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February 8, 2019 www.intellinews.com I Page 2
Investors split over Romanian Black Sea projects in “illiberal” climate
gas producer OMV Petrom remain committed to the Neptun Deep offshore project in Romania’s deep waters, but “the country’s political risk has increased” and investors “must regain confi- dence” before going ahead with their projects, OMV managing board member Manfred Leitner said on February 7 at a press conference with investors, quoted by Profit.ro.
OMV itself, beside its partner ExxonMobile, has
to decide on a major investment in Romania’s offshore, after it found reserves evaluated at between 48bn and 84bn cubic metres (cm) of gas. The decision was postponed from last year.
Romania departing from a liberalised market model is a bigger concern than the capping, for a certain period, of the price of natural gas, the OMV representative stressed. The local gas mar- ket “is going illiberal”, thus depressing investors’ confidence, he added.
OMV Petrom is continuing to discuss with the Ro- manian government about “fair regulations” that would make the investment decision possible.
"What we need is, of course, much greater fiscal stability. I do not want to see any more surprises like the one I saw on December 29 [emergency decree 114/2018]. We need competitive terms, we need a liberalised gas market, and we must, of
course, have the key infrastructure in Romania
to export our volumes, because this project is designed for Europe, not exclusively for Romania,” Leitner concluded.
Midia project to go ahead
On the same day, the operator of the other major natural gas project in Romania’s offshore, Black Sea Oil&Gas (BSOG) announced that it would go ahead with its $400mn Midia Gas Development Project. The project is the first new offshore gas development project in the Romanian Black Sea to be built after 1989.
Earlier this month, the independent oil and gas company, owned by Carlyle International Energy Partners and the European Bank for Reconstruction and Development (EBRD),
told Reuters that new taxes introduced by the government at the end of December 2018 could make it hard to go ahead with the development.
The investment decision has been taken “on the assumption that BSOG and its joint venture part- ners will successfully be able to restore all of their rights with respect to the removal of any newly imposed supplemental taxes and fees as well as removing any restrictions.”
Opposition to Nord Stream 2
Romania will both meet domestic demand and export gas to neighbouring countries once major offshore projects start commercial production.
Meanwhile, Romania has opposed the Nord Stream 2 pipeline. Together with Poland and the Baltic states, Poland warns Nord Stream 2 would only increase Europe’s dependence on Russian gas. As the current holder of the EU’s rotating six- month presidency, Romania is seeking to ensure