December 8 (SeeNews) - Romania's top oil and gas group OMV Petrom [BSE:SNP] and U.S.-based Hunt Oil have started experimental gas production from the Padina North field, located in Buzau county, in southern Romania, OMV said on Thursday.
'With an average gross gas and condensate production stabilized at approx. 1,900 barrel of oil equivalent (boe) per day, in line with initial estimations, Padina North 1 well currently ranks among top wells in OMV Petrom’s portfolio," the company said in a press release.
The production comes from Padina North 1 well, drilled in 2014, along with other newly built production facilities: gas separators, gas treatment and gas measurement systems, pipelines ensuring connectivity to the national transport system and liquid products storage facilities, OMV added.
The total investments made by the two partners between 2014-2016 for the Padina North 1 project amount to some 17 million euro ($18.2 milllion).
“The start of production at Padina field shows our commitment to continue investments for projects which prove viable, despite the unfavorable context due to the low crude and gas prices. With a portfolio consisting mostly of mature fields, Romania needs investments in order to continue oil and gas production,” said Peter Zeilinger, member of OMV Petrom executive board responsible for upstream operations.
Experimental production is the final stage of a new reservoir exploration process. At Padina, experimental production is expected to span for approximately 12 months. The purpose of the experimental production is to collect data that will define the technical and economical details for the decision to pursue with field development.
OMV Petrom's consolidated earnings before interest and taxes (EBIT) fell by 14% on the year to 1.13 billion lei ($278 million/251 million euro) in the first nine months, affected by the oil price drop. OMV Petrom also said that it plans 30% lower investments for this year.
In mid-October, Romanian investment fund Fondul Proprietatea [BSE: FP] sold a 6.4% stake in OMV Petrom [BSE:SNP] for 682 million lei in four separate transactions. Before the sale Fondul Proprietatea owned 19% of OMV Petrom.
Blue-chip OMV Petrom shares traded unchanged at 0.2350 lei at 1145 CET on Thursday on the Bucharest Stock Exchange.
OMV Petrom is the largest integrated oil and gas group in Southeastern Europe, with an annual oil and gas production of approximately 65 million boe in 2015. The group has a refining capacity of 4.5 million tonnes per year and operates an 860 MW high efficiency power plant and a 45 MW wind park. The group is present on the oil products retail markets in Romania and neighboring countries through 786 filling stations, as at 30 September 2016.
In 2010, OMV Petrom signed a partnership with Hunt Oil for the exploration and development of onshore blocks Adjud and Urziceni East, each partner having a 50% interest, with Hunt Oil being the operator.
Hunt Oil Company is one of the largest privately held companies in the United States, operating both domestically and internationally. The company is actively engaged in exploration and production activities in North America, South America, Europe and the Middle East. The company has drilled wells on every continent except Antarctica.
(1 euro=4.5007 lei)