Oil Regulation (Part 1)


The petroleum market in Greece is facing significant issues, mostly due to the distortion of competition, smuggling and lack of substantial development in recent years. However, the market offers challenging opportunities to investors provided that much awaited changes – at both a regulatory as well as a business practice level – are followed through. The below report aims to present a brief, yet concise overview of the various aspects (sectors, risks, challenges, opportunities) of the Greek petroleum market.


The upstream sector, the searching for potential underground or underwater oil and gas fields, drilling of exploratory wells, and subsequently operating the wells that recover and bring the crude oil and/or raw natural gas to the surface is not developed and opportunities are now rising.

What is the legal framework governing the search and exploitation of hydrocarbons?

Law 2289/1995 as amended by new Law 4001/2011 constitutes the applicable legal status regarding the research and exploitation of hydrocarbons.

The right for search, research and exploitation of hydrocarbons existing in land, below lakes and underwater on which the Hellenic Republic correspondingly exercises its dominance or dominant rights according to the provisions of the United Nations Convention on Law of the Seas, as such was ratified by virtue of Law 2321/1995 exclusively belongs to the State and its exercise always regards the public interest. The management of the said rights on behalf of the State is exercised through the Hellenic Hydrocarbon Resources Management (HHRM) established by virtue of new Law 4001/2011, actually in formation.

Which are the methods of concession of hydrocarbon search, research and exploitation rights?

The search right for hydrocarbon, as well as the license for the execution of seismic or geophysical and geological non-exclusive research methods by specialized companies (Non- exclusive seismic surveys)1, is granted by virtue of a decision by the Hellenic Hydrocarbon Resources management (HHRM), approved by the minister for the Environment, Energy and Climate Change and for a term of up to eighteen months.

The research and exploitation rights are granted under the following procedures:

a) either following a declaration, for areas below lakes and underwater2, approved by the Minister for the Environment, Energy and Climate Change, published in the Government Gazette and also sent for publication to the Official European Union Journal. The deadline for the submission of offers is determined in the declaration and cannot be shorter than ninety (90) days from the last publication.

b) either following the application by an interested party for an area not included in the declaration under a) hereinabove. HHRM, provided the application is accepted, issues a declaration approved by the Minister for the Environment, Energy and Climate Change, published in the Government Gazette and also sent for publication to the Official European Union Journal. The deadline for the submission of offers by any other interested parties is at least ninety (90) days from the last publication

c) either through an open invitation (open door) for the submission of interest in case that the area under discussion is available on a permanent basis or has been the object of a previous procedure which did not conclude with the execution of a lease or production distribution agreement or has been abandoned by the contractor, in case the latter has withdrawn from or terminated the agreement. The minister for the Environment, energy and Climate Change by virtue of an announcement published in the Government Gazette and sent for publication to the Official European Union Journal, communicates the said areas along with the minimum basic conditions of the concession, as well as any specific information related thereto. The interested parties may submit an offer for concession for more than one area. The offers are submitted until the last workday of the first and second semester of each calendar year.

In a time period of thirty (30) days following the end of the semester for the specific area, the Minister for the Environment, Energy and Climate Change announces that the specific area is exempt from the areas available as above, since it is under the concession process. The offers are evaluated and the one most profitable to the State is selected, following negotiations with the interested parties and based on the invitation criteria.3


The new law introduced for the first time in Greece, two widely used international practices a. The Non-exclusive seismic surveys and b. The Open Door, which shall offer attractive areas of our country through transparent procedures in the international oil market, thus sending a powerful message to the international markets by attracting the interest of the oil industry after a long absence from this field, with the simultaneous creation of work places. However, an exhilaration of the general research timetable and consequently of the commencement of hydrocarbon production in case of discovery is required, given that Greece has been out of the oil market in the fields of research and production for the past decade and thus, in order for the effort to succeed, the technical preparation and promotion of the competition must be the best possible, so as to ensure the participation of reliable oil companies and for the success of the realization of business plans.

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