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Romania’s Romgaz mulls tie-up with Socar for Black Sea offshore projects

BLACK SEA
OIL & GAS

Romania’s Romgaz mulls tie-up with Socar for Black Sea offshore projects

BUCHAREST (Romania), January 21 (SeeNews) – Romanian natural gas producer Romgaz said on Monday it is considering a partnership with Azerbaijan’s oil company Socar in off-shore projects in the Black Sea.

The involvement of the Azerbaijani company with Romgaz in major projects would open the road to Romgaz’s expansion on international markets, the company said in a press release.

“A partnership with a big company such as Socar is important to us, because it will bring major benefits not only to Romgaz but to the energy sector and to the national economy as a whole. Romgaz wants to expand its business on external markets and is exploring new opportunities and identifying optimal and effective ways of expansion,” Romgaz general manager Adrian Volintiru said following a meeting with Socar’s representatives in Azerbaijan.

Azeri officials have shown interest in offshore exploration and exploitation of hydrocarbons in the Black Sea, in case Romgaz decides to engage in this kind of operations.

Also, the two companies discussed the possibility of collaborating on projects related to the Trans-Anatolian Natural Gas Pipeline (TANAP) and the TransAdriatic Pipeline (TAP).

With a length of 1,850 km, TANAP will link Georgia with Greece across the territory of Turkey. The initial capacity of the TANAP pipeline would be 16 billion cubic meters per year. It would grow to 23 billion cubic meters in 2023 and 31 billion cubic meters in 2026. The project is 58% owned by Socar, while 30% is held by Turkish energy company Botas.

TAP has a length of 870 km and is to be the last section of the Southern Gas Corridor. It will allow the transport of natural gas from Turkey to Italy via Greece and Albania. In 2020, when the first gas delivery to Europe is scheduled to take place, TAP will be the first non-Russian gas pipeline to supply Europe after Medgaz’s connection, which in 2011 started supplying gas from Algeria to Spain.

“Meetings will continue in the coming period to materialize what has been discussed. We are thinking of sharing our know-how and expertise on gas storage activities, as the two companies are similar – we both have large storage capacities (3 billion cubic meters) and intentions to develop this activity in both countries,” Volintiru said.

Socar is involved in the exploration of oil and gas fields, processing and transport of petroleum, of gas and condensed gas as well as on petroleum and petrochemical products trading on domestic and international markets. It also supplies natural gas to industrial and household consumers in Azerbaijan.

In November, Romgaz said will increase its output by the end of the year on the back of stepped-up pumping in the Caragele field. Caragele is the largest onshore natural gas field discovered in the last 30 years in Romania, with estimated reserves of 25-27 billion cubic meters of gas.

Romgaz plans to invest 45 million euro ($50.8 million) in Caragele to drill 15 wells and install surface technological equipment at 10 wells. The company believes that investments in the area could reach up to 100 million euro, mainly for boreholes meant to confirm or potentially increase the volume of the estimated reserves.

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