The changes proposed by the Government to the offshore law encourage energy companies

By Edwig Ban
Several companies in the energy sector show that the position of the authorities, considering the modification of the offshore law, is an important step forward in the development of the Black Sea project.
“The Black Sea gases are a necessity and a great opportunity for Romania. The development of offshore projects will provide security in Romania’s gas supply, will contribute to the increase of the revenues to the state budget, will generate investments and jobs. In the last year, we have constantly shown the prerequisites for such major projects, with high investment risks. These are: fiscal stability, competitive framework, a liberalized gas market and the development of gas infrastructure. The fact that the authorities are considering changing the oil and gas legislation. is an important step forward. The reopening of the dialogue on a fundamental topic for Romania is welcome “, says OMV Petrom.
The offshore law will be amended, according to a draft law drafted by the Government of Romania and put into public debate on Friday.
The new bill means some news that may be considered less burdensome for oil companies that want to extract gas from the Black Sea. The tax system becomes more friendly, the additional tax is applied only at a price level of over 100 lei / MWh, the oil companies receive the permission to sell the gas and through direct contracts, the deductibles increase, and the taxes will no longer apply to the price. reference from the Vienna hub.
In the mainland area of the Black Sea there are two major projects. The first, in the deep water area, run by Exxon and OMV Petrom (50% each), where potential reserves of gas up to 84 billion cubic meters were discovered, and the second, by the American investment fund Carlyle, through Black Sea Oil and Gas (BSOG), in the shallow area, which has a potential of between 10 and 20 billion cubic meters.
ExxonMobil and Petrom had to announce last year whether they would make the final investment decision on commercial exploitation, but the decision was delayed because the offshore law was adopted too late and increased the tax burden on companies. Exxon and Petrom have already invested $ 1.5 billion in Black Sea exploration.
Carlyle announced that he had made the investment decision, but made the future deliveries conditional on changing the legislative framework.
According to the estimations of the officials of Bucharest, there are about 200 billion cubic meters of gas reserves in the Black Sea only on what was developed from a commercial point of view, that is the three perimeters owned by Lukoil, ExxonMobil and OMV Petrom, respectively Black Sea Oil and Gas.