The management of Romgaz, which beside OMV Petrom, announced last week the investment decision in the most important offshore project in Romania's territorial waters (Neptun Deep), asked shareholders' permit to lend USD 454 million to the subsidiary Romgaz Black Sea Limited (RBSL) that handles the project.

This is the first of the loans that the Romanian state-controlled company will grant to its subsidiary for the development of the deposit.

Romgaz's investment in the project is estimated at EUR 2 billion by 2027 when production is expected to begin.

The first loan covers the financing of the operations for just one year, from July 2023 to March 2024, Profit.ro reported.

To finance the offshore project, Romgaz intends to raise EUR 1 billion from foreign markets with a bond issue, carried out in two stages.

The two bond issues will be made at an equal value of EUR 500 million each, listed both on the Luxembourg Stock Exchange and the local Stock Exchange (BVB). The first issuance will take place next year.

The bonds will be denominated in euros rather than dollars, given the lower funding cost and the option of a more favourable syndicated refinancing afterwards.

iulian@romania-insider.com

(Photo source: Inquam Photos/Adel Al-Haddad)