ACQUIRING REAL ESTATE IN ROMANIA

By courtesy of the National Agency For Mineral Resources (NAMR)

NAMR is a specialized body of the central public administration, under the subordination of the Government, legal person under the direct coordination of the Prime Minister’s Cabinet.

It is in charge with applying the provisions of the Mining Law No. 85/2003 and Petroleum Law No. 238/2004 in the field of prospecting for/exploration/exploitation of all mineral resources, including petroleum and petroleum transportation through the national pipeline system, public property of the State.

Its competencies are as follows:

 Mining

 In Romania is enforced the Mining Law (No.85/2003) which is aligned to the international current practice.

The diversity of the geological formations  and the complexity of deposit types, together with the fact that Romania was isolated in the last 50 years from the international mining community, led to an important afflux of foreign investors.

In the current exploration and exploitation Public Offers, NAMR provided many mining perimeters for different minerals.

A new Public Offer for exploitation will be announced and published in NAMR's web site: www.namr.ro

Main mineral resources/reserves recorded by NAMR at 1st January 2006 Report are:

1. LIGNITE                                                              13,828 mil. tons
2.

HARDCOAL

2,226 mil. tons
3. COPPER   ORES (Cu < 0.40%)  1,827 mil. tons
4.

COPPER  ORES (Cu > 0.40%) 

977mil. tons
5.

POLYMETALLIC  ORES

368 mil. tons
6. NATURAL  SALT    35,696 mil. tons

Since the Mining Law was approved, NAMR has concluded 6,847 exploration/exploitation licenses and permits with Romanian and foreign companies, as follows:

 * Various  Ores                 302
* Coal                                125
* Mineral Waters                 433
* Nonmetalic substances  5,838
  and useful rocks
* Other substances             149

In the current exploration and exploitation public offering, NAMR proposes many perimeters for different minerales.

Mining Law*

Mineral resources are exclusive public property and belong to the Romanian State.

The mineral resources which are the subject of the present law are: coal, ferrous and non ferrous ores, aluminum rocks and minerals, noble, radioactive, rare and disperse metals, salts, non metallic useful substances, useful rocks, precious and semiprecious stones, peat, mud and therapeutically peat, bituminous rocks, non combustible gas, geothermal waters, gas associated to them, natural mineral waters (gaseous and non-gaseous), mineral therapeutically waters, as well as mining residues from barren dumps and tailing ponds.

Mining activities  will be conducted on the basis of an exclusive license, concluded and signed by NAMR with a legal person.

Romanian and foreign legal persons are treated as equal. 

Exploration Licenses

The exploration license is granted for an initial term of maximum five years with a renewal right for three years.

The agreed exploration program shall be carried out in whole the until exploration license expires

The Title Holder has the right  to reduce the exploration area, with the Competent  Authority agreement, on the basis of phases reports, providing that all the necessary environment works were executed, having the obligation to carry out   the exploration works for the first year.

The Title Holder shall pay an annual fee in advance.

The Title Holder has the right to obtain the exploitation license upon request.

Exploitation Licenses

The exploitation licence is granted for an initial period of 20 years, with the right of continuation for succesive periods of five years each.

The Title Holder will pay an annual tax on surface and a mining royalty, calculated as a percentage  from the value of production.

The Title Holder has the following rights:

- to obtain, keep and use the existing data and information related to the license area;

- to dispose of the quantities of produced mineral resources;

- to associate with other legal persons;

- to have access to the lands.

Oil and Gas

Background of the  Romanian Petroleum Industry

- 1857      - FIRST RECORDED CRUDE OIL PRODUCTION IN THE  WORLD
- 1909      - FIRST NATURAL GAS PRODUCTION
- 1913      - FIRST EUROPEAN GAS PIPING SYSTEM WAS BUILT IN TRANSILVANIA
- 1935      - 6th PRODUCER IN THE WORLD - 8.4 million tons
- 1976      - PEAK OF OIL PRODUCTION - 14.6 million tons
- 1986      - PEAK OF NATURAL GAS PRODUCTION - 36.2 billion C.M.
- 2005      - CURRENT CRUDE OIL PRODUCTION - 5.5 million tons
- 2005      - CURRENT NATURAL GAS PRODUCTION - 13.0 billion C.M.

Current Status (Exploration Blocks)

under  agreement

PETROM

- I Adjud, II Slanic Bai, III Berca-Arbanasi, IV Valenii de Munte, V Baicoi,
VI Targoviste, VII Urziceni Vest, VIII Urziceni Est, IX Bucuresti, X Craiova,
XI Strehaia, XII Pitesti, XIII Targu Jiu, XIV Marghita, XV Oradea, XVI Arad,
XVII Timisoara, XVIII Istria, XIX Neptun.

