Societatea Nationala de Gaze
Naturale “ROMGAZ” SA
Board of Director’s
Report
2016
Board of Director’s Report 2016
This page was intentionally left blank
Page 2 of 98
Board of Director’s Report 2016
Strategic Objectives
Review of the Company’s Business
Business Segments
Historic Overview
ROMGAZ 2016 Overview
I.
Highlights
1.1.
Romgaz in Figures
1.2.
Important Events
1.3.
The Company at a Glance
II.
Identification Data
2.1.
Company Organization
2.2.
2.3. Mission, Vision and Values
2.4.
III.
3.1.
3.2.
3.3. Mergers and Organizations, Acquisitions and Divestments of Assets
Company Business Performance
3.4.
3.4.1. Company Overall Performance
3.4.2. Prices and Tariffs
3.4.3. Human Resources
3.4.4. Environmental Aspects
3.4.5. Litigations
Tangible Assets
IV.
4.1. Main Production Facilities
4.2.
V.
5.1.
VI. Management
Board of Directors
6.1.
Executive Management
6.2.
Financial – Accounting Information
VII.
Statement of Financial Position
7.1.
Statement of Comprehensive Income
7.2.
7.3.
Statement of Cash Flows
VIII. Corporate Governance
IX.
9.1.
9.2.
Performance of the Mandate Contract/Director’s Agreement
Objectives and Performance Criteria
2016 Results
Investment
Securities Market
Dividend Policy
5
5
7
13
15
15
16
17
18
20
20
24
26
29
29
34
38
40
47
47
47
53
59
61
63
63
64
67
67
69
73
74
93
93
96
Page 3 of 98
Board of Director’s Report 2016
Dear Shareholders,
If a year ago we viewed 2015 as a tough year, there is no doubt that 2016 was also a year with serious
challenges.
The oil price had a strong decline over the past three years going from a maximum of USD 119 bbl. to less
than USD 40 bbl. in the first part of 2016 before it had a slight recovery reaching in 2016 approximately
USD 59 bbl. and keeping a relatively constant behaviour until the year’s end. Because in most cases
natural gas price is formed based on the oil price, with a delay of 6 to 9 months depending on the price
formula, the natural gas on the international market was increasingly cheaper during 2016.
The Romanian gas market was not spared from this turmoil. In 2016, after a decade of having a
domestic/import gas price ratio far less than one, sometimes of even 1:2, we witnessed a premiere on the
Romanian energy market when natural gas from domestic production was more expensive than natural gas
from the Russian Federation.
As we all know, the free market rules will always lead to choosing the gas source with the lowest price,
irrespective of its origin.
Additionally, “the tax on additional income generated from the deregulation of prices in the gas sector”,
applicable only to Romanian gas producers, had an important contribution to the natural gas market.
Due to the fact that the import gas price significantly lowered in 2016, suppliers/consumers preferred
imports. As a result, in 2016 Romania imported approximately 15.9 TWh, 548% higher than in 2015 when
2.9TWh were imported.
Massive gas imports triggered the decrease of domestic gas production. As such, against the 2.26TWh
increase (+1.86%) of national gas consumption, the contribution of domestic gas decreased by 10.83TWh (-
9.11%).
In spite of a year with difficult and complex economic conditions and with an incoherent and unpredictable
legislative frame that dominates the energy market, Romgaz closed the 2016 financial year with notable
results, among which we highlight:
A net profit of RON1,025 million, corresponding to a 30.0% rate of net profit against the revenue,
increasing by 1.7% as compared to the previous year;
EBIT of RON 1,259 million, corresponding to a 36.9% rate against the revenue, increasing 4.8%
as compared to 2015;
A proposed gross dividend per share of RON 2.49, securing a dividend yield of 9.96% in relation to
Romgaz share price in the last 2016 trading day.
Our future aim is to continue the supply of products and of services that fully meet our clients’ expectations
and to provide for our company, its shareholders and employees stability and sustainable growth conditions,
while adopting a more active involvement in the community.
Given the difficult environment conditions for our company’s activities, we intend to continuously
cultivate and maintain an open and active dialogue with all stakeholders.
I take this opportunity to thank our employees for the efforts they made to achieve performance in most
fields of activity and together we managed to lay the foundation of Romgaz as a company which creates
value for the clients, for the shareholders, for the community and for itself.
