Italy's Eni bows out of Petrom race

The series of withdrawals of the world’s oil giants from the Petrom privatisation race came to an end when the Italians from Eni decided to leave the competition, following the lead of ConocoPhilips, Alon and TNK BP.

From now on, the regional companies stay in the game, as well as Occidental (USA), Gazprom (Russia), Glencore (Switzerland).

Italian company Eni SpA sent a letter announcing it would no longer take part in the privatisation process of the National Oil Company (SNP) Petrom, the Economy and Trade Ministry said at the end of last week, without giving any further details.

Italian oil giant Eni withdrew before submitting a final offer for Petrom. Posting annual revenues of 48 billion euros, Eni is the second strategic investor to leave the competition, after the US oil corporation ConocoPhilips – whose annual revenues amount to 57 billion euros.

From this point on, the Romanian State will be in talks with seven investors to take over 51% in Petrom, among which the compact group of the regional companies stands out – OMV (Austria), MOL (Hungary), PKN (Poland) and Hellenic Petroleum (Greece). Other competitors are the Russian gas producer Gazprom, Occidental (USA), and the trade company Glencore, which has been for years one of the most active companies working with Petrom. Furthermore, Gazprom is one of the world’s largest companies (posting sales of $20 billion, which exceed Romania’s exports), but its core business targets the natural gas.

Many of the withdrawals are blamed on the lack of partners needed to form consortia, considering none of the companies disclosed the reasons for their decisions. Economy and Trade minister Dan Ioan Popescu recently stated that all the players interested in Petrom had had preliminary talks to form consortia, but the solutions were never applied. Analysts estimate the transaction is worth $1 – 1.3 billion.

adrian.mirsanu@zf.ro