Romania’s Romgaz said it has agreed with OMV Petrom and Poland’s PGNiG to make a joint offer for Exxon Mobil’s 50% stake in a long-stalled offshore natural gas project in the Black Sea if the U.S. company decides to sell.
State-owned Romgaz would then be interested in holding a 20% stake in the Neptun Deep project, Chief Executive Adrian Volintiru said.
Exxon confirmed in January it was weighing an exit from the Neptun Deep project. The other half of the project is owned by Romania’s OMV Petrom, which is majority-controlled by Austria’s OMV.
“We have the appetite to acquire 20% of Neptun Deep should Exxon decide to sell,” Volintiru told an energy seminar organized by financial daily Ziarul Financiar, and said Romgaz had signed a joint binding agreement with OMV Petrom and PGNiG to partner in buying Exxon’s stake.
Romania’s economy minister said on Monday he was confident Romgaz would be part of a consortium to buy Exxon’s stake.
Romgaz also holds a 12.2% stake in a separate offshore joint venture in the Black Sea led by Russia’s Lukoil.
Several gas producers have spent a decade and billions of dollars preparing to tap Romania’s Black Sea gas, but they were blindsided by price caps, taxes and export restrictions pushed forward by a previous center-left government.
Romania’s current Liberal minority government is running the European Union country on an interim basis after it lost a no-confidence vote earlier this month. Prior to the no-confidence vote, it had begun undoing some of the legal and tax changes that had raised concerns with investors.
Whereas Neptun Deep is still awaiting an investment decision pending legal changes, another Black Sea oil project, Black Sea Oil & Gas (BSOG), controlled by private equity firm Carlyle Group LP, has been almost finalized. It could start producing roughly 1 billion cubic meters of gas per year in 2021 with some delays, BSOG told the same seminar.
“It’s vital to us that by the time we start producing first gas these things (tax and legal changes) will be resolved,” BSOG chief executive Mark Beacom told the conference. “We have two years to get this sorted.”
Meanwhile, Romgaz’s Volintiru said the company was also hopeful about new onshore gas discoveries. In 2017, Romgaz announced its biggest find in three decades in the Caragele field, in the central Romanian county of Buzau, with an estimated 25-27 billion cubic metres of gas.
“We have hopes that somewhere in Bucovina in eastern Romania there could be a very large field, comparable to Caragele, but we need to do some more digging to confirm,” Volintiru said.