Romanian government expected to raise royalties in 2015

Romania’s current royalty rates range between 3.5% and 13% (averaging between 7% and 8%), and this number is likely to increase in 2015.

Established in 2004, the country set its royalty terms with a 10-year stability agreement that will expire at yearend. According to consulting firm GlobalData, changes in the country’s fiscal regime will raise average royalties to at least 10% for the medium term of a new framework that will be introduced at the start of 2015.

The firm said the Romanian government will establish different rates for onshore and offshore fields. “This will allow the country to raise its take from onshore production, while at the same time offering an attractive climate for exploration in the Black Sea, where costs are high particularly for deepwater areas,” said Will Scargill, upstream fiscal analyst at GlobalData.

The government also may apply specific rates for unconventional operations to provide incentives for shale exploration in Romania.

Oil and gas windfall taxes established in 2013 will expire at yearend. The reduction in revenue could lead policymakers to enact permanent taxes on oil and gas production the report said. The country is midway through a deficit-reduction program, which is considered as a possible motive for increased taxation.

Cargill added, “Corporate income tax in Romania is significantly lower than in many countries.” From an investment standpoint, increased taxes on profit is preferred over an increase in royalties. “These changes will lessen the attractiveness of Romania’s upstream fiscal regime in the medium term, the negative impact on the sector’s investment climate is expected to be limited,” Cargill said.

Contact Tayvis Dunnahoe at tavisd@ogjonline.com.

Related Articles

Antin Infrastructure Partners buys BP’s interest in CATS

04/24/2015 Antin Infrastructure Partners SAS, Paris, has agreed to acquire BP PLC’s Central Area Transmission System (CATS) business in the UK North Sea for $...

MARKET WATCH: NYMEX, Brent crude oil prices reach 2015 highs on Yemen strife

04/24/2015 Crude oil futures found support on both New York and London markets in Apr. 23 trading on news of more airstrikes against rebels in Yemen by Saudi ...

MOL agrees to buy Ithaca Petroleum Norge

04/24/2015 MOL Group has committed to drill three exploration wells offshore Norway during 2015-16 under an agreement to buy Ithaca Petroleum Norge from Ithac...

Congressional Republicans see undue restrictions in 2017-22 OCS draft

04/23/2015 Congressional Republicans—led by Senate Energy and Natural Resources Committee Chair Lisa Murkowski (Alas.) and House Natural Resources Committee C...

CERAWeek: Evolutions of Pemex, YPF running parallel

04/23/2015 Chief executives of Mexico’s Petroleos Mexicanos (Pemex) and Argentina’s YPF SA are both seeing energy reforms within their respective countries, a...

Diligence essential to avoid future offshore mistakes, panel told

04/23/2015 The offshore oil and gas industry—as well as the federal agencies that regulate it—must remain diligent to avoid the mistakes that led up to the Ma...

Gazprom: EC’s antitrust allegations ‘unsubstantiated’

04/23/2015 OAO Gazprom says antitrust allegations by the European Commission regarding territorial restrictions and an unfair pricing policy are “unsubstantia...

Upper East Coast US Senate, House members oppose Atlantic leasing

04/23/2015 Observing both Earth Day and the fifth anniversary of the Macondo deepwater well accident and crude oil spill, US Senate and House members—largely ...

Petrobras reports $2.1 billion write-down after anticorruption probe

04/23/2015 Petroleo Brasileiro SA (Petrobras) reported a $2.1-billion write-down from improper payments identified in the Brazilian Federal Police’s “Operatio...
White Papers

Pipeline Integrity: Best Practices to Prevent, Detect, and Mitigate Commodity Releases

Commodity releases can have catastrophic consequences, so ensuring pipeline integrity is crucial for p...
Sponsored by

AVEVA’s Digital Asset Approach - Defining a new era of collaboration in capital projects and asset operations

There is constant, intensive change in the capital projects and asset life cycle management. New chall...
Sponsored by

Transforming the Oil and Gas Industry with EPPM

With budgets in the billions, timelines spanning years, and life cycles extending over decades, oil an...
Sponsored by

Asset Decommissioning in Oil & Gas: Transforming Business

Asset intensive organizations like Oil and Gas have their own industry specific challenges when it com...
Sponsored by

Squeezing the Green: How to Cut Petroleum Downstream Costs and Optimize Processing Efficiencies with Enterprise Project Portfolio Management Solutions

As the downstream petroleum industry grapples with change in every sector and at every level, includin...
Sponsored by

7 Steps to Improve Oil & Gas Asset Decommissioning

Global competition and volatile markets are creating a challenging business climate for project based ...
Sponsored by

The impact of aging infrastructure in process manufacturing industries

Process manufacturing companies in the oil and gas, utilities, chemicals and natural resource industri...
Sponsored by

What is System Level Thermo-Fluid Analysis?

This paper will explain some of the fundamentals of System Level Thermo-Fluid Analysis and demonstrate...
Available Webcasts


Prevention, Detection and Mitigation of pipeline leaks in the modern world

When Thu, Apr 30, 2015

Preventing, detecting and mitigating leaks or commodity releases from pipelines are a top priority for all pipeline companies. This presentation will look at various aspects related to preventing, detecting and mitigating pipeline commodity releases from a generic and conceptual point of view, while at the same time look at the variety of offerings available from Schneider Electric to meet some of the requirements associated with pipeline integrity management. 

register:WEBCAST



On Demand

Global LNG: Adjusting to New Realities

Fri, Mar 20, 2015

Oil & Gas Journal’s March 20, 2015, webcast will look at how global LNG trade will be affected over the next 12-24 months by falling crude oil prices and changing patterns and pressures of demand. Will US LNG production play a role in balancing markets? Or will it add to a growing global oversupply of LNG for markets remote from easier natural gas supply? Will new buyers with marginal credit, smaller requirements, or great need for flexibility begin to look attractive to suppliers? How will high-cost, mega-projects in Australia respond to new construction cost trends?

register:WEBCAST


US Midstream at a Crossroads

Fri, Mar 6, 2015

Oil & Gas Journal’s Mar. 6, 2015, webcast will focus on US midstream companies at an inflection point in their development in response to more than 6 years shale oil and gas production growth. Major infrastructure—gas plants, gathering systems, and takeaway pipelines—have been built. Major fractionation hubs have expanded. Given the radically changed pricing environment since mid-2014, where do processors go from here? What is the fate of large projects caught in mid-development? How to producers and processors cooperate to ensure a sustainable and profitable future? This event will serve to set the discussion table for the annual GPA Convention in San Antonio, Apr. 13-16, 2015.

This event is sponsored by Leidos Engineering.

register:WEBCAST


The Future of US Refining

Fri, Feb 6, 2015

Oil & Gas Journal’s Feb. 6, 2015, webcast will focus on the future of US refining as various forces this year conspire to pull the industry in different directions. Lower oil prices generally reduce feedstock costs, but they have also lowered refiners’ returns, as 2015 begins with refined products priced at lows not seen in years. If lower per-barrel crude prices dampen production of lighter crudes among shale plays, what will happen to refiners’ plans to export more barrels of lighter crudes? And as always, refiners will be affected by government regulations, particularly those that suppress demand, increase costs, or limit access to markets or supply.

register:WEBCAST


Emerson Micro Motion Videos

Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected