Page 8 - Euroil Week 46 2019
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EurOil INVESTMENT EurOil
Romgaz confirms talks on Exxon sale
ROMANIA
ExxonMobil has proposed a sale of its stake in the Neptun Deep project to state- owned Romgaz.
THE consultants hired by US group ExxonMo- bil to prepare its exit from the Neptun Deep off- shore gas project in the Black Sea have contacted Romanian state-owned gas producer Romgaz with a proposal, the company’s executive direc- tor Adrian Volintiru, told Profit.ro.
Exxon Mobil is the leading operator in the project and can only be replaced by a company with similar technological capabilities — mean- ing that even if Romgaz eventually becomes a partner in the project another big investor is needed to keep the project viable.
Separately, President Klaus Iohannis con- firmed on November 19 that Exxon answered his inquiry on this topic by saying that the sale of the participation in the Neptun Deep gas field operated with OMV Petrom off Romania’s Black Sea coast is part of a global strategy. However, Iohannis implied that this might not be the final decision of the US company. The president also said that Romania should thoroughly revise the legislation in the sector, starting from country’s interest and setting up a fair environment for investors as well.
Romgaz’s Volintiru confirmed to profit.ro that the Romanian company is interested in buy- ing a 15-20% minority stake in the project that ExxonMobil is developing together with OMV Petrom under a 50:50 arrangement.
“We are interested, it is true, but it is a mul- ti-step process that must be undergone before making the final decision,” Volintiru said.
In case Exxon wants to recover the invest- ment made so far in the project, of approxi- mately $750mn, Romgaz would have to pay about $220mn-300mn for a 15-20% stake. Addi- tionally, another U$3bn needs to be invested in the project by 2025, to which Romgaz would be expected to contribute around $450mn-600mn. This would add to other major investment pro- jects Romgaz has under development or in the pipeline, including the Mintia gas fired power plant, the contribution for its 12% stake in Tri- dent offshore gas project (developed by Lukoil), and the contribution to the Alexandroupo- lis LNG terminal in Greece. In 2018, Romgaz investments amounted to RON1.2bn (approx- imately $250mn).
POLICY
Poland notifies Gazprom of plan to end gas supply deal after 2022
POLAND
Poland was required to give Gazprom three years’ notice.
POLAND’S main gas company PGNiG said on November 15 it had notified Russia’s Gazprom that it did not intend to extend their long-term deal on gas supplies when it expires at the end of 2022.
Poland has said before it wants to stop buy- ing gas from Gazprom on a contractual basis after 2022, relying instead on LNG imports and gas deliveries via a new pipeline from Norway it is developing. But its agreement signed with Gazprom in 1996, known as the Yamal contract, requires that the pair formally submit declara- tions regarding future co-operation three years before the deal terminates.
“Over the past four years we have taken a number of important steps to diversify the sources of natural gas supply to Poland,” PGNiG president Piotr Wozniak said in a statement. “We have concluded long-term LNG supply contracts and have been acquiring natural gas deposits on the Norwegian Continental Shelf [NCS], which, combined with the activities of the transmission
system operator to expand the gas pipeline sys- tem, makes it possible for us to terminal the Yamal contract on the originally set date.”
Poland opened its first LNG import terminal, a 5bn cubic metre per year facility in Swinoujs- cie, in late 2015. The terminal has seen record use this year, partly because of low international LNG prices, taking ashore 2.48 bcm of gas in Jan- uary to September, up 27% year on year. These supplies covered 23% of Polish demand over the period, versus 18% a year earlier.
In contrast, Russian imports fell 21% in the first nine months of this year, totalling 6.29 bcm. They met 58% of Polish consumption, compared with 75% in the same period a year earlier.
Plans are underway to expand the Swinoujs- cie plant’s capacity to 7.5 bcm per year by 2021 as well as construct another 4 bcm per year import terminal in Gdansk. Poland’s Baltic Pipe project should also be up and running by 2022, carrying up to 10 bcm per year of gas from PGNiG’s fields off Norway to Poland via Denmark.
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w w w . N E W S B A S E . c o m Week 46 21•November•2019
