Petrom to develop massive Kazakhstan oil reserves
Romanian oil and gas company Petrom, part of the Austrian OMV Group, last month announced it has approved a 150 million Euro development plan for the Komsomolskoe oil field in Kazakhstan.
This increases ties between Romania and Kazakhstan, where thousands of Romanian work, mostly in the energy field. Romanian oil and gas firm Rompetrol Well Services (RWS) also has a branch office in Aktobe, Kazakhstan.
This sees Romania, with Austrian backing, as key in assisting the exploitation of Kazakhstan’s massive oil reserves.
The oil field development is planned to be finalised by 2008 and will result in a daily production rate of 10,000 boe (barrel of oil equivalent).
“The Caspian Sea Region is a core region for us in terms of international company growth,” said Werner Ladwein, member of the managing committee of Petrom and responsible of exploration and production.
“It is clearly a high potential area to be fully used and supported by investments, modern technologies that we are using and, especially by our field experience,” he added.
Enterprise Investors picks up Deva-based construction materials firm
Polish Enterprise Fund V, a private equity fund managed by Enterprise Investors (EI), has purchased construction material producer Macon Deva for 35 million Euro. EI officials said the construction field is one of the fastest growing businesses in the country, with a ten per cent growth in 2005 and an estimated growth of 20 percent in 2006.
“The upcoming EU accession will have a positive impact on the Romanian construction market, which we estimate will become the most dynamic in the EU,” said EI vice president Cristian Nacu.
Enterprise Investors is reportedly the largest private equity firm in central and eastern Europe, managing funds totalling 1.6 billion Euro.
The company last month announced it will invest between 100 and 150 million Euro on the Romanian market in the next three to four years through its sixth investment fund launched this year.
Four bidders scramble for two video telephony licenses
Romania’s auction for two licenses for video telephony (3G) services have attracted four bidders. Cosmote Romania, National Radiocommunications Company, RCS&RDS and Telemobil have submitted formal offers to the Romanian General Inspectorate for Communications and Information Technology (IGCTI) for the 28 million Euro acquisition. “In 2004, when we had the first 3G auction, only two companies bid, owing to the restrictive conditions that were then in place,” said IGCTI president, Catalin Marinescu. “Today the situation is different, and the fact that we have four bidders would lead to a quicker launch of 3G services and better development conditions for the 3G networks.”
The winners are expected to be announced by 15 October. Currently telecom operators Orange and Vodafone have launched 3G in Romania. Of the bidders, Cosmote and Telemobil, with the Zapp brand, offer mobile phone services in Romania.
Hi-tech industry boosts trade but deficit still wide
Italy and Germany top the ranking of Romania’s foreign trade partners, according to the Ministry of Foreign Trade last month.
The country also saw an increase in overall foreign trade for Romania by 22.5 per cent in the first seven months of 2006 compared to the same period one year ago.
However the trade deficit totalled 5.35 billion Euro during the same time-frame. “This year, products manufactured by medium and high technology industries accounted for more than 50 per cent of total efforts for the first time ever,” said Minister Delegate for Trade, Iuliu Winkler. “This is an index for the consolidation of the competitiveness for Romanian products’ on foreign markets and shows a better usage of our national resources.”
The value of Free on Board (FOB) export in the first seven months of this year reached 14.89 billion Euro, up 18.98 per cent over the same period in 2005, while FOB imports accounted for 20.36 billion Euro, more than the similar period in 2005 with 4.06 billion Euro.
Nations to which Romania exports (top 10) - by value
Italy: 18.6 per cent
Germany: 14.9 per cent
Turkey: 7.7 per cent
France: 7.6 per cent
Hungary: 4.9 per cent
UK: 4.6 per cent
Austria: 2.9 per cent
Bulgaria: 2.8 per cent
USA: 2.8 per cent
Spain: 2.5 per cent
Nations from which Romania imports (top 11) - by value
Italy: 15.5 per cent
Germany: 14.6 per cent
The Russian Federation: 8.9 per cent
France: 6.7 per cent
Turkey: 4.7 per cent
China: 3.9 per cent
Austria: 3.9 per cent
Kazakhstan: 3.5 per cent
Hungary: 3.1 per cent
Poland: 2.6 per cent
UK: 2.6 per cent
Rompetrol aims for 200 petrol stations in Ukraine
Local oil and gas firm, the Rompetrol Group, has announced it has opened its Ukrainian subsidiary, with an aim to operate about 200 petrol stations in two years’ time. For the moment the company sells its products through wholesale. In the past Rompetrol has exported fuels to Ukraine, produced by local oil refinery Rompetrol Rafinare Constanta and sold though private petrol stations. General manager of the new operation is Laurentiu Argeseanu, former head of operations at Rompetrol Downstream.
Spanish group looks to turn on to wind energy
Construction, energy and environment firm Detea Group intends to invest around 100 million Euro in three wind energy projects in Romania, but no decision has yet been takes as to where the 20 or so wind mills could be located, director of the firm Alfonso Otero told The Diplomat. “We need at least one year of measurements to take decisions, and then the manufacturers need another year to construct the wind mills,” he adds. Experts believe the Dobrogea area, close to the Black Sea, is the most likely district for potential wind energy.
