New royalties for the oil and gas sector in Romania will go under debate at the beginning of next year. The new royalties system should ensure budget revenues close to the European average for the sector, but will not discourage investments, Prime Minister Victor Ponta has said.

The project is currently being discussed with the World Bank and the International Monetary Fund and will be available for public debate at the beginning of next year.

The new royalties have been an important subject for debate in recent years, as oil and gas group OMV Petrom has benefited from a low-royalty scheme in the last 10 years. This was one of the clauses of the privatization contract signed by the Romanian state with Austrian group OMV in 2004. This facility will expire at the end of this year.

Analysts anticipate that the royalties will be increased, but OMV Petrom representatives have warned that if taxation becomes too high than they might cut investments.

Ponta was in the U.S. last week where he met representatives of oil and gas groups ExxonMobil and Halliburton to talk to them about investments in Romania’s oil and gas sector.

editor@romania-insider.com