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

State approves Shell’s plan for US Appalachian ethylene plant

06/23/2015 Pennsylvania’s Department of Environmental Protection (DEP) has approved a permit allowing Royal Dutch Shell PLC subsidiary Shell Chemical LP to pr...

API relaunches ‘Vote4Energy’ program leading up to 2016 elections

06/23/2015 The American Petroleum Institute wants US voters to elect candidates in the 2016 elections who support broader development of the nation’s abundant...

Newly formed Quadrant Energy to decommission East Spar buoy

06/23/2015 One of the first intentions of newly formed Quadrant Energy Pty. Ltd., Perth, is to remove the East Spar field navigation, communication, and contr...

MARKET WATCH: Brent gains modestly on strengthening European economic indicators

06/23/2015 US crude oil futures for July delivery gained 7¢ on the New York market in June 22 trading as that month’s contract expired, and Brent crude oil fo...

US Forest Service withdraws proposed groundwater directive

06/22/2015 The US Forest Service withdrew a proposed directive on groundwater resource management on June 19, and announced it would hold public discussions o...

Williams rejects unsolicited bid from Energy Transfer Equity

06/22/2015 Williams Cos. Inc., Tulsa, has rejected an unsolicited all-equity acquisition proposal valued at $53.1 billion from Dallas-based Energy Transfer Eq...

WPX Energy adds to acreage in Gallup oil play

06/22/2015 WPX Energy Inc., Tulsa, has added to its San Juan Gallup acreage in New Mexico with the purchase of another 14,300 net acres from an undisclosed se...

YPFB Andina makes oil discovery in Bolivia’s Boqueron field

06/22/2015 YPFB Andina reported an oil discovery in Boqueron field in Bolivia’s Santa Cruz region. The Boqueron 4D well reached a total depth of 3,237 m and h...

Lundin appoints president, chief executive officer

06/22/2015 Lundin Petroleum AB reported that its board has appointed Alex Schneiter as president and chief executive officer following Ashley Heppenstall’s de...
White Papers

Three Tips to Improve Safety in the Oil Field

Working oil fields will always be tough work with inherent risks. There’s no getting around that. Ther...
Sponsored by

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
Available Webcasts


OGJ's Midyear Forecast 2015

When Fri, Jul 10, 2015

This webcast is to be presented by OGJ Editor Bob Tippee and Senior Economic Editor Conglin Xu.  They will summarize the Midyear Forecast projections in key categories, note important changes from January’s forecasts, and examine reasons for the adjustments.

register:WEBCAST


Predictive Analytics in your digital oilfield - Optimize Production Yield and Reduce Operational Costs

When Tue, Jul 7, 2015

Putting predictive analytics to work in your oilfield can help you anticipate failures, plan and schedule work in advance, eliminate emergency work and catastrophic failures, and at the same time you can optimize working capital and improve resource utilization.  When you apply analytic capabilities to critical production assets it is possible to reduce non-productive time and increase your yield.

Learn how IBM's analytics capabilities can be applied to critical production assets with the goal of reducing non-productive time, increasing yield and reducing operations costs.

register:WEBCAST



On Demand

Cognitive Solutions for Upstream Oil and Gas

Fri, Jun 12, 2015

The oil & gas sector is under pressure on all sides. Reserves are limited and it’s becoming increasingly expensive to find and extract new resources. Margins are already being squeezed in an industry where one wrong decision can cost millions. Analyzing data used in energy exploration can save millions of dollars as we develop ways to predict where and how to extract the world’s massive energy reserves.

This session with IBM Subject Matter Experts will discuss how IBM Cognitive Solutions contribute to the oil and gas industry using predictive analytics and cognitive computing, as well as real time streaming for exploration and drilling.

register:WEBCAST


The Alternative Fuel Movement: Four Need-to-Know Excise Tax Complexities

Thu, Jun 4, 2015

Discussion on how to approach, and ultimately embrace, the alternative fuel market by pulling back the veil on excise tax complexities. Taxes may be an aggravating part of daily operations, but their accuracy is crucial in your path towards business success.

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