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Oil and gas Employers’ Federation: We welcome the entry of offshore law into the parliamentary circuit
The non-competitive and unstable fiscal regime, as well as the frequent changes of the legislative framework and the introduction of specific conditions for the sale of natural gas affected the functioning of the natural gas market in Romania and led to the constant postponement of investment decisions in Black Sea resources, Show the oil and gas Employers' Federation.
‘The Employers’ Federation Oil and Gas (FPPG), organization which gathers the main producers of natural gas which covers over 98% of the domestic production, welcomes the reintroduction of the Offshore law in the parliamentary circuit. This first step is essential to ensure competition and stability to the fiscal regime with the respecting of the mechanisms of free market of natural gas as if, implemented, would allow the starting of the strategic investments in the production of resources from the Black Sea. Unlocking these legislative changes is indispensable not only for Romania’s energy security, but also for the regional one, especially in the new context of sanctions against Russia. The FPPG members are currently analyzing the proposals for amendments, both the ones which have been discussed in the public space and the elements of novelty and their impact on the developments of natural gas in the Black Sea, the FPPG position being finalized in the period to come’ FPPG says.
FPPG gathers the main owners of oil agrements in the Black Sea, after the integration of the Black Sea Oil and Gas company as member, completing the picture of the Romanian upstream sector both onshore and offshore.
‘The oil and gas industry is now at an important moment. In the geopolitical context, the need for the increase of the domestic production is a responsibility which the producing companies share as well as the decision-makers in the Romanian state and this responsibility is not only towards their own citizens, but to the whole European project Romania is part of. We welcome the Offshore law getting into the parliamentary circuit and we commit to a significant role in the dialogue which will be essential to establish a fair economic balance, necessary to the development of offshore gas as a compulsory condition for the consolidation of the national energy security and for the sustainable transition in the domain of energy’ the executive manager of FPPG, Catalin Nita.
He says that the non-competitive and unstable fiscal regime, as well as the frequent alterations of the legislative framework and the introduction of specific conditions for the trading of natural gas affected the functioning of the natural gas market in Romania and led to the constant postponement of the decisions for investments in the resources in the Black Sea.
‘By adding supplementary quantities which can be generated on the basis of the projects in the Black Sea, Romania can become the most important producer of natural gas in the European Union, once the Groningen deposit in the Netherlands is closed, the natural gas being an essential fuel in the energy transition and for the energy security of the country. Thus, the political decision for amendments of the offshore law proves to be one of high responsibility and the governing coalition has the merit to place the national interest before the individual objectives of the parties, which, although there are ideological differences, open a dialogue for the adoption of the best solutions to the present crises which Romania passes through’ the FPPG representatives said.
The effective rate of specific taxation of the income from the offshore gas production in Romania reached 51% in 2021, more than double to the previous year and ten times more than the European average in 2020, shows a FPPG analysis.