Yours respectfully,
Chairman of the Board - Dumitru Chisalita
Page 4 of 98
Board of Director’s Report 2016
Romgaz made a new important hydrocarbon discovery in Romania
As of June 30, 2016, Romgaz announced a major hydrocarbon discovery made on Romanian
territory within the block RG.06 Muntenia Nord–Est, where the company performs petroleum
operations as sole titleholder of the Concession Agreement for Exploration – Development –
Production, pursuant to the Government Decision No. 23/2000 and Government Decision No.
968/ 2011. The discovery was made in the north-eastern sector of the Moesic Platform within
the structural complex Caragele, that has an approximate length of 35 km and was explored
for geological objectives at depths between 1500 m and 5000 m, as part of the company’s
major exploration projects. Production tests completed at two exploration wells, 55 Damianca
and 77 Rosetti, confirmed an important hydrocarbon accumulation in Jurassic calcareous
reservoirs in an interval of about 120 m at a depth of more than 4000 m. DST results on 7mm
and 9 mm chokes predict daily rates between 1400 and 2200 boe/well. The contingent
resource, was assessed between 150 and 170 million boe on the basis of drilling data,
including well geophysics, mechanical cores and fluids extracted during testing, as well as the
estimated size of the trap based on 3D seismic data.
The external audit of gas reserves and resources has confirmed a total of Contingent
Resources in amount of 50.5 billion m3 as compared to 26.8 billion m3 in 2013 (+88%), the
average reserve replacement ratio exceeding the set target.
DeGolyer&MacNaughton began the external audit process of the gas reserves and contingent
resources in Romgaz’ patrimony at the beginning of 2016, and the process was completed by
a Final Report sent to Romgaz on 30 June, 2016.
The results of the Report confirmed the reserve and resource estimations made by Romgaz as
of December 31, 2015, and the annual reserve replacement ratio, which had an average value
of 87.5% for 2013 -2016, exceeding the target set to 70%.
Reserve Status
(bcm/% of total)
Contingent Resources Status
(bcm/% of total)
12.8
15%
10.6
13%
60.9
72%
32.4
64%
5.2
10%
12.9
26%
Proved
Probable
Possible
1C
2C
3C
Page 5 of 98
Board of Director’s Report 2016
Reserve Replacement Ratio
323%
155%
92%
57%
49%
94%
82%
104%
70%
350%
300%
250%
200%
150%
100%
50%
0%
2008
2009
2010
2011
2012
2013
2014
2015
2016
Completion of the first modernization phase of Sarmasel UGS by enhancing the working
capacity to 950 bcm/ cycle
Romgaz, through Ploiesti branch Sucursala de Inmagazinare Subterana a Gazelor Naturale
Ploiesti, commissioned on July 20, 2016 the new unit of the Gas Compression and Drying
Station of Sarmasel (Mures County), an investment exceeding 238 million RON (approx.
EUR 54 million) carried out during the last three years. The new compression and drying
facility of the Sarmasel UGS will allow the working capacity of the UGS to increase from 800
million to 950 million Ncm/cycle, enhancement of delivered gas quality and the daily
withdrawal rate from 6 million to 9 million Ncm/day. The enhancement of the UGS capacity
is mainly due to a new installed compression capacity that will ensure a maximum daily rate
of 6 million Ncm. The gas compression and drying station is fitted with state-of-the art
technology characterized by reduced energy consumption, strictly observing all European and
national requirements as regards environmental protection. The commissioning of the new
facility at Sarmasel is a new benchmark of Romania’s energy security in relation to the
country’s overall UGS capacity. Thus, Romania is able to store 3.3 billion Ncm/cycle. The
investment has also contributed to an enhanced withdrawal capacity to a maximum rate of 30
million Ncm per day.
Extending the exploration phase by five years (2016-2021) for the main eight blocks under
Romgaz concession agreement
In terms of gas exploration – production activities, during 2011 – 2016, Romgaz performed
petroleum exploration operations in eight blocks under the Petroleum Agreement approved by
Government Decision No 23/ 13 January 2000. Thus, the exploration activity was intensified
in the high depth levels of the Transylvanian Basin, the Moesic Platform and the Moldavian
Platform. In these blocks 4705 km2 3D seismic were acquired, 70 exploration wells were
drilled, and contingent resources of approx. 17,000 million Ncm were confirmed. Based on
the positive results obtained by implementing the work program for 2011-2016, Romgaz and
ANRM have decided to continue the petroleum exploration operations in the eight blocks
with a new work program to be performed during 2016 – 2021 by signing an Addendum on
extending the exploration phase for these blocks on September 6, 2016. Once the Addendum
approved by Decision of the Romanian Government, Romgaz is going to identify a long term
exploration potential with the aim of ensuring a constant reserve replacement ratio and the
consolidation of investors’ confidence in the company’s assets.
