High gas prices are not reflected in OMV Petrom’s results due to extremely high taxation – in 2021, the effective tax rate on gas production was of 47%, says Christina Verchere, CEO of OMV Petrom, in an interview for Agerpres.

“We had the largest contribution to the state budget, of about 12.3 billion lei. Our financial performance in 2021 was indeed better than in 2020, however below the level of 2019. The results were mainly due to the sharp rise in oil prices, higher demand for energy products and the excellent performance of the Petrobrazi refinery and of the Brazi power plant. The production of the Brazi power plant was the highest since 2012, the year when it was put into operation, and covered 8% of Romania’s energy production,” said Verchere.

The tax burden on natural gas is what discourages new investment. The tax regime is six times higher than the European Union average, and for offshore gas, ten times higher, she said.

“Our daily hydrocarbon production fell 7.6% from last year, excluding asset sales, which declined sharply in natural gas than in crude oil. Despite repair work and newly drilled wells, we have experienced a sharp natural decline in our main natural gas fields – Totea, Lebăda Est offshore and Burcioaia.

“This development demonstrates the urgent need to unlock additional resources. In a market environment with volatile prices, the current fiscal framework of natural gas puts pressure on investments in gas projects in Romania, thus threatening the domestic supply.”