Romanian state-controlled natural gas company Romgaz reported a 13.4% drop in its H1 revenues to RON 1.9bn [EUR 432mn], Ziarul Financiar daily reported. Its revenue must have been pulled down by the shrinking market that contracted by 11.4% y/y in H1, according to the statistics office data.

Nonetheless, Romgaz H1 net profit surged by 38% y/y to RON 771.4mn [EUR 173mn] thanks to lower operational expenses, lower imports of expensive gas and lower amortisation and depreciation expenses – as explained by the company’s management.

The main driver for Romgaz profits, not mentioned by officials, is however the liberalisation of the natural gas price. The price of the domestic natural gas, which was last year equal to roughly half of the price paid for the imported Russian gas, is going to be gradually increased to levels comparable with the import prices.

The convergence was expected to be reached by the end of 2014 for non-residential users, but the process might have to be extended by another year, the government said recently. A final decision in this regard will be taken next year.

Romania’s government plans to float Romgaz shares on the local and a foreign exchange and sell a 15% stake under an IPO scheduled by the autumn of 2014. Government officials mentioned the option of organising the IPO this year, but technically this is rather difficult and would not allow thorough evaluation of the company’s gas resources under operation.