Risk Governance Recommendations for Unconventional Gas Development Regulatory Framework in Croatia

       The 6th Asia-Pacific Power and Energy Engineering Conference (APPEEC 2014)——Due to maturity of domestic oil and gas fields, Croatia is facing a problem of increasing demand that present production cannot meet. In order to solve this problem, it is necessary to intensify the activities related to exploration and production of oil and gas in Croatia. INA Plc conducted exploration activities in the north of Croatia, and discovered deposits of natural gas in reservoirs which are characterized as unconventional. Due to contemporary technology and gas prices, gas production from these reser-voirs is much more complex comparing to gas production from conventional reservoirs. It also requires more invest-ments, because both horizontal drilling and hydraulic fracturing, which must be performed in order to produce gas from unconventional reservoirs, are relatively expensive. Strict regulation and legislation on environmental protection in Eu-rope also makes these reservoirs difficult to develop. Although potential reserves of natural gas in tight gas sands and shale of Mura and Drava Basins are vast, further investments are required in order to produce economically acceptable quantities of natural gas. According to European energy policy and energy guidelines risk governance recommendations for making regulatory framework for unconventional gas development have been proposed in this paper.