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Fees versus surcharge. How will position the state to OMV Petrom?

Jun 3rd 2015 at 1:55 AM

The new oil and gas royalties should be set after the presidential election, are recommending Ponta Cabinet ministers. The current fees set for a period of 10 years, expiring in December 2014, so there are a few months until the authorities must decide how to position the caliber investors in Romania.

The president and the prime minister argued, strongly years ago, increasing royalties on natural resources. Prime Minister Victor Ponta see their high European average, while Basescu is expected that, in 2014, the fee for Petrom to be like in Arab countries! Came 2014 and authorities' position is more reserved now, no more concrete statements on this hot topic. NAMR President, George Dutu, said recently that the level of fees charged by the state for oil and gas will increase dramatically in new legislation in this area, but will be differentiated depending on the type of ore that are extracted hydrocarbons.

Currently, companies that produce oil and natural gas pay royalties contained 3.5% and 13.5% of production, depending on the type of hydrocarbon deposits. Annually, the state budget is one billion lei collect petroleum and mining royalties.

The discussions / decisions on oil royalties behave in a time when the Austrians from OMV feel the burden of taxes too often modified by the Romanian state. For the first time since being on the Romanian market, Petrom owners have bad news: they decreased profit in Romania.

OMV Petrom recorded a net profit of 1.38 billion in the first half of 2014, down 42% compared to the first half of last year, when net profit was 2.39 billion, according to a company press release.

If OMV Petrom, post tax and additional tax revenues liberalization of gas prices equaled a 90% increase in royalties paid by the oil company, according to company calculations. In the first half, OMV Petrom has paid to the state budget about 370 million lei, of which 162 million lei were pole tax. The company also has paid taxes and dividends in the first half total of 5 billion lei, the equivalent of 11.3% of state budget revenues, stated in a statement. Q

As a result, gross OMV Petrom matter of 50% in profit parent company in Austria.

However, the company's investment plans will continue, give assurances OMV Petrom representatives. "The demand reduced oil and gas, combined with additional taxation introduced in 2013-2014, largely neutralized the benefits resulting from the liberalization of gas prices. However, considering the long cycle of investment in oil and gas and assuming a future fiscal and regulatory framework favorable to investment, we will continue the projects, focusing particularly on the exploration and redevelopment fields, both onshore, and offshore, "said Mariana Gheorghe, CEO of Petrom.

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