Romania’s Petrom to double planned investment

Food

Romania’s top energy firm Petrom, majority owned by Austria’s OMV, plans to more than double investments until 2010 to meet expansion and modernization goals, the company said on Tuesday.

The investment plans included reducing production costs, increasing sales and improving the efficiency of its refining arm. “To reach the strategic objectives for 2010, the company estimates annual investment of €1.5 billion ... due to acquisitions, new projects, industry costs inflation, and the condition of equipment,” Petrom said. A five-year strategy, drafted in 2005, envisaged spending plans of €3 billion ($4.68 billion), but by 2007 Petrom had already spent €2.2 billion. It now plans to spend about €1.5 billion annually until 2010. “The overall investment costs will be more than double previous plans,” Ramona Zanfirescu, a Petrom spokeswoman, told Reuters.

The company said record high global energy costs had a mixed impact on its bottom line, but gave no details. Petrom wants to reach an output in Romania of 210,000 barrels oil equivalent (boe) per day, compared with 89,000 boe last year and plans to reduce output costs to $15 per boe, compared to $17.8 per boe in the Q1 of this year. It plans to reach a daily output from the Caspian region to 20,000 boe per day by 2010, compared with around 5,000 boe per day currently.

It also plans to expand the capacity of its Petrobrazi refinery in Romania to 6 million tons a year from 4.5 million tons currently. Petrom expects to complete the modernization of its refining facilities in 2011. Another goal is to increase volumes of gas and energy sold to 7 billion cubic meters per year from 5.2 billion last year. Petrom also plans to develop its own storage facilities. The company wants to build a power plant in the southern town of Brazi by September 2011, estimated to reach an output of over 860MW and cost around €400 million. (Reuters)

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