Page 6 of 98
Board of Director’s Report 2016
Works regarding the “Development of Iernut Thermal Power Plant by Building a New
Combined-Cycle Power Plant (CCGT)ˮ
One of Romgaz’ strategic direction is consolidating its position on the energy supply markets.
Thus, in the field of energy generation, the implementation of this investment project aims to
enhance the efficiency of activity by: increasing the efficiency of the power plant to 56% at
the least, compliance with the environmental requirements (NOx, CO2 emissions) and
enhancement of safety in exploitation. The project is financed from own resources and PNI
(National Investment Plan) funds, in accordance with Government Decision no. 1096/2013,
updated. Romgaz concluded the works contract no 13384/ October 31, 2016 with the
Partnership between Duro Felguera S.A. and SC Romelectro S.A. The contract may be
summarized as follows: (1) the object of the contract is implementation of the turnkey project
(design, delivery of equipment, supply of works and start-up) “Development of the Iernut
Thermal Power Plant by Building a New Combined-Cycle Power Plant (CCGT)ˮ, (2) time
limit for completion of works: 36 months from the date on which the contract enters into force
(the contract enters into force in 5 working days from the date of approving the file of
financing from PNI funds, in accordance with the Government Decision No 1096/2013,
updated), (3) the estimated value of the contract (VAT excluded): EUR 268,836,329.82.
The Company recorded a net profit in 2016, too, in amount of RON 1,024.6 million and a net
income per share of RON 2.66 as compared to RON 3.10 in 2015.
The net profit margins (30.0%) and EBIT margin (36.9%) are higher than the ones reported
last year (29.5% and 35.2%, respectively), and the EBITDA margin (46.0%) recorded a
significant level, confirming that the company continues to maintain a high profitability.
Natural gas consumption in Romania recorded in 2016 an increase of approx. 1.86% as
compared to the previous year, according to the ANRE and the Company’s consumption
estimations, bearing in mind that ANRE has not published the October – December 2016
reports, yet.
The natural gas production of the Company was lower than the 2015 one (4,219 vs 5,563
million m3). This production, according to estimated data, ensured Romgaz a 42.5% market
share of gas deliveries within the consumption of domestic gas, and a 41.46% market share
among gas producers.
The 2016 production was lower than the one recorded in the previous year due to the
challenges the Company faced during this period, namely:
1.
2.
3.
4.
A mild winter generating a low gas consumption in Q1;
Decrease of gas demand in key sectors due to price drop worldwide (especially in the
chemical fertilizer sector, where gas consumption decreased by 12% as compared to
the previous year), and the close competition in the electricity generation sector;
Decrease of gas demand for building up the minimal gas stock for the 2016-2017
winter because of an imprecise and incoherent regulatory framework. Thus, in 2016,
the total quantity injected in Romgaz storages was 305.7 million m3 lower than in 2015
(-18.3%). The withdrawn quantity was lower by 215.8 million m3 (-13.0%);
A relatively large gas stock, Romgaz property, in UGSs at the end of the 2015-2016
winter (the stock in UGSs amounted to 795.8 million m3, out of which Romgaz’ stock
was 723 million m3, representing 92%) – considering that Romgaz injected 389.6
million m3 in 2016 as compared to 723.5 million m3 in 2015;
Page 7 of 98
Board of Director’s Report 2016
5.
Increased competition as regards import gas, induced by a significant drop in gas price
in Europe. Thus, import gas increased in 2016 by 750% to 1.5 billion m3 as compared
to 0.2 billion m3 in 2015.
The 2016 Romgaz electricity production represented 91.6% of the 2015 production, namely
1,628,367 MW and represents 2.68% of Romania’s total electricity production. According to
Transelectrica, Romgaz’ market share was 2.57%.
