Rompetrol Group NV, Romania’s second- biggest oil company, will exit Albania to
focus on more- profitable Balkan and former Soviet states as its Kazakh parent
company seeks markets in which to sell its increased output.
The Amsterdam-based company, which is wholly owned by KazMunaiGaz
National Co., will close its four Albanian units it and increase activities in
Georgia, Moldova, Bulgaria, Ukraine, Serbia and its home market in Romania,
Rompetrol Chief Executive Officer Saduokhas Meraliyev said in a Nov. 26
interview.
KazMunaiGaz, which pumps a quarter
of Kazakhstan’s oil output, is working to raise oil production to 25 million
metric tons by 2015 from 18.7 million tons last year. A stronger presence in the
Balkans and elsewhere in east Europe, through its Rompetrol subsidiary, and in
Asia will help the company boost profits, said Meraliyev.
“We decided to streamline our
operations” to focus on more-profitable markets, Meraliyev said. “This
restructuring project touches our activities in five countries and all the
business entities there, and 2012 is our target to accomplish
that.”
Kazakhstan’s state-owned oil and
gas company bought 75 percent of Rompetrol Group, which was valued at $2.7
billion, in August 2007 to gain a “footprint in important downstream markets in
Europe,” and double its refining capacity. In 2009, it bought the remaining 25
percent from the previous owner, Dinu Patriciu, Romania’s richest man, according
to Forbes.
Loan Payback
The Kazakh owner is pressuring Rompetrol to return to
profitability as a $1 billion loan approved last year has to be paid back by
August. Chief Financial Officer Dmitry Grigoryev said in a Nov. 19 interview
that the Romanian unit will miss the break-even target for next year, posing a
group loss of about $40 million for that year.
To help improve its productivity,
Rompetrol plans to use as much as $350 million by October 2011 to upgrade its
Petromidia refinery, which is 45 percent owned by Romania, and boost capacity to
5 million tons per year from 3.6 million tons now.
Domestically, Rompetrol has “huge
ambitious plans,” he said. It plans to have 170 gas stations of its own by 2014,
compared with 131 now and 800 points of sale with its distributors and partners.
That compares with its main competitor, OMV Petrom SA, which has a total network
of 546 distribution stations, and OAO Lukoil of Russia with 310 stations, he
said.
Expansion ‘Idea’
“Our idea is to expand, especially in Bucharest,” Meraliyev said.
“Now we are struggling to get the construction permits.”
Across the Balkans, the group owns
48 units. It is seeking to cut the size of the network by merging or closing 14
companies “in the near future,” he said.
It also plans to upgrade a terminal
for loading and uploading oil in Bulgaria, where it has “very good results,” and
is looking at the possibility to increase its capacity if the Kazakh owner
approves a plan to enter the Serbian market, Meraliyev said.
“ There is some intent by the
Serbian government to open the gasoline market, which is prohibited today
because they use the products from Serbian refineries,” said Meraliyev. “Already
we have prepared a short list of three potential partners for
that.”
‘Attractive Market’
Rompetrol also wants to increase its activities in Ukraine, which
is a “very attractive market,” though it has problems with loading and unloading
products in that country’s ports, he said. It is also satisfied with
developments in Georgia and plans to increase the number of gas stations in
Moldova to 60 by the end of next year from 40 stations now.
The company is ready to support a
planned $3.5 billion oil pipeline from the Black Sea port of Constanta to
Trieste in Italy, he said, and plans to use its existing marine terminal in
Navodari as a starting point for the project.
In 2007, Serbia, Croatia, Romania,
Slovenia and Italy agreed to build the 1,400-kilometer (870-mile) pipeline.
Rompetrol can accommodate 24 million tons of oil per year through that terminal
and needs only 5 million tons for its own production, said Meraliyev. The rest
can be sold off to other local producers.
“It’s our dream, it’s my dream and
we share our vision with the authorities,” Meraliyev said.
(Bloomberg)