Rompetrol Rafinare (Petromidia Refinery), part of the Rompetrol oil group run by businessman Dinu Patriciu, will be listed on the Bucharest Stock Exchange (BSE) as of April 5 at a par value of 1,000 ROL.
The shares of the refinery used to trade on RASDAQ until last November, with the last quote there reaching 75,000 ROL, while the par value was 214,000 ROL (350 ROL at the 1,000 ROL par value).
Dinu Patriciu believes his company's shares will make strong competition for state-owned rival Petrom's, now at their peak: SNP has been trading for more than 2,000 ROL, which pushed the company's market value to $2.45bn, over $700 million higher than early in the year. "The investors will be looking at the data and results of the refinery, I think they will be interested and the price will perform accordingly," Patriciu said.
He added Rompetrol Rafinare would concentrate the group's distribution operations handled by Romoil (wholesale) now and Rompetrol Downstream (gas station network) in the next four months. Rompetrol has 197 gas stations, 68 of which it owns directly and the rest are franchised.
Rompetrol acquired Petromidia three years ago and the ensuing streamlining turned the refinery around.
Besides personnel cutbacks and retooling operations, one of the strategic directions was to adjust the oil supplying to the capabilities of the refinery.
"We haven't processed Romanian oil for a year and a half now. As far as the domestic oil goes, a big mistake, a thinking inertia, has become manifest: the idea that we are a major petroleum producing country. This inertia has caused Romania to squander two billion dollars. The Romanian oil should have been exported to the Central European market, as the price difference compared with the oil imported from Russia is $25/tonne. The Romanian refineries, which are not exactly state-of-the-art, technologically speaking, should have processed lower quality oil from which to get good products," Patriciu said.
Under the circumstances, Patriciu estimated that only three or four Romanian refineries would actually make it as fuel producers through the next few years, judging the oil industry investment requirements to be worth $800 million in view of compliance with the European standards. "Petromidia needs to further invest $70 million until January 1, 2006 in order to maintain the European standards," the company's chairman said.
Another oil industry problem is the domestic price margin, which is lower in Romania than it is in Europe.
dorin.oancea@zf.ro
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