The Rompetrol Group will invest during the next two years more than $140 million in its main division, Rompetrol Rafinare (Petromidia refinery), in order to maintain European standards for fuel quality and environment. The financing of this complex investment program will be covered 70 percent from cash flow resources, and the remaining 30 percent from medium or long term loans. About 15 percent of the total amount represents projects already started and due for completion in 2006.
The program aims to increase by 38 percent the refinery’s crude processing capacity (from 3.6 million tons to 5 million tons per year), achieve fuel compliance with the EU standards, as well as compliance with the European environment protection regulations, by obtaining the integrated environment license. These goals are part of the group’s medium term strategy focused mainly on boosting up the refining capacity and developing “state-of-the art” technologies – for processing heavy crude, with high sulfur content, but cheaper.
Among this year’s projects are included a new hydrofining and vacuum distillate conversion unit - Mild Hydrocracking ($90 million), extension of loading Pier 9 and of the adjoining storage facilities ($9 million), as well as the acquisition of a new cut isomerisation plant ($18 million) that will allow the production increase of Euro 5 fuels.
Another important part of the program is the modernization of the HPR plant, valued at $2.65 million. It will enable an increase by 40 percent of the capacity to process reactor crude. This shall be done by replacing the hydrofining reactor and by acquisition of a suitable catalyst for advanced sulfur recovery up to 8 ppm, standard level for Euro 5.
Last year, the group started the development of a coal briquettes plant, with a 40 tons/hour capacity and valued at about $9 million, aimed at obtaining a new type of home heating fuel with high energetic value. At the same time, the modernization of the automatic inline blending unit, worth almost $4.7 million, will increase the efficiency of the diesel manufacturing process, by increasing the volume of cheap components used, but also by reducing the quantity of additives used.
In view of Romania’s accession to the European Union and the adoption of the European environment standards, Rompetrol initiated last year a number of major impact projects, including the refinery tanks rehabilitation ($31 million), upgrade of the sludge processing plant (almost $6 million), as well as the modernization of the recovery gases incineration system ($5,8 million).
The transition period – temporary exemption from the implementation of the European regulations, obtained by Rompetrol Rafinare for compliance with the provisions of Directive 96/61/CE (IPPC-Integrated Pollution Prevention and Control) spreads out until December 31, 2012. At the moment, in full observance of the legal provisions (including the valid environment licenses) the refinery is in the final stage of obtaining the environment integrated license.
In 2005, the total value of the Group’s investments on upgrading the refinery exceeded $43.7 million, including completed projects as well as projects in different stages, started the previous year. The environment projects represent almost $7.5 million from this figure.
Last year Rompetrol conducted research project valued at $1.8 million to support the increase in the production capacity, and to ensure it reaches European sulfur content standards for fuel for the 2005 – 2009 period. Research investment is estimated to reach $2.3 million this year.
Rompetrol Rafinare estimates gross revenues of $2.43 billion for 2006, an increase by 24 percent compared to last years’ figure of $1.99 billion. The company supplies almost 30 percent of the domestic fuel demand, being an important player on the Balkan market.