Gas is now flowing into Romania from a new platform in the Black Sea, which operates in waters where mines and warships have been sighted.
Dangerous memories of the war raging nearby in Ukraine underscore Romania’s determination to reduce its dependence on Russian natural gas imports.
With fears growing across the European Union that Moscow will cut gas supplies in retaliation for EU support for Ukraine, countries are scrambling to find alternative sources of supply.
“Romania is taking a crucial step to ensure its energy security … at a time when international gas supplies are threatened by the war in Ukraine,” Prime Minister Nicolae Ciuca said on Tuesday as he opened a Black Sea Oil & Co. inaugurated. Gas (BSOG) in the southeastern village of Vadu.
While Romania has significant reserves on land and at sea, it still has to rely on Russia for around 20 percent of its consumption during the winter.
Backed by US private equity firm Carlyle Group LP and the European Bank for Reconstruction and Development, BSOG began developing subsea resources two weeks ago, becoming the first new offshore development in the Black Sea in the last 30 years.
The $400 million platform produces three million cubic meters of gas per day. It aims to extract one billion cubic meters per year for 10 years, or about 10 percent of Romania’s needs.
“Today we face an emergency in terms of energy supply. We need to put our old devils in the closet… and start producing locally,” said Thierry Bros, an energy and climate expert at Sciences Po University.
“We have to restart the projects in the Black Sea, restart the growth of production in Norway, in the UK we have to think about starting production of shale gas and in France of mine gas production,” he told AFP.
– mines and warships –
In Vadu, BSOG CEO Mark Beacom said he hopes the “state-of-the-art” infrastructure set up by his company will be used for future gas or renewable energy projects in the Black Sea.
But Russia’s invasion of neighboring Ukraine has complicated the situation.
“We’re not in a war zone, but we’re close enough and it’s clearly having an impact,” he said.
“We have detected mines near the platform, we have had warships approaching our platform and we have had aircraft circling our platform,” he added.
BSOG holds two concessions some 120 kilometers (65 nautical miles) off the Romanian coast, part of which was ironically regained by Bucharest from Ukraine in 2009 following a ruling by the International Court of Justice in The Hague.
While Romania is betting on offshore gas reserves of an estimated 200 billion cubic meters of gas, investors remain cautious.
The Austrian group OMV and its Romanian partner Romgaz have yet to decide whether to continue the Neptun Deep project to produce 42 to 84 billion cubic meters of gas.
– End of guaranteed energy? –
Bucharest hopes the two groups will start producing as early as 2026, which would allow Romania to “become fully independent in terms of gas” and export the surplus to its neighbors, Energy Minister Virgil Popescu said.
According to a 2018 study by accounting firm Deloitte, offshore gas could bring the Romanian government $26 billion in tax revenue over a projected 23-year operational period.
In May, after much hesitation, Parliament finally amended a law unfavorable to offshore investments, which had caused ExxonMobil in particular to withdraw from the Neptun Deep project at the end of 2021, after having invested around 2 billion US dollars there together with OMV.
“If we want to win against the Russians, we need energy,” Bros said, warning that the days of the “energy guarantee” within the EU could be over.
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