By Phelim MCAleer in Bucharest
The privatisation of Petrom, the Romanian state-controlled oil company, has got off to a strong start, with 15 expressions of interest from companies including Halliburton, TNK-BP and Occidental Oil and Gas.
A successful privatisation is expected to raise about $1bn for the government and is being closely watched by the IMF and the World Bank as a sign the government is committed to economic reform.
The government owns 93 per cent of the company and plans to sell a third of Petrom outright. The successful buyer must then buy newly issued shares to raise its stake to 51 per cent. The sale is scheduled to be completed by next March.
Petrom, an integrated energy company, has international exploration units that produce 6m tonnes of crude oil and 6.1 bn cubic metres of natural gas a year. It has two refineries and almost 700 filling stations.
Halliburton, the US oil services company, is leading a consortium of bidders, while Occidental Oil and Gas, Conoco Philips and Austria’s OMV have also sent letters of intent. TNK-BP, the Russina-British company and Russia’s Gazprom are also interested.
However, as Romania enters an election year, the government is under heavy domestic pressure not to sell Petrom to a Russian company.
Prime Minister Adrian Nastase recently said the company’s size and importance to the economy made the choice of future owners a political issue.
‘Whoever rules Petrom has an important voice in the economy, and whoever controls the economy, controls the politics,” he said. Mr Nastase added that who ever controls Romania’s politics controls the country’s future. “We cannot ignore this,” he said.
Announcing the bidders on Friday, Dan Popescu, the economy minister, said the future of the company was a matter of national interest. Petrom employs some 60,000 people and the possibility that a buyer might cut jobs could become a political issue in an election year.
The previous reformist government failed to sell the company largely because of electoral pressures.
(From the Financial Times 22/09/03)