The table below shows a summary of the main production indicators, royalty and storage
services:
Q4
2015
Q3
2016
Q4
2016
1,428
2,756
106
837
1,201
54
1,185
1,023
84
584.8
391.4
726.3
Main indicators
Δ Q4
(%)
-17.0 Gas production (million m3)
Condensate production (tons)
-62.9
Petroleum royalty (million m3)
Electricity production(GWh)
-20.4
+24.2
2015
2016
Δ ‘16/’15
(%)
5,563
10,947
406
4,219
5,864
292
1,797.7
1,628.3
-24.1
-46.4
-28.1
-9.4
466.6
0.0
509.9 +9.3%
123.0
619.9
65.0
-47.2%
Invoiced UGS withdrawal services
(million m3)
Invoiced UGS injection services
(million m3)
1,656.7
1,440.9
-13.0
1,673.1
1,367.4
-18.3
Natural gas quantities produced, delivered, injected into and withdrawn from gas storages are
shown in the table below (million m3):
Item
No
0
1.
1.1.
1.2.
2.
3.
4.
5.
6.
7.
Specifications
2014
2015
2016
Ratios
Gross production – total, including:
1
*own gas
*Schlumberger (100%)
Technological consumption
Net gas production (1.-1.2.-2.)
Own gas injected into UGS
Own gas withdrawn from UGS
Difference from conversion to Gross Calorific Value
2
3
5,663.9 5,562.7
4
4,219.4
5=4/3x100
75.9%
5,469.0 5,359.7
4,068.0
194.9
203.1
151.3
81.3
78.5
54.5
75.9%
74.5%
69.4%
5,387.7 5,281.1
4,013.6
76.0%
564.8
601.0
9.8
738.4
409.5
16.1
414.7
462.6
56.2%
113.0%
4.5
28.0%
Delivered own gas (3.-4.+5.-6.)
5,414.1 4,936.1
4,057.0
82.2%
8.1. Gas sold in UGS
8.2. Gas delivered to CTE Iernut and Cojocna
-
-
79.2
445.0
527.0
463.7
9.
Own gas delivered to the market (7.+8.1.-8.2.)
4,969.1 4,409.1
3,672.5
10. Gas from joint ventures– total, including:
*Schlumberger (50%)
*Raffles Energy*) (37.5%)
180.6
97.5
0.8
168.9
101.5
0.5
149.0
75.7
0.3
-
88.0%
83.3%
88.2%
74.6%
60.0%
Page 8 of 98
Board of Director’s Report 2016
Item
No
0
11.
12.
Specifications
2014
2015
2016
Ratios
1
*Amromco*) (50%)
Gas purchase from domestic production
2
82.3
17.7
3
66.9
17.1
4
73.0
11.2
5=4/3x100
109.1%
65.5%
Traded domestic gas (9.+10.+11.)
5,167.4 4,595.1
3,832.7
83.4%
13. Gas delivered from domestic production (8.+12.)
5,612.4 5,122.1
4,296.4
83.9%
14.
15.
Delivered import gas
Total delivered gas (13.+14.)
81.1
3.0
6.8
226.7%
5,693.5 5,125.1
4,308.0
84.1%
*) –as regards Romgaz-Schlumberger association, produced gas is fully included in Romgaz production, and
then split in equal shares between the two partners, and traded separately. With respect to the joint ventures
with Raffles Energy and Amromco, the obtained gas does not represent Romgaz production but the value of gas
is reflected in Romgaz revenue, proportionally with its respective participating interest share in the joint
ventures
Natural gas production lies in the parameters forecasted in the 2016 program, achieving
92.4% of the planned production (4,567 million m3 – planned vs 4,219 million m3 –
achieved).
The production level was maintained by the ongoing production rehabilitation projects of the
main fields, workover and recompletion operations for 173 wells, installing new compression
capacities and bringing into production new fields.
The natural gas production during 1991-2016 is shown below:
11.8
10
9.1
8.8
8.4
8
3
m
n
o
i
l
l
i
b
14
12
10
8
6
4
2
0
7.3
7
6.6
6.3
6.2
5.9
5.9
5.8
5.8
5.6
5.7
5.7
5.7
5.6
4.2
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Although most reservoirs are mature, producing for more than 30 years and the volumes
produced have decreased significantly, during the past years the production the decline rate
has been stabilized at around 1% due to a mix of measures taken by the company, such as:
gas compressor stations;
Page 9 of 98
Board of Director’s Report 2016
rehabilitation/enhancement of production, 3D seismic data, static and dynamic
reservoir modelling;
bringing into production new discoveries.
