ABOVE THE AMOUNT BUDGETED IN THE REVISION CAUSED BY THE PANDEMIC9-month profit of Romgaz exceeds 950 million lei"

English Section / 06 noiembrie 2020

(Interview with Adrian Volintiru, CEO of SNGN Romgaz)

The 9-month profit of the National Natural Gas Company exceeds 950 million lei, thus higher than the amount budgeted in the rectification after the pandemic was declared, Adrian Volintiru, the general manager of Romgaz, told us in an interview.

The revised budget of the state-owned company published during the pandemic forecasts a net profit of about one billion lei for the entire year 2020.

Mr. Volintiru told us: "It seems that Romgaz's results at nine months are very good compared to the market median and compared to competitors, which makes us happy and makes us look with hope towards next year as well. In the meantime, output has almost reached the maximum, more than 14 million cubic meters are being extracted per day, which is extraordinary for us, much more than what we had predicted in the rectified budget. With output at this level, finishing all revisions and taking into account at the market price, I expect spectacular results at the end of the year ".

Adrian Volintiru also pointed out, among other things, that, as output production is approaching the maximum capacity and the warehouses are almost full, this winter there will be enough heat for everybody.

Reporter: It has been eight months since the pandemic was being declared in Romania. How has the activity of Romgaz evolved during this time and what measures have you taken so that the company you are in charge is affected by the sanitary crisis as little as possible?

Adrian Volintiru: We have been very careful all this time, and the protection programs against Covid-19 have worked very well at the company level, with the involvement of the executive in charge and the union leader. People have been very accommodating and protected themselves as best they could, including by using the established routes and following all the other necessary measures.

From another point of view, we cut the non-essential expenditures that were provided for in the budget, precisely to try to ensure a high profitability. And we seem to be doing very well financially at the moment.

Reporter: What were the Romgaz financial results like at the end of the first nine months?

Adrian Volintiru: After nine months we have a profit of over 950 million lei, meaning above the amount set through the budget revision which was drafted after the pandemic was declared. We will find out more when the final numbers are ready and when they are published on the BSE as well.

Reporter: What are the results of Romgaz like after nine months, compared to those of its main competitors?

Adrian Volintiru: It would seem that they are very good compared to the market median and its competitors, which makes us happy and makes us look towards next year with hope. Meanwhile, gas output has also reached the maximum, over 14 cubic meters per day are being extracted, which is remarkable for us, way above the revised budget.

Reporter: Based on the preliminary results it follows that energy production has increased this year. What are the causes behind this?

Adrian Volintiru: First of all, we took care of the maintenance work on group 5 which is currently operating at Iernut and, obviously, consumption has also increased, as a consequence, including gas consumption, because Iernut, at the moment, consumes about 46,000 cubic meters per day, which helps us with the overall result.

Reporter: What is the new deadline for the completion of the Iernut plant?

Adrian Volintiru: The last deadline we have, and the only one, is December 26, 2020, which is when the investment must be completed by. It is a turnkey project and, therefore, the consortium made up of Duro Felguera and Romelectro is responsible for that deadline. We are doing everything in our power to complete this year everything that is up to us. The rest is the responsibility of the two companies.

Reporter: What are your estimates for the end of this year, when it comes to the financial results of Romgaz?

Adrian Volintiru: By taking the output to its maximum, finishing all the maintenance works and taking the market price into account, I expect spectacular results at the end of the year.

The effort of the Romgaz sales team yielded fabulous results, from my point of view, because we have extraordinarily good financial results, for example, with a much lower output than Petrom.

Reporter: Economy Minister Virgil Popescu recently announced that the state wants to take over, through Romgaz, the 50% stake in the Neptun Deep gas field, owned by ExxonMobil. What stage are the discussions at?

Adrian Volintiru: Romgaz also wants the same thing that the minister has announced. We are very resolute when it comes to acquiring the 50% package from the Neptun Deep deposit and by December 31, 2020 we have to submit a binding offer to ExxonMobil.

Reporter: What other investment projects do you have planned and what projects do you intend to develop in the region?

Adrian Volintiru: Regarding our expansion on the natural gas market, on the offshore and onshore segments in Romania, we want to purchase other concession packages, but I cannot provide details on the subject yet.

Romania is the second country in the EU in terms of resources. It is a good thing to expand in Romania, so we can increase the resources available to Romgaz.

Reporter: How is the Halânga project you are working on together with GSP coming along?

Adrian Volintiru: It is going very well too, but the situation is the same here as it is in Iernut - the investor makes the investment, not Romgaz, we are just the beneficiary. As far as I know, the project is in line with the forecasts.

Reporter: How do you see the concern of the EU for hydrogen as a new fuel and what concrete plans does Romgaz have in that regard?

Adrian Volintiru: We are very interested in this aspect. Moreover, we are about to identify partners to move forward with this project as well. We will find solutions and partners as soon as possible to enter this market, which also helps us to fulfill the decarbonization program.

Reporter: Last month, the stock market indices have seen the biggest drops since March. How would you describe the evolution of the Romgaz stock price?

Adrian Volintiru: Romgaz stock has been rising for a few days and we hope to have a healthy, consolidated growth.

Reporter: Since winter is about to begin, like we do every year, we are going to ask you whether you have enough gas stocks so the country can last through this winter...

Adrian Volintiru: As far as Romgaz is concerned, I only have on thing to say - output is near its maximum, and storage is almost full, so we will have plenty of heat this winter.

Reporter: Thank you!

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