without an auction.

Lukoil has been seeking access to the block since 2016. Initially, the company proposed organizing an auction with special conditions, requiring applicants to be registered in the Kaliningrad region and to have experience in hydrocarbon extraction in the area. The Federal Antimonopoly Service (FAS) determined that only Lukoil met these conditions, and the auction was not held. In 2023, the company resubmitted its application but it was returned, requiring additional materials confirming the ecological safety of the geological exploration work.

The current application process differs from previous attempts. Since the block is on the no-auction list, the application is reviewed under a declarative principle. If the Ministry of Natural Resources and other relevant authorities find no grounds for refusal, the decision will be submitted to the Cabinet level; if the ruling is positive, Lukoil-Kaliningradmorneft will be granted the right to conduct geological studies of the Nadezhda block.

According to information previously obtained by TASS from the Russian Ministry of Natural Resources, if Lukoil is the sole applicant during the "summer window" (June 1 to July 31), the license will be granted to the company without an auction. If two or more applicants emerge, the block's fate will be decided through an auction.