From notes@igc.apc.org Mon Aug 28 17:00:21 1995
Received: from cdp.igc.apc.org (192.82.108.1) by MediaFilter.org
 with SMTP (MailShare 1.0b10); Mon, 28 Aug 1995 17:00:22 -0500
Received: (from notes) by cdp.igc.apc.org (8.6.12/Revision: 1.204 ) id MAA00726 for "conf-zamir.chat"; Mon, 28 Aug 1995 12:46:37 -0700
Date: 28 Aug 1995 12:15:24
Reply-To: Conference "zamir.chat" 
From: doctorc@ix.netcom.com
Subject: Croat-Bosnian Border is Oil Rich
To: Recipients of zamir-chat-l 
Message-ID: <199508281913.MAA00756@ix6.ix.netcom.com>
X-Gateway: conf2mail@igc.apc.org
Errors-To: owner-zamir-chat-l@igc.apc.org
Precedence: bulk
Lines: 114

From: doctorc@ix.netcom.com (. )

Monday, August 28, 1995 
Tuzla, Bosnia                           
     Besieged by rebel Serbs and cut off from normal oil
shipments by  an international embargo, Bosnia has been running
its army and its  economy on a near-empty fuel tank for three
years.     
     Yet officials here are convinced that their country sits on 
its own untapped oil fields -- which were surveyed by
multinational  firms before the civil war began, with results
that have since  vanished from the Ministry of Energy in
Sarajevo.  
     ``We have reason to believe that the documents 
summarizing these operations are now in the hands of Croatia and
the  (Bosnian) Serbs,'' said Selim Beslagic, mayor of
government-held  Tuzla.   
     Although it is by no means certain that Bosnia has
commercially  viable petroleum reserves, a Chronicle
investigation has confirmed  that major oil firms conducted field
studies in the former Yugoslav  republic before 1992 under the
auspices of the World Bank.     
     In addition to the area around Tuzla, the studies
concentrated on  the eastern slope of the ``Dinarides Thrust,'' a
300-mile arc from  Bihac to the Neretva River along the Dinara
Mountains. 
     Sources in Europe and the United States confirm that
deposits  of both coal and oil were identified in the Dinara
region. Recent  military action has underscored the area's high
importance to all  sides in the Bosnian civil war.      
     The Dinarides Thrust was the primary battlefront of this 
summer's massive Croatian Army offensives against rebel Serbs in 
Bosnia and Croatia's Krajina region.     
     {However a map and article from the same paper, Aug 11
'Bosnia Disappearing Into Jaws of Its Neighbors' identifies this
area as part of Bosnia-Herzegovina completely under Croat 
control for several years. (1)--ed.]
     The region, along with other parts of Bosnia, began 
attracting the serious interest of petroleum experts a decade
ago. In the mid-1980s, a World Bank executive said, the  
Washington, D.C.-based institution extended seed loans ``for 
oil-related operations'' to Energo Invest, the state oil monopoly
of  what was then the Yugoslav republic of Bosnia.      
     ``The money was for geophysical and geological data 
acquisition and interpretation and for exploration promotion,''
said  bank official Richard Hamilton.    
     Hamilton, who heads a special task force on ex-Yugoslavia in 
the bank's energy division, said he was not at liberty to provide 
details on the loan or its results.      
     But a World Bank source said the promotion financing implied
``an  expectation of viable potential for oil recovery.''     

AMOCO'S INVOLVEMENT  
     According to Bosnian officials, Chicago-based Amoco was
among several foreign firms that subsequently initiated
exploratory surveys  in Bosnia.     
     Although Amoco also declined to reveal its findings, the 
company established a Bosnian subsidiary, the Amoco Dinarides 
Petroleum Co., in July 1989.   
     International oil experts say that Amoco and other foreign 
companies found evidence of oil in the Dinarides Thrust and in
the  nearby Adriatic Sea.      
     The Italian state-owned oil firm, AGIP, is already drilling
at  offshore sites in the Croatian Adriatic about 60 miles west
of the Dinarides Thrust.  

PROSPECTS FOR TUZLA  
     The situation in northern Bosnia, where Tuzla lies, is more
speculative.    
     ``What we know is that there are substantial petroleum
fields in the Serb-held part of Croatia, just across the Sava
River from the  Tuzla region,'' said Menad Peleksic, chief
consultant to Inter-Energo, the Bosnian state firm that succeeded
Energo Invest when the republic declared its full independence in
1992.         
     ``Geologically, the two areas are quite similar, which means 
it is possible that Tuzla also has reserves,'' he said.           
     The World Bank -- and the multinationals that conducted 
operations -- are reluctant to divulge their latest exploration 
reports to the combatant governments while the war continues.        
     ``Territorial disputes would have to be settled before any 
Western oil company would want to become involved,'' said one
U.S.  expert.   
     Peleksic worked for a subsidiary of Energo Invest until its 
dissolution in 1992, and he paints a picture of organizational
chaos and sabotage at the war's onset that could explain how the 
preliminary exploration documents vanished.   
     ``When things started to fall apart, thousands of (Energo 
employees) took advantage of whatever information they had under 
their control and used it to serve their own interests,''
Peleksic added, obliquely referring to ethnic Serbs and Croats
who left Bosnia  after 1992.   

`EMBRYONIC STAGE'    
     `The oil exploration was still at the embryonic stage
then,''  he emphasized. ``Whether or not Bosnian oil actually
holds commercial  promise remains to be seen.''    
     But even at relatively long odds that oil could be
profitably  extracted, the region is of crucial interest to
war-devastated Bosnia  and Croatia.      
     ``We were 10 percent behind Europe (economically) when this 
terrible conflict began. Now we are 90 percent behind,'' said
Mevlida  Vlajic, Tuzla's director of economic development.
``There is no  potential source of recovery that we can afford to
ignore.''   



The San Francisco Chronicle   http://sfgate.com
Monday, August 28, 1995 · Page A1
Frank Viviano reported this story from Bosnia and Kenneth Howe
from San Francisco.  

(1) SF Chronicle, Aug 11 95 p12