Ministry to set up biofuels working group
Minister of Economy and Trade last month has met with representatives of oil and gas companies, including Petrom, Rompetrol and Lukoil, who have shown interest in investing in refining capacities to produce biofuels. Minister Ioan Codrut Seres and the companies agreed to establish a working group to meet the producers’ demands for support for biofuels, which use plants such as sunflowers to create fuel. Under EU legislation, in 2007 Romania has to report a two per cent biofuels consumption rate.
Railway flyover due for Pipera
Bucharest Sector 2 City Hall will begin construction of a new flyover over the railway crossing the Pipera-Tunari road, a project valued at about 7.5 million Euro, said Mayor of Sector 2, Nicolae Ontanu. An auction is due in the coming months to select the construction companies, said the Mayor.
Romania: best business reformer after Georgia
Romania is the second most active business reformer after Georgia, according to a new study of 175 countries by the World Bank. This is due to free market reforms such as easing access to credit, increasing labour market flexibility and strengthening the protection of investments. In terms of ease of doing business, in eastern Europe, Romania ranks fifth, behind Lithuania, Estonia, Latvia and Slovakia.
City Hall wants to buy banking palace
Bucharest City Hall wants to buy the building that lodges Romania’s Savings Bank (CEC) from the Government for a reported 18 million Euro. The turn-of-the-20th century building, designed by French architect Paul Gottereau on Calea Victoriei, is considered as a ‘property of the city’ and should stay under municipality control, city officials said. The City General Council is asking the Government to allow almost 18 million Euro to re-buy the building. The payment will probably come from the Ministry of Public Finance, after a Government decision, and will be paid to the current owners of CEC, the Ministry of Finance.
EBRD to lend 250 million Euro to local food and beverage player
European Bank for Reconstruction and Development (EBRD) has approved a syndicated loan worth 250 million Euro for Romanian fmcg firm European Drinks to strengthen the group’s operations and support its long term investment and expansion programme. The investments will tackle new production capacities, logistics operations and the distribution network.
Remco goes to Bulgaria
Dutch-based Remco Romania last month won a contract to develop the first investment phase of French car component manufacturer Montupet in Ruse, Bulgaria, according to Ziarul Financiar. The contract is worth more than five million Euro and comprises the building of the first hall, stretching over 20,000 sqm.
Daimler-Chrysler buys up local Mercedes car importer
German-American Daimler-Chrysler will buy 51 per cent of the car importer for Mercedes, Smart, Chrysler, Jeep, Dodge and Fuso. The takeover of Autorom, part of Tiriac Auto, will create a joint venture - Daimler-Chrysler Automotive Romania. The new importer will also take on the 130 emplo-yees of Autorom and will begin its activity of import, sales and marketing on 1 January 2007.
Sibiu airport modernisation goes ahead
Sibiu County Council has approved a contract worth 59 million Euro to modernise the city airport. A consortium comprising Dafora Media, Con-A Sibiu and Lindner Germany has won the auction to modernise several buildings and the airport infrastructure, including the passenger terminal, the control tower and the fuel warehouse.
UK lobbying firm Burson Marsteller steps in before EU opens up
UK lobbying firm and part of marketing giant WPP, Burson Marsteller, has entered the Romanian market through a partnership with CEC Government Relations. “In today’s Europe, it is more and more necessary to lobby in the capitals of the EU 25 - and soon to be 27 - to secure the qualified majority or blocking minority that may be needed to influence a piece of European Union legislation or policy,” said Jeremy Galbraith, CEO of Burson-Marsteller Brussels and chairman of European Public Affairs.
Local distributor pumps cash into Bucharest logistics centre
Whiteland, the distributor for fmcg brands Hochland, Meggle and Campina, and producer of Don Gustosso condiments will invest four million Euro in a logistics centre on the outskirts of Bucharest. The company will invest a further 800,000 Euro to improve the production capacity for Don Gustosso brand in Medias, Sibiu county. Whiteland last year posted a 50 million Euro turnover and expects a 20 per cent increase this year.
Vodafone breaks contract with Germanos
Mobile phone operator Vodafone Romania last month announced it will end its distribution contract with retailer Germanos on 15 October. The move was determined by Germanos’ inability to meet the requirements to represent the Vodafone brand. This follows the retailer’s buy-out by Greek-based Cosmote, one of Vodafone’s competitors on the Romanian market.
Spanish engineering firm renews Cluj-Napoca road
Civil engineering company FCC is renewing 30 kilometres of the road between Cluj-Napoca and Livada, under a contract worth 25.3 million Euro. The project will be to modernise the road, expand it to nine metres wide in urban areas and from seven to 12 metres wide on interurban sections, while making minor improvements in the route, expanding structures and strengthening the surface. The project will use 175,000 tonnes of asphalt mix.
Mineral water producer shifts to coffee and juices
Mineral water producer Romaqua Group has taken out a loan of 8.2 million Euro from Banca Comerciala Romana (BCR) to finance expansion of its production facilities in Bucharest and Busteni, Prahova county, to produce coffee and soft drinks. Officials said the funds will be used to build some production and storage halls, as well as buying lines for producing plastic bottles (PET) and refrigeration rooms.