Petrom Finalizes Sale of MODUs
Gheorghe Constantinescu, Petrom CEO: "This transaction demonstrates our commitment to focus on our core business, in order to deliver good returns on our asset base. In line with other international oil companies, Petrom does not have sufficient in-house expertise in the off-shore services business, and therefore we do not believe that the significant investments that the off-shore drilling units require in order to be able to operate internationally are the kind of projects that Petrom should be financing at this stage."
The offshore mobile drilling units that are subject to the transaction are Atlas, Fortuna, Jupiter, Orizont, Prometeu and Saturn. The total consideration payable for these assets amounts to the RON equivalent of US $100 million. The transfer of ownership is expected to occur in January 2006.
Petrom's rationale for undertaking this transaction is to concentrate on its core business. The operation of mobile offshore drilling units is a specialized area of oil-field related services which requires a specific focus and expertise. Petrom's needs for such services is limited, and there is no other significant demand for such services in Romania – consequently Petrom had been seeking to utilize these assets internationally for a number of years, by offering offshore drilling services to other oil companies. Two of the drilling units, namely Fortuna and Orizont, have been operating in the Persian Gulf since 2000, while others were also used outside Romania on various occasions.
In connection with the sale of the mobile offshore drilling units Orizont and Fortuna, Oriental Oil Co. has agreed to release Petrom of its obligations under the existing contract for the lease of the drilling units Fortuna and Orizont, Petrom's position as a contractor being assumed by GSP.
GSP is a Romanian company which specializes in oil-field related services business. Since 2004, GSP is operating the drilling units Fortuna and Orizont under a services contract with Petrom.