Investments in the Romania’s Black Sea oil and gas sector will generate revenues of over USD 26 billion to the public budget and an additional USD 40 billion to the country’s GDP until 2040, as a result of total investments of USD 22.2 billion, according to a Deloitte report released on Monday.
Deloitte estimates a total production of close to 170 billion cubic meters of natural gas in Romania’s offshore fields, based on a prudent scenario.
These conclusions are based on an independent Deloitte Central Europe report entitled “The contribution of Black Sea oil and gas projects to the development of the Romanian economy”, performed at the request of the Romanian Black Sea Titleholders Association (RBSTA).
“The resulting estimates therefore show that each 1 billion USD invested in offshore oil and gas upstream activities in Romania generates 3.0 billion USD in the Romanian GDP over the upcoming 23 years of production. Moreover, it contributes with 1.9 billion USD direct and indirect revenues for the Romanian state, as well as creates and/or maintains, in average, an annual number of 2,198 jobs in Romania over the entire period,” the study estimates.
The study says that the impact on the labour market translates into creating and annually maintaining an average of over 30,000 jobs.
According to the study, the effect of successful upstream offshore developments would also spread to the midstream and downstream sectors – gas transmission and distribution – and other industries – chemical, petrochemical and gas to power -, where close to USD 9 billion investments would be possible following the gas surplus and the economic competitiveness that it brings.
“At least one million household consumers could be connected to gas distribution networks over the next 10 years. Currently there are over 3 million households not connected to gas networks,” Sorin Elisei, manager at Deloitte Consulting, told journalists.
According to Deloitte, the cumulated value of the future expenditures on Romania’s offshore exploration, development and production is estimated at USD 22.2 billion, out of which USD 15.7 billion capital expenditure (CAPEX) and USD 6.5 billion operating expenses (OPEX).
From this total investments, 63 percent are expected to be domestic (54 percent in case of CAPEX, 82 percent in case of OPEX).
Source: Business Review