Go-ahead sets the seal on development of $4.4 billion deepwater gas project in Black Sea

Romania’s National Agency for Mineral Resources has endorsed the development plan for a massive deepwater natural gas project in the Black Sea. This was submitted by the project’s operator, OMV Petrom, South-Eastern Europe’s integrated energy company, which describes this project as Romania’s first deepwater project and “the largest natural gas project” in the Romanian area of the Black Sea.

This comes two months after OMV Petrom approved, together with its partner – Romgaz, Romania’s producer and main supplier of natural gas – the development plan for the Domino and Pelican South commercial natural gas fields in the Neptun Deep block offshore Romania and a little over a month after the duo submitted it to the National Agency for Mineral Resources for endorsement on 21 June 2023.

As the National Agency for Mineral Resources has endorsed this development plan, the Neptun Deep project is entering the development phase, which includes the execution of drilling activities and construction of the infrastructure necessary for the extraction of natural gas, with the first production estimated for 2027.

Razvan Popescu, Romgaz CEO, commented: “The confirmation of Domino and Pelican South natural gas commercial reservoirs development plan, by the National Agency for Mineral Resources, represents the phase in which the actual development of commercial reservoirs begins, a new milestone for Neptun Deep project. This important milestone is proof that the decision to invest in Neptun Deep project was an accurate one, in Romgaz benefit as well as ensuring and consolidating the energy security in Romania.”

OMV Petrom is the operator with a 50 per cent interest in the project while Romgaz is the firm’s partner in this project, and holds the remaining 50 per cent. The two players intend to invest up to €4 billion or almost $4.4 billion for the development phase of the project to be spent mostly during 2024-2026, which will enable about 100 bcm of natural gas to be brought on stream, turning Romania into – what OMV Petrom deems to be – the largest gas producer in the EU and a net natural gas exporter.

Aristotel Marius Jude, Romgaz Deputy CEO, remarked: “We reached a major target for Neptun Deep project, namely confirmation of resources and reserves in Neptun Deep block. We will remain engaged in reaching this project’s objectives, which shall result in indisputable benefits for Romania’s energy independence. On behalf of Romgaz, we thank all teams that were involved in this project and the National Agency for Mineral Resources for the continuous efforts in reaching this target.”

Moreover, the infrastructure required for the development of the Domino and Pelican South offshore natural gas commercial fields includes ten wells, three subsea production systems and associated flow lines, one offshore platform, and the main natural gas pipeline to a natural gas metering station near Tuzla.

According to the operator, the platform generates its own energy, operating at the highest standards of safety and environmental protection. The offshore platform, wells and fields will be operated remotely, through a digital twin, enabling process optimisation. It is expected to contribute to the improvement of environmental performance, by making energy consumption more efficient and minimising emissions.

The exploration activities in the Neptun Deep block, undertaken since 2008, included two 3D seismic acquisition campaigns and two exploration drilling programmes. The first natural gas discovery at the block was made in 2012 and the total exploration and appraisal expenses to date amount to more than €1.5 billion or close to $1.64 billion.

Located at about 160 km from the shore, in waters between 100 and 1,000 metres, the Neptun Deep block in the Black Sea covers an area of ​​7,500 square km. The carbon footprint of this project is expected to be better than the industry benchmark, as at plateau production, a carbon footprint of around 2.2 kg CO2/boe is anticipated which is below the industry average of 16.7 kg CO2/boe as per IOGP.