Partnership Petrom – Petrofac to increase production
- Partnership targets cumulative production enhancement out of nine onshore fields in Ticleni area by at least 50%, in the next five years
- Petrom to remain the title holder of concessions contracts and hydrocarbons production; Petrofac will manage the activity in the fields on behalf of Petrom
Petrom, the largest oil and gas producer in Southeastern Europe, signed a 15 year production enhancement contract for several fields in the area of Ticleni with Petrofac, a leading international provider of facilities solutions to the oil and gas production and processing industry. According to this partnership, Petrofac will perform services in the respective fields in order to maximize production while improving operational efficiency. In this view, Petrofac will provide the necessary expertise and technologies as well as the financial and human resources. Petrom will supervise the operations and will remunerate Petrofac per barrel of oil produced, including an enhanced tariff for incremental production. The contract is effective immediately.
Mariana Gheorghe, CEO of Petrom: "In order to unlock our E&P potential, given the complexity of operating mature fields as well as the complexity of our portfolio in Romania, we will focus our efforts on the re-development of six to eight major fields until 2015. In parallel, in order to maximize production on other mature fields, we decided to enter partnerships with internationally reputed companies, with a track record of remarkable results in this area. The partnership with Petrofac, a leading international company in providing solutions for oil and gas production industry is an example in this regard. Through this partnership we are confident in obtaining the best results, considering the risks sharing, cost reduction and production increase."
The scope of the contract consists of redevelopment services of oil reservoirs situated within nine onshore fields, in Ticleni area, Southwest Romania. These are mature fields which have been exploited for the last 60 years. Presently, the nine fields produce together approximately 4,500 boe/day, representing around 2.5% of Petrom’s total domestic production.
Johann Pleininger, member of Petrom Executive Board, responsible for Exploration and Production: "Most of our fields are mature; the reservoirs’ diversity is very large and need high investments as well as a customized approach for each reservoir, state-of-the-art technologies and international expertise. The partnership with Petrofac will enhance the efficient exploitation of our fields".
During the first five years, Petrofac will provide a cumulative production increase by at least 50% in the concerned fields compared to the current production decline.
Production operations and related services, as well as the employees involved in these activities are transferred to Petrofac for the duration of the contract.
Petrom will remain the title holder of the concessions contracts, the hydrocarbons production, the existing assets as well as of the rights and obligations as defined by the Petroleum Law.
Commenting on the award, Ayman Asfari, group chief executive of Petrofac, said: "I am delighted to announce this contract which is a significant milestone for Petrofac Production Solutions as we have been assessing opportunities like this for some time. We believe this innovative approach enables us to align with our customer while generating additional value by investing and leveraging our operations, drilling management, production engineering, facilities upgrade and training skills. This contract also provides us with the opportunity to develop a track record for excellence in the production enhancement market which has the potential to be an area of significant growth over the medium-term."
OMV Petrom SA
Petrom is the largest Romanian oil and gas group, with activities in the business segments of Exploration and Production, Refining and Marketing as well as Gas and Power. Petrom exploits estimated proved oil and gas reserves of 823 mn boe in Romania (854 mn boe at group level), has an annual refining capacity of 8 mn t and holds around 550 filling stations in Romania. The company also has an international network of 268 filling stations located in Moldova, Bulgaria and Serbia. In 2009 the turnover of Petrom was EUR 3,029 mn, EBITDA was EUR 696 mn. OMV Aktiengesellschaft, the leading energy group in Central and Southeastern Europe holds a 51.01% share in Petrom. OMV is active in 12 Central European countries in its Refining and Marketing business segment and in 17 countries on four continents in Exploration and Production. Ministry of Economy holds 20.64% of Petrom shares, Property Fund SA holds 20.11%, the European Bank for Reconstruction and Development 2.03% and 6.21% is free float on Bucharest Stock Exchange.
Petrofac is a leading international provider of facilities solutions to the oil & gas production and processing industry, with a diverse customer portfolio including many of the world’s leading integrated, independent and national oil & gas companies. Petrofac is quoted on the London Stock Exchange (symbol: PFC) and is a constituent of the FTSE 100 Index.
The group delivers services through seven business units: Engineering & Construction, Engineering & Construction Ventures, Engineering Services, Offshore Engineering & Operations, Training Services, Production Solutions and Energy Developments.
Through these businesses Petrofac designs and builds oil & gas facilities; operates, maintains and manages facilities and trains personnel; enhances production; and, where it can leverage its service capability, develops and co-invests in upstream and infrastructure projects. Petrofac’s range of services meets its customers’ needs across the full life cycle of oil & gas assets.
With around 12,000 employees, Petrofac operates out of six strategically located operational centres, in Aberdeen, Sharjah, Woking, Chennai, Mumbai and Abu Dhabi and a further 19 offices worldwide. The predominant focus of Petrofac’s business is on the UK Continental Shelf (UKCS), the Middle East and Africa, the Commonwealth of Independent States (CIS) and the Asia Pacific region.
Petrofac’s Productions Solutions business unit offers customers single-point access to a wide range of services to help them improve production, profitability, operational efficiency, asset integrity and the recovery of marginal reserves. In addition to the service operator contract with Dubai Petroleum, the business unit comprises four specialist service providers: Eclipse, Caltec, SPD and Plant Asset Management. Productions Solutions is part of Petrofac’s Engineering, Training Services and Production Solutions reporting segment.
For additional information, please refer to the Petrofac website at www.petrofac.com.