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Romania has a long and successful history of

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PENNYBUSTER   Wednesday, 02/22/12 06:33:34 PM
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Romania has a long and successful history of petroleum exploration and production. Since o il p roduction was established in 1854, in the order of 475 oil and 450 gas fields have been discovered in numerous sedimentary basins. Romania has estimated proven remaining oil reserves of 1.4 billion barrels, the largest in mainland Eastern Europe. While the country established itself as a major oil exporter, the lack of investment over the last three decades, combined with maturing fields, has resulted in the steady decline of production to approximately 115,000 bopd. As a consequence, Romania now relies on imports to meet half its domestic oil demand. Gas production has also fallen in the country, with annual production at 9.5 bcm (920 mmcf/d). Proven reserves now estimated at 21 TCF.

The Government is taking steps to attract foreign investment for oil and gas exploration and production, both on land and in the Black Sea, by establishing competitive bid rounds and offering industry attractive fiscal terms. In a move to encourage more foreign participation, the Government sold controlling interest the state oil company Petrom to Austrian-based OMV, paving the way for more foreign investment and higher efficiencies in the oil industry.

Romania dominates southeastern Europe's downstream petroleum industry, holding ten of the region's eleven refineries. Because its refining capacity far exceeds domestic demand, Romania exports a wide range of oil products and petrochemicals.

Romania is a country of growing interest for a number of foreign firms due to the attractive fiscal terms being offered, the emergence of unconventional resource plays and the clear opportunity to apply modern exploration and producing technologies to more fully exploit older fields. . Until recently, exploration typically involved drilling shallow structural closures using 2D seismic data. Significant exploration potential remains in untested deep structural closures and stratigraphic traps.

East West Petroleum selected Romania for its eastern European entry because of the country's technical opportunities and attractive commercial terms offered by the Government. Other positive factors include the country's well-established infrastructure, very competitive oil and gas producer prices and the availability of large acreage blocks which offer both conventional and unconventional potential.
Exploration Blocks Awarded

East West Petroleum was awarded four exploration blocks in the Pannonian Basin of Western Romania covering 1,000,000 acres with conventional and unconventional potential in the 2010 Romanian licensing round.

Romania Key Success Factors

The work program consists of 2D, 3D and three wells on each 1,000 km2 block
EWP is positioning itself to reduce exploration financial exposure and risk through partnering and carries.
EWP has entered into a MOU with NIS, the Serbian National Oil Company under which our partner will provide all exploration capital and a full, 15% carry through to commerciality
The acreage holds both conventional and unconventional oil and gas potential

Romania Exploration Potential

The following provides a summary of the exploration potential and scoping economics for these exploration blocks:
Block Exploration Potential Scoping Economics
Tria (2) 11 leads delineated over 1,700 - 5,000 ft. with size up to 40 mmbo (oil prone). Fields nearby. Bright spots evident on shallow seismic data. Unconventional gas potential 38 mmbo discovery delivers NPV (@10%) of $316 mm unrisked (NPV $28 mm risked with IRR of 35%)
Baile Felix (3) Six leads delineated over 2,000 - 5,600 ft. range with size up to 50 mmbo. Oil shows in wells. Unconventional gas potential. 63 Bcf discovery delivers NPV (@10%) of $77 mm unrisked (NVP $20 mm with IRR of 35% risked)
Perian (7) Four leads over 2000 - 12,000 ft. range. Potential for structural & stratigraphic traps. Multi-tcf unconventional gas potential. 14 mmbo discovery delivers NPV (@10%) of $135 mm unrisked (NPV $14 mm with IRR of 35% risked)
Biled (8) Nine leads over 7,000 - 11,000 ft. range with size up to 100 Bcf / 46 mmbo potential. Fields nearby. Multi-tcf unconventional gas potential exists. 34 mmbo discovery delivers NPV (10) of $323 mm unrisked (NPV $93 mm with IRR of 49% risked)

Romania Property Flyer Download (PDF File)

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