Electricity delivered by CET Iernut in 2016 was lower by 9.27% (y/y), considering the
increased hydro potential, and as a result of putting the energy units 2 and 3 into a dry storage
condition as of January 1, 2016. From the total electricity sold, 25.64% were delivered to the
balancing market.
The sale prices of electricity have exceeded the average prices on all markets.
Romgaz is one of the largest gas suppliers in Romania. The evolution of gas supplies1 during
2007-2016 is indicated below:
m
c
n
o
i
l
l
i
m
739
343
304
680
1018
606
310
81
3
5569
5572
5563
5513
5200
5156
5304
5529
5055
7
4223
7000
6000
5000
4000
3000
2000
1000
0
2007
2008
2009
Gas from domestic production
2010
2011
2012
2013
Import gas
2014
2015
2016
The mild winter in early 2016, the drastic drop of demand in the chemical fertilizer sector, the
decrease of demand for building up the minimal gas stocks for the 2016-2017 winter due to an
imprecise and incoherent regulatory framework, and the increased competition coming from
gas importers, induced by a steep decrease of gas price in Europe are the causes that led to
lower sales.
Item
No
1.
2.
3.
4.
5.
6.
7.
8.
Revenue
Income
Expenses
Gross profit
Profit tax
Net profit
EBIT
EBITDA
Main indicators
2015
2016
*million RON*
Δ ‘16/’15
(%)
-15.8
-11.6
-10.9
-12.8
-6.7
-14.2
-11.6
-29.2
3,411.9
3,816.8
2,536.1
1,280.7
256.1
1,024.6
1,259
1,570
4,052.7
4,315.9
2,847.1
1,468.8
274.6
1,194.3
1,425
2,218
1 comprises own gas from domestic production, including gas delivered to CTE Iernut and Cojocna, 50% of the
gas from Schlumberger joint venture and gas purchased from Romanian domestic production from other
producers
Page 10 of 98
Board of Director’s Report 2016
EPS (RON)
Main indicators
Item
No
9.
10. Net profit rate (% from Revenue)
11.
12.
13. Number of employees at the end of the period
EBIT Ratio (% from Revenue)
EBITDA Ratio (% from Revenue)
2015
2016
3.10
29.5
35.2
54.7
6,356
2.66
30.0
36.9
46.0
6,246
Δ ‘16/’15
(%)
-14.2
+1.7
+4.8
-15.9
-0.2
The figures above are rounded and therefore there may be slight differences after reconciliation
Note: income and expenses do not include in-house works capitalized as non-current assets.
The lower revenue as compared to the previous year is mainly related to weather conditions,
and especially due to the drastic drop of demand in the chemical fertilizer sector, decrease of
demand for building up the minimal gas stocks for the 2016-2017 winter, and the increased
competition from gas importers.
Due to the above mentioned causes, the net profit, EBIT and EBITDA are lower as compared
to 2015. Despite all, the ratios of the first two indicators against the revenue are higher than
the ones recorded in the previous year and continue to be highly favourable: 30.0%, 36.9%
and 46.0% (as compared to 29.5%, 35.2% and 54.7% in 2015), confirming the high
profitability of the company.
Net profit per share of RON 2.66 recorded in 2016 shall be positively influenced by the
allocation from the reserves made in previous years in compliance with GD No 168/1998.
The reserves allocation, with a positive impact on the net profit to be allocated, was in 2013 in
amount of RON 157.5 million, in 2014 RON 241.90 million, and in 2015 in amount of RON
214.0 million. In 2016, the amount to be allocated from reserves is of RON 405.45 million.
Romgaz is a company with considerable contributions to the state budget: approximately
46% of the total income is distributed to the state as taxes, fees, contributions and dividends.
Investments play an important part in arresting the production decline, which is achieved
through the discovery of new reserves, the improvement of the current recovery rate, and the
rehabilitation, development and modernization of existing facilities.
For 2016, Romgaz scheduled investments worth RON 1,020 million and invested RON 497.7
million, less than 51.2%. The 2016 investments were lower than the 2015 ones (RON 937.9
million), due to fewer planned investments in surface exploration, decrease of investments in
joint ventures and works postponed as a result of difficulties in preparatory activities
(obtaining of land, endorsements, agreements, authorizations), and amendments to the public
procurement law. The investments were financed exclusively from own sources.
