OMV revises plans for Romanian refineries

OMV is trying to hold onto its liquidities, considering that the price of oil has fallen sharply and Romanian refineries are not profitable.

“Anything is possible, considering that one of the key factors is cash-flow, and market evolutions will also play an important part,” Roiss, member of Petrom’s Supervisory Board, told the Bloomberg news agency.

The Austrian group has already cut its total investment plans for 2009 by one third, to preserve liquidities, considering that the fuel demand is down, due to the global recession.

OMV modernized the three refineries the group has in Western Europe, while the Romanian refineries are unprofitable due to major energy consumption and low diesel oil production, according to Bloomberg. The two refineries OMV has in Romania posted annual operating losses worth some €200 million, and would require investments worth up to €1.5 billion to be brought up to Western European standards. Petrom announced a 48 percent decline in net profit in the first quarter of 2009, down to RON 506 mln (€118.6 mln).

The company’s results are affected by risk provisions, considering that the oil producer is confronted with an unprecedented wave of lawsuits from its employees. Petrom, local oil market leader, announced a 26 percent drop in its investment budget in 2009 compared to 2008, to RON 4.7 bln (€1.1 bln).

Through its two refineries, Petrobrazi and Arpechim, Petrom owns the largest refining capacity locally, of an annual eight million tons.