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Romgaz to bid for ExxonMobil’s 50% stake in Black Sea in two months

Romanian Energy Minister Virgil Popescu announced that state-owned natural gas company Romgaz will submit a bid to take over the 50 per cent stake of US energy group ExxonMobil in the Black Sea natural gas project, Neptun Deep. The offer could come in the upcoming two months until the incumbent interim CEO’s term expires wrote Romania-Insider. Mr Popescu also confirmed that gas extraction from the Neptun Deep perimeter could start in 2025 according to their expectations.

The Minister underlined that the first Romanian gas molecule in the Black Sea will be drilled already this year by the Black Sea Oil&Gas company (BSOG) from the Aurora perimeter, holding an estimated 10 billion cubic metres (bcm) of gas. The Neptun block is estimated to contain natural gas resources of approximately 42 to 84 billion cubic metres (bcm), which is equivalent to three to six times the annual Romanian consumption.

The gas field is being jointly developed by OMV Petrom, majority-controlled by Austria’s OMV and ExxonMobil Exploration and Production Romania both holding a 50 per cent share in the project. ExxonMobil announced its decision to exit the project in 2019. OMV Petrom has also delayed a final investment decision due to the offshore law adopted in late 2018 by a previous centre-left government, introducing a series of price caps, taxes and export restrictions.

Energy Minister Virgil Popescu said that he was confident that the parliament would amend the offshore law in this parliamentary session. He also said OMV Petrom could start extracting gas from Neptun Deep by 2025.

“We have a 4-year break to conclude investments in the energy sector into new production capacities, distribution and transport network,” said Mr Popesco pointing out that the gas coming from the Black Sea could not only cover Romania’s domestic consumption but offer an alternative supply source for the region.

The Minister expressed confidence that Romgaz can handle the project and confirmed that Romgaz, a company owned 80 per cent by the Romanian state should come to take over this 50 per cent stake of ExxonMobil.

Tapping the gas reserves of the Black Sea would be a game-changer not only for Romania but also for the energy security of the whole region. During his recent visit to Bucharest, Hungarian Minister for Foreign Affairs and Trade, Péter Szijjártó also emphasised that launching gas exploration on the Romanian territories of the Black Sea as soon as possible was a common interest of the two countries.

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