Yesterday, the Honourable Ed Fast, Minister of International Trade, announced that Canada and Albania have finalized negotiations on a foreign investment promotion and protection agreement (FIPA). Minister Fast made the announcement at Albania’s Independence Day reception in Ottawa. A FIPA is a treaty designed to promote and protect Canadian investment abroad through legally binding provisions and to promote foreign investment in Canada. Once in force, the agreement with Albania will facilitate investment flows between the two countries.
“I am pleased to announce today that Canada has concluded a key investment treaty with Albania that will help ensure the business environment is more secure for Canadian companies looking for opportunities in Albania,” said Minister Fast. “It is also further proof that the most ambitious trade expansion plan in our nation’s history continues to produce results for workers, investors, businesses and exporters.”
According to Albanian authorities, Canadian companies are the largest foreign investors in the country, spending over $850 million in investment in 2012. Bankers Petroleum (BNK:TSX) is the largest foreign direct investor in Albania with some 226 million barrels of oil in 2P reserves and over 19,000boe/d average production in Q3/2013.
Petromanas (PMI:TSX) has already spent, with its partner Royal Dutch Shell, many millions of dollars in Albania and with the recent success of the Shpirag-2 well (1,500-2,200boe/d initial flow rates), will certainly become a large scale investor in the country in the near-future. Shpirag-2 saw $75 million directly invested into Albania alone. With the huge potential of their southern Albanian oil field, PMI and Shell have plans to drill more wells into the some 800 meter oil column identified in fractured carbonate reservoirs at the Shpiragu structure.
This oil discovery is a potentially large-scale productive field development which would require many millions of direct investment by Shell and PMI. Therefore, having a solidified foreign investment treaty signed between Canada and Albania is a crucial part of economically financing its development.
“Conclusion of this investment treaty will help strengthen the bonds between our governments and should support improved opportunities for Canadian companies,
like Petromanas, with operations in Albania,” said Glenn McNamara, CEO of Petromanas.
Disclaimer: Exploration stocks such as Petromanas Energy (PMI) are extremely risky. This is not advice or a recommendation to buy shares in any company. We own a position in PMI and are biased. Always do your own due diligence.