Oil companies "will be overcharged in 2013"

Minister of economy, Daniel Chiţoiu, said on Wednesday that the Government is preparing a draft law relating to revenue windfalls overcharge of oil companies, which would have to be approved before the end of the year and implemented in 2013.

"The law will not apply in 2012, but from 2013," said Daniel Chiţoiu.

The Minister of Economy said that royalties on natural resources will be made available to the European level.

On May 7, he said that the Government might introduce a tax on the exceptional revenues of companies and that royalties from oil and gas are too low.

Oil and gas royalties of between 3.5 per cent and 13 per cent of production are fixed from 2004 until December 2014.

These fees have been established by the privatization contract of Petrom with Austrian company OMV group.

The annual budget of the Federal State and the petroleum mining royalties amounted around payment of one billion lei (225 million euros).

The main companies in the oil and gas sector in Romania are OMV Petrom, Rompetrol (owned by Kazmunaygas of Kazakhstan), Lukoil (Russia), MOL (Hungary), Eni (Italy) and Gaz Medias.

Gas production is covered in almost equal proportions by Gaz and OMV Petrom.

OMV Petrom is the only company extracting oil in Romania, having this right through the privatization contract by OMV Austrian group in 2004.

Group OMV Petrom and doubled net profit in the last nine months of the year 2011, reaching 2,921 billion lei (694,5 million euros), and exceeded last year's record profit.

Group sales rose by 23 percent to 16,224 billion lei (3,857 billion euros) due to favourable prices of crude oil and optimize operational activities.

On 2010, Petrom has reported a record profit of 2.19 billion lei.


Translated by
Denisse-Meda Bucura
MTTLC, Bucharest University