Romania’s revised offshore law, more friendly with investors - study

The Romanian state will retain 60% of the profits generated by offshore gas exploitation projects, according to the amendments to the offshore law drafted by the Energy Ministry, down from 90% in the current form of the law, which was passed last year by the Parliament, according to a study by local law firm BirisGoran at the request of the federation of the investors in the oil and gas sector (FPPG).

“By the [proposed] amendments, the total share of the state (government take) reaches a more balanced level of approximately 60% of the profits generated in a standard offshore project, which offers a chance for the development of projects in the Black Sea," according to the study released on Thursday, September 26, quoted by local Agerpres.

However, it is important that the Government refrains from constantly changing the regulations, the authors of the study also say.

The study also reveals a conclusion that has been previously highlighted by industry representatives, namely that the taxation of oil and gas production in Romania is the highest in Europe. Moreover, it can be seen that the system of additional charges and taxation is not differentiated according to the difficulty of the operation or according to the technology used, therefore there is no fiscal incentive for the use of modern technologies (in mature fields).

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