Agreement on Black Sea natural gas
Romgaz has reached an agreement with ExxonMobil for a stake in the Black Sea Neptun Deep Project
Roxana Vasile, 27.10.2021, 13:50
In full chaos on the world electricity and gas market, the announcement made on Tuesday, in Bucharest, came as a ray of hope: the natural gas producer Romgaz, the largest state-owned company listed on the Bucharest Stock Exchange, controlled through the Ministry of Energy, and ExxonMobil have finalized the negotiations for the full takeover, by the Romanian company, of the 50% stake of the American oil giant in the Neptun Deep Project for the exploitation of natural gas in the Black Sea.
The transaction, the value of which has not been made public, is expected to be completed in the first quarter of next year. Currently, ExxonMobil and OMV Petrom are equal partners in the offshore gas project. The Black Sea is said to host some 84 billion cubic meters of natural gas. Romanias annual consumption stands at 11 billion.
Upon completion of the transaction between ExxonMobil and Romgaz, OMV Petrom – the largest energy company in the south-east of Europe – would become the operator of the Neptun Deep perimeter. Its development would mean the first production of hydrocarbons in deep waters in Romania. The costs of such a deep-water project can reach several billion dollars. The Neptun perimeter is 200 kilometers off land, and all infrastructure, including the pipelines, must be built.
Recently, the specialized publication Petroleum Economist, quoted by profit.ro, has estimated that a transaction between Romgaz and ExxonMobil could unlock Romanias offshore potential and could turn it into the largest gas producer in the European Union by the end of this decade, with the exploitation of the reserve starting in 2026. Romania could become independent of Russian gas and even export 20-25% of the domestic production.
Moreover, regional competition will grow. “I am confident that, in the near future, Romgaz and OMV Petrom will be equal partners in the Neptun Deep project. Important steps have been taken for the Black Sea gas to reach the Romanians homes”, the interim Minister of Energy, Virgil Popescu, wrote on Facebook. In Bucharests vision, a future partnership between Romgaz and OMV Petrom in the Neptun Deep offshore project would be essential for both the countrys energy security and for achieving the goals on energy transition, one of the focal points for discussion these days. (MI)
