Oil & gas industry in Romania
Adresa
Bulevardul Nicolae Titulescu, Nr. 4-8
Cladirea America House Aripa de Vest, Etaj 4
Bucureşti, Sector 1
Telefon
+40-21-206.23.00
Fax
+40-21-206.23.10
Website
www.efgfinance.ro
Oil industry overview
At a glance: Crude-rich country, still net importer
- Romania is the CE Europe’s most oil-rich country, still a net importer with supplies coming mainly from Kazakhstan and Russia;
- Requirement for Romania to comply with EURO 5 standards starting with January 2009 (2 years later than the EU countries) forced players to accelerate investments in technology;
- Major changes in the sector were Petrom’s privatization with OMV at the end of 2004 (that resulted in a price increase of the oil refined and petrochemical products to a level close to the CEE one) and the acquisition of Rompetrol Rafinare by KazMunaiGaz in 2007;
- Romania’s natgas reserves stood at roughly 887 mn boe and crude reserves at some 469 mn boe in 2010.
Industry structure Crude production and imports c 40% and 60% respectively
Total crude supply absorbed by Romania’s refining system increased during 2004-2005 and afterwards entered a regression phase on the back of economyrestructuring and adverse environment, albeit positively accompanied by improved quality norms. The expected economy growth this year, even modest - if achieved, will have a favourable impact on the sector by helping it to gradually enter a recovery process.
Crude imports topped a 65% weight in 2008, with both production and imports recording a regress because of international and domestic economy downturn.
Crude oil & natgas reserves: According to the Romanian Government’s Proposed Energy Sector Strategy for 2011-2035, the country has roughly 887 mn boe natural gas reserves and 469 mn boe reserves of crude oil. The figures most likely represent only the 1P reserves, while there is no information on the year the reserves were audited.
Crude production: Petrom stands as Romania’s main crude oil producer with a 98% weight.
Both in 2009 and 2010, and most likely this year as well, the domestic crude production (sour type) has entirely entered Romanian refineries for processing.
Crude refining and related facilities - Crude refined by two refineries basically
According to our computation, most of the domestically produced crude and imported quantities were refined by OMV Petrom (in Petrobrazi refinery) and Rompetrol Rafinare (Petromidia refinery).
These jointly accounted for c. 83% of the crude that we estimate it was refined in Romania in the first six months.
Romania has in total 8 refining facilities, the most important being Petrobrazi (Petrom’s other plant Arpechim is presently shutdown to be further divested), Petromidia (owned by Rompetrol) and Petrotel-Lukoil.
Except for Rompetrol Vega (re-oriented to produce solvents), all others are in a poor financial situation, with unclear shareholding structure or in liquidation. Petrom presently processes only domestic crude, while Rompetrol and Lukoil – imported crude.
Oil-Refined products delivery - Domestic production leads the market
Based on the latest data available, in the first five months of this year, the domestic market absorbed a total of 3.2 mn tons of oil refined products. As much as 4.4 mn tons of refined products were produced in Romania in the period, 0.7 mn tons were imported while 1.7 mn tons were exported. The balance represents own consumption and stock variances. In the first 5 months, delivery slightly increased to 3.2 mn tons, from 3.1 mn tons a year before.
