Romania’s government to speed up major natural gas projects

Romania’s government to speed up major natural gas projects
OMV Petrom and Romgaz are developing the Neptun Deep natural gas deposit in the Black Sea. / OMV Petrom
By Iulian Ernst in Bucharest September 22, 2022

Romania’s Minister of Energy Virgil Popescu has signalled that the government will do its best to speed up the two largest natural gas projects one onshore and the other offshore which are fully (the onshore project) or partially (offshore) managed by the state-owned company Romgaz.

Both the Neptun Deep project and the onshore deep Caragele field, which would cover Romania’s gas consumption for a combined period of up to ten years, have been delayed for years while the deadlines have been repeatedly postponed.

Firstly, Popescu expressed hopes that OMV Petrom and Romgaz would announce this year the investment decision related to the extraction phase of Neptun Deep natural gas deposit in the Black Sea, “considering the current context on the gas market”. 

Popescu, spoke on September 21 at the Romanian International Gas Conference, organised by the Romanian Oil and Gas Employers' Federation (FPPG).

“I expect and I wish the decision of Romgaz and Petrom to be taken as soon as possible …  including by the end of this year. I wish this because there is a special situation in the market. [More] natural gas is needed in the market and Romania can play a role. I think the Offshore Law is clear enough. I believe a decision will be made by the end of this year," said the government official.

Romania sweetened the Offshore Law earlier this year and Romgaz took over Exxon Mobile’s 50% stake in the Neptun Deep project, with an estimated reserve of 48bn-84bn cubic meters of natural gas.

Separately, Popescu said that Romgaz will begin extracting gas from its onshore deep Caragele field in 2024.

Discovered in 2016 some 100 km from Bucharest, Caragele field was initially supposed to come online in 2019.

Two years later, in 2018, the deadline was already deferred to 2021-2022.

More recently, this year, Popescu was speaking of 2023 as the most likely moment for beginning production at Caragele.

The deposit has an estimated accumulation of gas of roughly 25bn-27bn cubic metres, amounting to the country's entire consumption for up to three years. It was estimated at that time at a value of $4bn, but the natural gas price has tripled meanwhile.

Romgaz owns 100% of the concession contract for the perimeter located in Buzău County.