Deloitte: Capping natural gas price might trigger infringement procedures against Romania

Romania risks being investigated by the European Commission (EC) for violating the Gas Directive and the provisions of the Government's emergency ordinance (OUG) 114/2018 could be interpreted as illegal state aid granted to industrial consumers, representatives of consultancy firm Deloitte and petroleum companies’ association ROPEPCA said in a press conference on Tuesday.

Deloitte drafted a report to assess the impact of OUG 114, for ROPEPCA.

The European fertilizer producers’ association has already expressed concern that in some countries the natural gas price is lower or set at a local level, Deloitte’s expert Sorin Elisei informed, according to local Agerpres. There is a risk that companies in other countries ask the Commission to investigate the situation, he explained.

The process behind capping the natural gas price at the level set by OUG 114 lacks transparency, and the price itself is significantly below those in other countries in the region. This gives an unfair advantage to local producers and discourages potential investors in the production sector, Elisei added.

ROPEPCA president Saniya Melnicenco said that association’s members have already cut their investment budgets by 30%-35%.

“The measures [included in OUG 114] are highly anti-competitive and breach the European gas directives. We know that the European Commission has already been notified in this respect, including by ROPEPCA, which has sent a letter to the European Commission on this topic. The domestic producers are disadvantaged compared to the whole economic chain. Higher market competition can be achieved only by the emergence of new operators, but this requires a stimulating environment for new upstream investments,” Melnicenco said.

Separately, the state budget revenues will drop by RON 2.26 billion (nearly EUR 500 million, 0.25% of GDP) following the impact of OUG 14 provisions related to the natural gas sector alone, ROPEPCA stated quoting the results of the Deloitte report, Agerpres reported.

(Photo source: Transgaz.ro)