The secrets of the Petrom privatisation

7. Juli 2006, 00:00

Funds for payment of environmental damages, erasing of historical debts, tax stability in the exploration and...

Funds for payment of environmental damages, erasing of historical debts, tax stability in the exploration and production sectors and the geological quota are the main benefits received by OMV, Romanian Capital writes.

The Petrom privatisation contract, which has been much debated in the last months, was presented exclusively by the Capital weekly. This document reveals that the Romanian state has assumed responsibility for any unknown costs that might appear in the following years at Petrom, resulting from the pollution caused by the company before its privatization. The sum amounts to EUR 178.55 million. The document has dozens of pages that establish the investments or damages to the environment.

Secondly, "all fiscal taxes and expenses that Petrom owed for each financial year preceding December 31, 2003, have been paid or annulled by the state." The contract also stipulates that "the current level, the calculation basis and method for the payments made by Petrom in agreement to the individual leasing contracts will be maintained for a period of ten years from the time the contract was finalized.

Page 41 of the contract shows that "when the seller or the entity that has the specific right to sell continues to own more than 10 per cent of the shares, in the case of a crisis (lack of oil or oil products on a long term), the buyer will consult the Ministry of Economy regarding a reasonable course of action, including refraining from exporting oil." When Petrom was privatised, the state granted OMV "a fiscal deduction for the development and modernization of exploration, research and oil production, of 35 per cent of the value of production calculated on the basis of the number of tons of oil produced."

Additionally, the contract states, "The geological quota will be introduced in the Fiscal Code and will be maintained from January 1, 2005 until December 31, 2006. Fiscal losses resulting from the application of the geological quota will be eligible to be treated according to article 26 in the Fiscal Code, regarding the recuperation of fiscal losses, Capital concluded.

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