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Is there hope for the Black Sea region?

BLACK SEA
OIL & GAS

Is there hope for the Black Sea region?

You know everything about the Black Sea region already.

There are no new business opportunities and no future for oil & gas production. Government is tightening the industry with new regulations, big international oil & gas companies are leaving, and there is no change in any foreseeable future.

BUT WHAT IF THE CHANGE IS TAKING PLACE? 

There is a summary of recent market trends & developments.

OFFSHORE LAW

Offshore Law is set to be amended once again… now in favor of oil & gas producers though. Energy Ministry has launched to public debate a draft law to radically amend the Offshore Law, which includes:

  • Removing additional taxation of revenues for the selling prices where investors don’t generate superprofits (ranging from RON 45.71/MWh to RON 100/MWh).
  • The reference price used in determining the calculation basis of the additional revenue tax is also removed. 
  • The maximum level for deducting investments in the upstream sector to set the additional offshore tax is increased from 30% to 60%.
  • The trading obligations on the centralized markets in Romania on the medium and long term are also abolished.

TENDERS

Oil & gas exploration and production tenders are on the rise, giving a chance to new offshore and onshore companies enter the market: 

  • In July 2019, (NAMR) announced the 11th concession round in Romania. 22 blocks are located onshore across all regions of Romania, while 6 blocks are offered offshore on the Black Sea. 
  • Also in July 2019, Bulgaria’s government announced the opening of a tender for five-year oil and gas exploration permit for Block 1-26 Tervel, in the country’s sector of the Black Sea.
  • In 2019, Ukraine ran massive licensing rounds for 35 onshore and 1 offshore block. See the results
  • Georgia expressed interest in attracting foreign investors with an open international tender for 6 onshore areas announced earlier in 2019. 

PROJECTS

Despite the regulatory pressure, some of the largest gas exploration & production projects in the region are going ahead: 

Relevant news

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