Romania Business Romania: OMV and Exxon in gas find
Romania: OMV and Exxon in gas find
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Good news for Romania – a “potentially significant” offshore gas disovery in the Black Sea.
It’s far too early to say whether it is a commercial proposition, but investors were excited enough by Wednesday’s announcement by project partners ExxonMobil and Austria’s OMV to move the markets. OMV shares rose by nearly 6 per cent before falling back to trade 4 per cent higher. ExxonMobil stock barely moved – perhaps even a big Black Sea find may not look that big in Texas.
It’s all very technical but the clue to the find’s importance is at the end – the reference to “several billion USD”. Even groups the size of Exxon don’t throw around such numbers loosely.
For Romania, it is particularly significant that Domino-1 is the first deep water exploration well in the Black Sea. While nothing is certain, it raises the possibility of further discoveries. That will be good for one of the EU poorer economies and for the Romanian oil industry, which has a proud history going back to the 19th century.
The discovery comes at an opportune time for Petrom, the former state oil company where OMV has 51 per cent. Reuters reported that Petrom missed analysts’ forecasts in its fourth quarter profits – posting 838m lei net ($255.3m), compared to predictions of 901m lei. Petrom recorded a profit of 781m lei in the year-ago quarter.
Petrom said its full-year net profits jumped to 3.76bn lei from 2.2bn lei in 2010, thanks to a 40 per cent rise in benchmark crude prices and a 1 per cent output increase. But, as it admitted, it was held back by a 504m lei fine imposed by the Romanian Competition Council, for alleged collusion with rivals in the withdrawal from the market of petrol type called Eco-Premium. It is challenging the fine in court.
(source: www.ft.com)
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