Bukotermal – The Future of Development and Energy Independence for the Bukovec area and Varaždin County

The Largest Project in the History of Varaždin County

The Bukotermal project is one of the largest and most significant initiatives not only in this area but also in Varaždin County, possibly extending its importance beyond. We spoke with Darko Marković, the Mayor of the Municipality of Mali Bukovec and the key figure in this project, about the progress made this year and the current status of the project.

Behind us is a year full of activities as far as the Bukotermal project is concerned?

Bukotermal is a joint project of the County of Varaždin and the Municipality of Mali Bukovec, and what we started with at the beginning of this year was a Conceptual exploitation development project. This document followed the proof of reserves, that is, the confirmation by the Ministry of Economy that we have proven reserves, the approval of the exploitation field, and other necessary documents.

Once the Ministry of Economy authorized us to proceed with an exploitation development plan, we created the Conceptual design, outlining procedures and scenarios for the commercial use of the proven geothermal water reserves. We submitted this design for verification while simultaneously preparing the Environmental impact assessment based on it.

After receiving approval for the Conceptual design, we finalized the Environmental impact assessment in line with suggestions and submitted it to the Ministry of Economy for verification and an approval.

Timeliness is crucial in a project like this. Some decisions take a very long time, but Bukotermal leveraged its advantages?

Approval for such an Environmental impact assessment can take up to a year, especially for complex projects like ours. However, thanks to the commitment of County Prefect Anđelko Stričak and support from then-Minister of Economy Damir Habijan, we received approval in under two months.

Upon obtaining the Approval for the Environmental impact assessment and the Approval for the Conceptual exploitation development project, we proceeded with drafting the Main exploitation development project, the most complex stage. Everything stated in the Environmental impact assessment, the Approval for it, and the conditions outlined in the Approval for the Conceptual design had to be incorporated into the Main project, including four scenarios for the exploitation of geothermal water reserves proven in the Lunjkovec-Kutnjak geothermal field. These scenarios, ranging from simplest to most complex and costly, were approved in late August, alongside a positive Approval on the petroleum development project and the exploitation of Lunjkovec-Kutnjak Geothermal Field.

What followed after the approval of the Main project?

It should be emphasized that the moment we received the Approval for the Main project, we transitioned into the exploitation phase. The preparatory part of this phase is actually the signing of the Exploitation Agreement. To sign the Exploitation Agreement, we still need to obtain several documents related to the exploitation approval, which are currently pending issuance. We anticipate receiving them in the next few weeks. Following that, we have 30 days to finalize the Exploitation Agreement. This agreement is essentially the final document, marking the definitive end of the exploration phase and preparation for the exploitation phase. After that, the design and actual exploitation will commence. In the next year, we will focus on designing the trial exploitation phase, conducting additional capacity testing of the Kutnjak-1 well using the newly installed wellhead, an investment of approximately €170,000. We will need to carry out testing to once again confirm the flow rate, that is, the volume of water that the Kutnjak-1 well can produce.

In addition to the existing ones, is there a need for new wells at the exploitation site?

Simultaneously with the design of the trial exploitation, we will also work on designing a new well. After the trial exploitation is completed and we obtain new data regarding the flow rate, we will most likely need to redefine the reserves, potentially increasing them. Currently, we have reserves defined based on older flow rate data. At that point, we will seek a new solution, and simultaneously, over the next year, we will proceed with designing the first new well and working on the conceptual design or project for a geothermal power plant, depending on the results of the trial exploitation and our plans for the new well.

To conclude...

The year 2025 will be marked by the signing of the Exploitation Agreement, trial exploitation at Kutnjak-1, and the design of the first well in a series of several to follow. These wells will be drilled over the next one to two years to achieve the required number of wells, both production and injection, for the most ambitious and expensive scenario.

You mentioned the four scenarios. Which scenario is preferred by the owners of Bukotermal, Varaždin County and the Municipality of Mali Bukovec?

Varaždin County and the Municipality of Mali Bukovec have opted for the most ambitious scenario, aiming for the largest possible geothermal power plant in terms of capacity, which will require the highest financial investment. There is significant interest from numerous domestic and foreign partners who would like to participate in the project, or even acquire it, or in some way (co-)finance it. However, both the County Prefect, Stričak, and I, as the Mayor, share the same perspective—whatever happens, whether financing, partnership, entry into a joint-stock company, or co-ownership, we want it to remain a domestically owned company, publicly managed, and primarily financed by local capital. These are the steps that must be completed during 2025: the Exploitation Agreement, trial exploitation, designing new wells, the conceptual design for the geothermal power plant, and finalizing the financial structure, with or without a partner, as well as internal organization.

Developing such a large-scale project also requires assembling top-tier, expert personnel, doesn’t it?

To proceed with trial and then full-scale exploitation, along with designing everything else necessary, Bukotermal will need to hire a certain number of experts, such as petroleum engineers, at the beginning of the year. According to the law on the exploitation of hydrocarbons and geothermal water, we are required to have them, as well as mechanical and electrical engineers. These experts will be involved in well design, power plant design, signing agreements with regulatory bodies like HROTE and HERA, and ultimately supervising all upcoming works—from trial exploitation, drilling new wells, pipeline installation, power plant construction, and more.

What is the final plan?

In the most ambitious scenario, the plan includes several production wells and injection wells, aiming for the maximum power output possible for this part of our exploitation field. Behind the power plant, a business zone covering approximately 15 hectares is planned. According to our conceptual design, this zone will feature greenhouses for cultivation of flowers, vegetables, and fruits. Naturally, in the future, depending on how the new EU budget period is structured, we hope there will be opportunities to invest in building heating pipelines for our communities, supplied by the geothermal power plant. This would allow us to distribute surplus heat to florists and the wood industry in the municipalities of Mali and Veliki Bukovec, or even to local residents, provided that funding for heating pipelines in rural areas like ours is sufficient.

Are there also plans for tourism-related activities?

The final piece, the icing on the cake, is investment in and the design of a spa tourism project. I hope we will succeed in creating the spatial, technical, and hopefully financial prerequisites—some of which we are already in place—so this aspect will not be neglected either. We will keep it in mind throughout the process and prepare the project to be ready for this phase as well.