EBRD AND EXPERT PETROLEUM JOIN FORCES
The European Bank for Reconstruction and Development (EBRD) is providing a USD 5 million loan to Expert Petroleum to finance the enhancement of Romanian mature oil and gas onshore fields.
As the domestic oil and gas production declines and commodity prices are lower, several existing onshore oil and gas mature fields requires investments and focus to continue to be economically viable, compliant to the latest environmental regulations and to ensure the recovery of the hydrocarbon reserves is optimized.
The EBRD loan will help Expert Petroleum to optimize its capital structure and invest into energy efficiency upgrade and production enhancement projects. The Bank’s investment will contribute to make the oil and gas assets operated by the company safer, cleaner, more productive and more viable for longer time.
“We are very pleased to support Expert Petroleum as it continues to provide an innovative and unique approach in the rehabilitation of mature oil and gas fields and ensure domestic hydrocarbon resources are more efficiently recovered,” Eric Rasmussen, EBRD Director for Natural Resources, stated.
In his turn, Ghiath Sukhtian, Chairman of Expert Petroleum, added: “We are delighted to expand our long-lasting cooperation with the EBRD. They are a key partner in our ambition to modernize and optimize mature onshore oil and gas fields in a clean and safe environment.”
The Project supports the company in optimising its capital structure and investing into energy efficiency upgrade and production enhancement projects. It is expected to have positive transition impact through: Setting standards of corporate governance and business conduct - green economy transition by supporting energy efficiency upgrades; Demonstration of new products - the project will demonstrate that technologically advanced secondary hydrocarbon recovery can be run as an independent viable business.
Expert Petroleum is an agile and lean organization specialized in mature oil and gas fields operations optimization, workforce development, energy efficiencies, production and reserves enhancement. The company operates 18 mature oil and gas fields with 400 producing wells in Romania, employing over 1000 people. It is part of the GMS Holdings group which is a large private family investment group of diversified international businesses.
ENVIRONMENTAL AND SOCIAL SUMMARY
Categorised B (2014 ESP): Environmental and social due diligence (ESDD) conducted by the bank has shown that the E&S impacts associated with the project are site specific and are being appropriately addressed by the company. Company’s E&S provisions are generally in line with good international practice although some improvements are required to ensure full alignment with the EBRD’s Performance Requirements. These improvements are captured in an Environmental and Social Action Plan (ESAP), which has been agreed with the company.
The company has in place a robust E&S management system certified to ISO 14001 and OHSAS 18001 standards and which is underpinned by a full suite of plans, procedures and policies. These are applied to all project facilities to address both past and present E&S issues and risks.
Through the PEC the company has taken over 13 mature fields many of which are associated with conformity and contamination issues from previous operations. The company is in the process of addressing these issues together with OMV Petrom and has made significant improvement since 2013. These activities will continue and will do much to address historical liabilities and also replace, redevelop and decommission old and defunct equipment and facilities. These investments will result in energy and greenhouse gas savings. Company’s HR provisions are in line with PR2 requirements.
Through the optimisation of operations, the company is in the process of staff reductions. These are being conducted in line with PR2 and in discussion with the relevant workers union. Work and community health and safety is managed through the overarching management system and the company has demonstrated good H&S performance to date. The company maintains good relations with communities and authorities through regular engagement and information disclosure. A Stakeholder Engagement Plan will be required for major development works such as new wells. The company will be required to report to the EBRD on an annual basis on its E&S performance and the implementation of the ESAP.