Delayed Romanian Black Sea gas projects pose risk to pipeline
21/07/2020 17:19
BUCHAREST, July 21 (Reuters) - Romania's gas grid operator
Transgaz ROTGN.BX will likely finalise work on a European
Union-backed pipeline this year, but with no progress on tapping
offshore gas reserves it may have little to transport, an energy
regulator said on Tuesday.
The pipeline to connect Bulgaria, Romania, Hungary and
Austria (BRUA) and ease reliance on Russian gas will be able to
carry 1.75 billion cubic metres of gas in its first phase, which
cost an estimated 479 million euros ($550.4 million) to build.
"We hope BRUA will be finalised this year, but since we did
not solve Black Sea gas extraction, I am wondering what we will
be transporting through this pipeline," Maria Manicuta of energy
regulator ANRE told a Focus Energetic conference.
Several gas producers have spent years and billions of
dollars preparing to tap Romania's Black Sea gas, but were
blindsided by price caps, taxes and export restrictions pushed
by a previous centre-left government. urn:newsml:reuters.com:*:nL8N2AH2C3 urn:newsml:reuters.com:*:nL8N21E7OF
The current centrist minority government has overturned some
of the changes, but potential investors are still waiting for
tax changes on offshore projects.
In January, U.S. energy major Exxon Mobil XOM.N confirmed
it was weighing an exit from the long-stalled Neptun Deep
offshore project it holds jointly with Romania's OMV Petrom
ROSNP.BX . urn:newsml:reuters.com:*:nL8N2AI28M
Petrom, majority-controlled by Austria’s OMV OMVV.VI said
in April it remains committed to the project, but that it needed
the tax changes, as does smaller project Black Sea Oil & Gas,
controlled by private equity firm Carlyle Group LP CG.O .
"I am sure that ultimately BRUA will be used, but in the
very near future there is some risk," Manicuta added.
Unlike other countries in the region, Romania is almost
entirely energy independent. It typically imports a fifth of its
gas needs from Russia, with the rest produced locally, mainly by
state producer Romgaz ROSNG.BX and OMV Petrom.
($1 = 0.8702 euros)
(Reporting by Luiza Ilie; editing by Emelia Sithole-Matarise)
((luiza.ilie@thomsonreuters.com; +4021 527 0312; https://www.reuters.com/journalists/luiza-ilie;))