Rompetrol, investment plans of 240 million USD in 2010

The Rompetrol Group N.V. (TRG) shall continue in 2010 to consolidate and develop its activities in the 12 countries where it operates, the total value of investments for the next year amounting to over USD 240 million. For this year, the Group forecasts approximately USD 7 billion in turnover.

One of the Group’s objectives for 2010 – 2011 is also to continue the program to increase the processing capacity of Petromidia refinery by approximately 25%, up to 5 million tons of raw material, provided that refining margins decrease and lower demand of oil products have determined the downsizing / closing down of certain refineries in Europe.

This year, KazMunaiGaz granted Rompetrol Group financial support of over USD 1.1 billion for working capital needs and the reimbursement of certain bank loans. In 2008-2009, KazMunaiGaz provided financial support amounted to USD 1.8 billions.

As for the obligation to initiate and perform public take-over offers for Rompetrol Rafinare and Rompetrol Well Services, the Rompetrol Group shall continue to undertake all the measures provided by law, but reserves the right to implement each and every regulation in force for the protection of its employees, shareholders and activities developed within and outside country borders, against any potential pressures on the fulfillment of this process.

We need to specify that the decisions and explanatory notes of the NSC have been observed by the Group, its actions and decisions always being in the spirit of the law, transparency and respect towards the investors on the capital market.

Thus, Rompetrol initiated the mandatory public take-over offers further to the adoption of the instruction regarding the direct and indirect holdings, and it followed all the steps provided by law for the completion of the documentation necessary for the launch of the public offers. TRG selected a different valuator (KPMG Romania) and submitted new offer documentations, provided that the ones initially submitted were correct and complete.

Moreover, the Group notified to the regulatory authority the price of this year transaction between Rompetrol Holding Switzerland and KazMunaiGaz regarding the acquisition of the 25% stock of shares, an agreement concluded between two companies with foreign capital related to another foreign company.

Taking into consideration that TRG represents the interests of the company KazMunaiGaz in Romania and that it directly and indirectly owns the majority stock of Rompetrol Rafinare and Rompetrol Well Services shares, it is, according to the legal provisions, the entity entitled to initiate and perform the public take-over offers.

Lately, the Group took note of a series of interpretations and declarations meant to put pressure on the process of review of the documentations related to the offers and on future decisions, from various groups of interests, which are presently affected by the decrease of the share value.

In order to reiterate the good intentions and the transparency of the Group in launching and completing the take-over offers, Rompetrol shall make available to the representatives appointed by the relevant authority, under confidentiality terms, the contract concluded between Rompetrol Holding Switzerland and Kazmunaigas Kazakhstan for the acquisition of a participation of 75% of the TRG shares.

In reviewing the documentation related to the take-over offers, the regulatory authority shall take into account the methods provided by law (e.g. valuation reports submitted) and not some other interpretations that don’t have any relevance within this process. Issued in 2003, the convertible bonds issued by Rompetrol Rafinare on account of a debt accumulated under difficult economic conditions are regulated by the Governmentţs Emergency Ordinance 118/2003, the measure having been endorsed by the Parliament and validated by the Competition Council.

According to the law, the interest afferent to the issue*, the price and redemption / conversion method have been established in 2003. The deadline for their redemption/conversion is September 2010, and the decision belongs to the shareholders of the company and of the Group and shall be taken to the best interests of the Romanian and Kazakh Governments.

On account of the bonds, the Group paid to the state budget, since 2004 until now, interest amounting to USD 226 million, their total value on maturity to reach USD 250 million.
The Rompetrol Group continued to be an important contributor to the Romanian state budget, as for the first 9 months of the current year, the Group’s contribution amounted to USD 737 million. In 2008, the total contributions of the Group amounted to USD 1.2 billion, 9% more than in 2007.
During December 2007 – December 2009, the total number of Rompetrol employees increased by approximately 5%, up to 9600 employees.

* - The annual interest related to the bonds is established based on the annual evolution of the EURIBOR ratio (Euro Interbank Offered Rate), plus 1.5%