Investments in the Black Sea oil sector to bring USD 26 bn to the state budget

Investments in the Black Sea oil sector will generate revenues to the state budget of USD 26 billion and an additional USD 40 billion to Romania’s GDP by 2040, according to a study conducted by Deloitte, at the request of Romanian Black Sea Titleholders Association (ARCOMN).

The largest amount, USD 9.5 billion, will be corporate income tax. USD 3.7 billion will come from VAT and excise duties, USD 6.5 billion – from the social insurance contributions and USD 5.5 billion from the royalties.

Over the same period, these investments will support over 30,000 jobs per year.

Analysts estimate that the offshore gas output will reach 170 billion cubic meters, of which 35 percent will be exported.

According to Razvan Nicolescu, Executive Lead Advisor Deloitte Romania, there are premises that 65 percent of this gas will be consumed in Romania.

Oil companies will invest USD 15.7 billion in projects in the Black Sea during 2018 – 2040, according to the report.

In 2016, 8.7 bcm of gas were brought to surface locally and a remaining quantity of 1.3 bcm was imported to cover the national consumption. Under the Romanian soil are proved reserves of approximately 105.5 bcm8 of regular gas reserves (excluding reserves obtainable through fracking), only 10.5 times more than the consumption in 2016.

The Romanian Black Sea Titleholders Association (ARCOMN) is the only association dedicated to the exploration and development of Romania’s Black Sea hydrocarbons resources.