Newspaper article The Christian Science Monitor
Romanian Oil Industry Strives for a Comeback Foreign Oil Companies Drilling Deep Test Sites
ROMANIA'S oil and gas industry has been in decline for a long, long time.
Perhaps the world's first major commercial oil producer, Romania still has the largest reserves in Eastern Europe. But the massive oil fields near Ploiesti and Bacau -- seized by Hitler to run his war machine, bombed mercilessly by the Allies, and exploited to fund former dictator Nicolae Ceausescu's mad prestige projects -- are clearly running dry. Oil production has slumped by 53 percent since 1975, forcing Romania to spend an ever-increasing share of its hard-currency earnings on energy imports. Such imports -- much of it crude oil -- now comprise two-thirds of total imports.
"It's necessary to spend far too much of our export earnings on raw materials like energy," says Romanian economist Ilie Serbanescu. "There's never enough money remaining to import needed technology and modern equipment."
But there are high hopes that newly commenced exploration work may give the oil and gas industry a new lease on life, improving the country's economic prospects. Three major Western oil companies -- the British-Dutch giant Shell, Chicago-based Amoco Corporation, and Britain's Enterprise Oil -- are each engaged in drilling test wells at sites in Transylvania, the eastern Carpathians, and the Black Sea respectively, in an effort to locate deep new reserves of oil and natural gas.
"We're looking for significant fields," says Michael Adams, president and residential manager for Amoco Romania. "We're a big company and it's going to have to be something more than average size-field to justify our setting up an operation here."
If significant reserves are found, a single production operation would likely cost hundreds of millions of dollars, and possibly as high as $1 billion -- as much as has been invested by all foreign companies operating in post-Communist Romania to date.
"This would be an enormous boost for the Romanian economy," says Miron Bojinca, a Romanian Development Agency petroleum expert. "It will probably be several years before we know what's out there."
Petrom, the Romanian state oil and gas company, has been searching for new reserves for years, but lacks the modern exploration and drilling equipment required to explore deep reserves on the six blocks it retains. …