ROPEPCA: THE REFERENCE TO THE AUSTRIAN HUB IS IRRELEVANT TO THE ROMANIAN NATURAL GAS MARKET


11.02.2018
The Romanian Association of Petroleum Exploration and Production Companies – ROPEPCA welcomes the ANRM’s initiative to launch in public consultation the “Draft on the methodology for setting the reference price for natural gas extracted in Romania”. In a position sent to energynomics.roDaniel Apostol, Secretary General of ROPEPCA, stresses that it is very important for the final consumer that the gas reference price be established based on a relevant market calculation for Romania, a calculation that would reflects the price actually achieved on the Romanian market.

“Linking the reference price to the Austrian hub for natural gas is irrelevant to Romanian natural gas producers which do not have an effective connection to this hub, and taking the Baumgarten price as the reference price for determining the royalty for domestic gas production can had an inflationary impact upon the Romanian consumer”, warns the ROPEPCA representative. “Let’s remind that the governance program provides for the stability of prices, stability and energy security for consumers in Romania. The price at the Austrian hub is not reflected correctly at the net price of the Romanian producers. For reaching the hub, natural gas crosses a series of natural transactions that lead to final prices including the margins of each intermediary; it is not right for Romania to pay a reference price irrelevant to the domestic market but which, through the margins mentioned, can bring risk of price increase for the final consumer. There is a risk of inconsistency even with the promises of the governance program. The worst choice for the domestic producer is the reference to an external market with which the domestic producer has no connection to and they do not sell natural gas.”

Daniel Apostol also states that, for years, domestic producers have been paying royalties at the highest between the [ANRM’s] reference price and the market price actually obtained as a result of the natural gas trading in Romania. “For years, ANAF has acknowledged the correctness of the price, which is the basis of the revenues made by the domestic producers, and which leads to the imposition of all taxes and duties owed by producers to the Romanian state. Since ANAF recognizes this price as a benchmark for taxing and charging, why does not this price remain as equitable as for ANRM to set the reference in the basis of calculating royalties? It is not possible for two bodies of the same state to set two different references for the same domestic producer.”

In the message sent to energynomics.ro, Daniel Apostol conveyed the idea that the state-producer- final consumer relationship must have the form of an equilateral triangle. “The state must build its public policies and taxation in such a way as to meet the need to protect the citizen as a consumer, to meet the public budget’s need for satisfactory state revenues, and to satisfy the need of the producers operating in Romania to be encouraged to continue operating in this market, to invest, to create jobs, to earn income and profit, and thus to be able to feed the public budget with taxes.”

ANRM: Romanian gas market is immature, royalties must take into account the Austrian hub

The position taken by ROPEPCA comes in the context in which the National Agency for Mineral Resources (ANRM) launched in public debate a draft order for the modification of the methodology for establishing the reference price for natural gas according to which the royalties due to the budget by the producers will be calculated by taking into account the price of gas at the Austrian hub in Baumgarten. In a first public debate organized by ANRM on Wednesday, February 7, Dorinel Unsărescu, counselor of the ANRM President, invoking two audits by the Court of Accounts, said that the state budget lost revenues of over 7 billion lei during 2010-2015, as the reference gas price for calculating oil royalties has not been updated since 2008.

 

/ ENERGYNOMICS.RO

11.02.2018 · ROMANIA