- Romania | 11 July 2019
Romania has a long history in the oil & gas field. What is your assessment regarding the current state of the industry?
Romania’s history in the oil and gas industry dates back many years, but in modern times, it gained global attention with the privatization of Petrom in 2004, when a small Austrian company, OMV, acquired the Romanian giant. This event sparked interest and led to other companies entering the local market, such as ExxonMobil, attracted by significant discoveries in the Black Sea. This paved the way for a dynamic industry that we have today, with companies like Schlumberger, the world’s largest oil and gas service provider, moving their headquarters to Bucharest, and new players like Winstar Satu Mare (Serinus Energy Romania), Expert Petroleum, Hunt Oil, and Mazarine Energy joining the production sector.
What is your assessment of the current state of the oil & gas industry in Romania?
The industry looks promising at the moment, but there are challenges that need to be addressed. One major issue is the lack of human capital, particularly in fields like geophysics, where there is a scarcity of qualified professionals. Fewer students are graduating in these areas, even though Romania’s Geophysics and Geology University is renowned worldwide. This gap is partly due to the perception that the energy industry is not very attractive to young people who are more interested in office jobs. However, the reality is that the industry offers a wide range of opportunities and relies on creativity and innovation to overcome challenges and produce faster and more efficiently.
What does the Petroleum Club of Romania do to address these workforce issues?
In terms of workforce, the Petroleum Club of Romania maintains close relationships with The Oil & Gas University in Ploiesti and the Geophysics and Geology University in Bucharest. We actively promote the industry and generate interest among young people. We also encourage our members to contribute to these schools by funding lab equipment or offering internship programs, so that students can gain practical experience and better understand the industry.
What are the areas in which legislation needs improvement in the oil & gas industry in Romania?
The Petroleum Club of Romania was directly involved in drafting the Petroleum Law 15 years ago, which provided a better framework at that time. However, a revision of this law is needed to address current issues. For example, environmental issues need to be covered more extensively, topics such as land access and fracking need to be addressed, and offshore concessions need careful consideration. The situation has changed significantly since the Petroleum Law was drafted, with the recent Offshore Law being a topic of much debate and dissatisfaction among all parties involved. Therefore, it is necessary to reassess the legislation and fill in the gaps that exist.
What challenges do you face in terms of legislation in the oil & gas industry in Romania?
Legislation is a delicate issue in Romania, as many laws are passed through Emergency Ordinances that seem to be drafted to serve specific interests, which can spill over into other sectors. This ad-hoc legislation often lacks proper assessment of its impact, resulting in incoherent legislation across sectors and creating an unstable and unpredictable fiscal environment for the energy industry. This lack of security for investors is far from ideal and is exemplified by the recent GEO 114/2018.
How do you suggest addressing the issue of legislation in the oil & gas industry in Romania?
As a last resort, lawsuits at European Courts may be necessary to address the issue of legislation. Many of our members are exploring all options available to them and are prepared to defend their rights that were won through negotiation and contract signing. While it may seem radical, litigation may be inevitable unless the situation changes.
