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    Romanian Offshore Project to Deliver, Subject to FID

Summary

The offshore law still needs to be assessed and deemed manageable.

by: William Powell

Posted in:

Natural Gas News, Europe, Corporate, Exploration & Production, Balkans/SEE Focus, TSO, News By Country, Romania

Romanian Offshore Project to Deliver, Subject to FID

Black Sea Oil & Gas (BSOG) and Romanian transmission system operator Trasngas signed November 9 the contract for the transport of the Midia Gas Development Project into the gas grid.

The contract, which is subject to upstream final investment decision (FID), is the outcome of the successful efforts undertaken under a co-operation agreement signed in 2016 and an open season capacity booking process which began in July 2017. The contractual period covers 15 years with a first gas delivery date on February 1, 2021 at a transmission capacity of 1bn m³/year, BSOG said. It is owned mostly by Carlyle, while the European Bank for Reconstruction and Development has a minor but unpublished stake.

The FID itself will depend on the partners' view taking a positive view on the unwelcome and unexpected offshore law this year, which led other companies to postpone FIDs that had been expected late this year. 

The MGD Project consists of five production wells (1 subsea well at Doina field and 4 platform wells at Ana field) a subsea gas production system over the Doina well which will be connected through an 18-km pipeline with a new unmanned production platform located over Ana field. A 126-km gas pipeline will link the Ana platform to the shore. The processed gas will be delivered into the NTS at the gas metering station.

BSOG CEO Mark Beacom said the company was "very pleased to have reached this important milestone in this pioneering offshore project that we have been working on alongside our partner Transgaz over the past three years." He thanked Transgaz for its professional approach to "overcome a number of regulatory and technical challenges and reaching this stage."

Beacom said that while the "assessment of the impact of the offshore law on our business is still underway, we continue to move ahead to close out all the remaining milestones, necessary for our shareholder and partners to reach a decision. These milestones include completing all the regulatory requirements, the signing of a gas sales agreement with a gas buyer, having in place all the long lead and major equipment purchase orders" and other engineering and construction contracts.  

His counterpart at Transgaz Ion Sterian said: "Given the natural gas deposits discovered in the Black Sea in the last period, Transgaz intends to expand the National Transmission System in order to set up an additional entry point for the natural gas coming from the Black Sea offshore blocks. The project consists of building a new 20-inch (Dn 500) gas pipeline designed to carry natural gas at a pressure of 55 bar, with a total length of approximately 24.37 km that will connect the Black Sea coast with Transit 1 transport pipeline on the route Black Sea coast - Corbu - Sacele - Cogealac - Gradina. The project will contribute to the sustainable development of the area, and all natural gas coming from this block will enter the National Transmission System."