British oil and gas explorer Melrose Resources is starting work at its Bulgarian deposits Kaliakra and Kavarna on Thursday, the Bulgarian Economy Ministry has announced.

In the summer, the Bulgarian government granted two weeks ago a ten-year concession for the extraction of natural gas to the UK company.

The stock of both deposits amounts to 2,5 billion cubic meters and is expected to provide at least 255 million cubic meters of natural gas per year by 2015.

The company foresees a production of 500 million cubic meters.

Data from the Economy Ministry shows that the expected revenues for the duration of the concession are over 73 million dollars. However, there is no information from Melrose Resources about the price of the natural gas extracted in Bulgaria and to whom it would be sold.

Until now, the company was exploiting the Galata deposit, which is already depleted.

The Kavarna deposit is located in the Black Sea shelf near the town of Kavarna, and has an area of 4.36 square km. It is estimated to have about 773 million cubic meters of gas, and its extraction can start in 3-4 months.

The new deposit is located close to the Galata platform and the adjacent gas processing facilities in the region of Varna built by Melrose Resources.

The Kavarna deposit itself is not big but together with two other deposits nearby – Kaliakra and Kavarna East – it has a total of 3 billion cubic meters of natural gas.