ROMGAZ   - Transilvania Nord, Transilvania Centru, Moldova Nord, Moldova Sud, Muntenia Est, Muntenia Vest, Oltenia
ROMGAZ
WINTERSHALL         RG3 Transilvania Sud 
EUROPA OIL&GAS   EPI-3 Brates
MORAVSKE NAFTOVE DOLY
ROMPETROL           EPI-5  Gresu, EPI-6 Nereju, EIII-5 Focsani, EIV - 3 Zegujani EIV -   5 Satu Mare,
CENTAUR                 EII -1 Sud Bucuresti
PALADIN
STERLING                    Pelican, 15 Midia
GTI                               EII-2 Pancota

STERLING`                   EIII-7 Sud Craiova
PANNONIAN                 EIII-11 Valea Jiului
AURELIAN
EUROPA OIL & GAS
MILLENNIUM                 EIII-4 Bacau
AURELIAN
ROMGAZ
EUROPA OIL & GAS
MILLENNIUM                EIII-1 Brodina, EIII-3 Cuejdiu
TOREADOR                  EIV - 2  Viperesti, EV - 1 Moinesti
REGAL                         EIV - 1 Suceava, EV - 2 Barlad
AMRO GOLD                 EV - 3  Banat Est

Current Status (Production Blocks)

300 Blocks under agreement with SNP PETROM
121 Blocks under agreement with SNGN ROMGAZ
39  Blocks under agreement with Other Companies
(local and foreign companies)

Bidding Procedures

Block general data packages for each block are available for use on  a non-exclusive basis.
Block general data packages include seismic sections and logs.
The purchase of a license to use a block general data package and the signing a confidentially agreement are conditions to participate in the round.
Additional data both from the block and adjacent open area are available.
A company may bid for one or more open blocks in its own right, or on behalf of  a consortium.
For purposes of evaluation by NAMR, the bidding package shall contain:
- the qualification document showing both technical and financial capabilities
- a minimum exploration program and expenditure commitment.

The bidding Procedure and Model Concession Agreement  are available upon request to NAMR

Petroleum Law*

Petroleum  resources are public property and belong to the Romanian State.
Petroleum Operations shall be achieved on the basis of petroleum agreements signed with NAMR
Petroleum Agreement stipulates the minimum compulsory work program.
Romanian and foreign entities are treated as equal.
Non discriminatory right of acces to pipeline and other facilities.
Export right for the produced petroleum.
Assignment right.
Flexibility: most of its provisions can be negotiated.
Fiscal and commercial stability are guaranteed.

Concession Agreement Model*

The term of the petroleum agreement shall be not more than 45 years including exploration.
The initial exploration period is negotiable, but no more than 5 years.
Additional exploration period can be negotiated.
Minimum exploration work program and related expenditure, including seismic and drilling, are negotiable.
A full environmental study shall be undertaken prior to commencement of the minimum work program.
A bank guarantee shall be required to cover timely performance of the minimum exploration program.
The royalty level for hydrocarbon production.
Unitisation shall be required when necessary.
Training of Romanian personnel and technology transfer shall be required.
Relinquishment of portions of the block is allowed up to the entire block if there is not commercial discovery.

Business Opportunities 

- Application for prospecting permits

    - Issued by NAMR for open acreage, on non-exclusive basis.

- Proposals for new blocks in open  areas

- Right granted by the: Petroleum Law.

The new blocks are selected and offered for concession in the next   bidding round Mining Law.

The new blocks are selected and proposed for concession in next semestrial public offering

- Participation in the Licensing Rounds
- Concession agreements for petroleum exploration and production signed with NAMR    and  approved  by Government.
- Exploration licenses signed with NAMR;
- Exploitation licenses signed with NAMR and approved by Government.

Other Information
For further information, please refer to NAMR's web site: www.namr.ro  where you can find details about:
 - Mining Law, Petroleum Law, Environmental Law and other useful legal information.
 - Oil&Gas and Solid Minerals Licensing  Rounds.
 - Concession Agreement Models.
- World Bank financed Projects in Mining  Sector.

NATIONAL AGENCY FOR MINERAL RESOURCES
Address: 36-38, Mendeleev St.,
010366
, BUCHAREST
Phone: +40- 21- 317.00.18, 317.00.95, 317.00.94
Fax: +40- 21- 317.07.80
INTERNET Address: http://www.namr.ro

 

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