The value of fixed assets commissioned during the reporting period was RON 581.5 million.
During 2013-2016, the Company made investments worth approx. RON 3.37 billion, as
follows:
Year
2013
2014
2015
2016
Total
Value
(RON thousand)
848,247
1,085.497
937,916
497,716
3,369,376
A summary of investments is shown in the table below:
Page 11 of 98
Board of Director’s Report 2016
Item
No
Investment chapter
2015
*RON thousand*
%
2016
0
1.
1.1 Natural gas exploration, production works
Investment in progress – total, including:
1
2
352,467
319,051
Planned
3
327,899
252,819
Achieved
4
238,433
178,285
’16/’15
5=4/2x100
72.71
55.88
1.2 Maintaining the UGS capacity
32,374
75,000
59,953
185.19
1.3 Environment protection works
2. New investments – total, out of which:
2.1 Natural gas exploration, production works
2.2 Maintaining the UGS capacity
2.3 Environment protection works
3.
4. Equipment (other acquisition of tangible
Investment in existing tangible assets
assets)
5. Other investment (studies, licenses, software,
financial assets etc.)
1,042
297,039
292,440
112
4,487
224,664
54,080
80
325,201
305,237
15,000
4,964
245,441
88,897
195
21,316
18.71
7.18
19,995
6.84
1,287 1,149.11
0.76
89.46
58.87
34
200,983
31,838
9,666
32,562
5,146
53.24
*
TOTAL
937,916
1,020,000
497,716
53.07
Since November 12, 2013, the company’s shares have been traded on the regulated market
governed by BVB (Bucharest Stock Exchange) under the “SNG” symbol, and the GDRs on
the regulated market governed by LSE (London Stock Exchange) under the “SNGR” symbol.
Performance of Romgaz shares compared to the evolution of BET index (Bucharest Exchange
Trading) from listing to December 31, 2016 is shown below:
40.00
35.00
30.00
25.00
20.00
15.00
10.00
5.00
0.00
e
r
a
h
s
/
N
O
R
3
1
0
2
/
2
1
/
1
1
3
1
0
2
/
4
/
2
1
4
1
0
2
1
0
.
.
3
0
4
1
0
2
1
0
.
.
7
2
4
1
0
2
2
0
.
.
8
1
4
1
0
2
3
0
.
.
2
1
4
1
0
2
/
3
/
4
4
1
0
2
/
0
3
/
4
4
1
0
2
5
0
.
.
7
2
4
1
0
2
6
0
.
.
9
1
4
1
0
2
7
0
.
.
1
1
4
1
0
2
8
0
.
.
4
0
4
1
0
2
/
8
2
/
8
4
1
0
2
9
0
.
.
2
2
4
1
0
2
0
1
.
.
4
1
4
1
0
2
1
1
.
.
5
0
4
1
0
2
1
1
.
.
7
2
4
1
0
2
2
1
.
.
2
2
5
1
0
2
/
1
2
/
1
5
1
0
2
/
2
1
/
2
5
1
0
2
/
6
/
3
5
1
0
2
/
0
3
/
3
5
1
0
2
/
4
2
/
4
5
1
0
2
/
0
2
/
5
5
1
0
2
/
5
1
/
6
5
1
0
2
/
7
/
7
5
1
0
2
/
9
2
/
7
5
1
0
2
/
0
2
/
8
5
1
0
2
/
4
1
/
9
5
1
0
2
/
6
/
0
1
5
1
0
2
/
8
2
/
0
1
5
1
0
2
/
9
1
/
1
1
5
1
0
2
/
5
1
/
2
1
6
1
0
2
/
3
1
/
1
6
1
0
2
/
4
/
2
6
1
0
2
/
6
2
/
2
6
1
0
2
/
1
2
/
3
6
1
0
2
/
2
1
/
4
6
1
0
2
/
5
/
5
6
1
0
2
/
7
2
/
5
6
1
0
2
/
1
2
/
6
6
1
0
2
/
3
1
/
7
6
1
0
2
/
4
/
8
6
1
0
2
/
9
2
/
8
6
1
0
2
/
0
2
/
9
6
1
0
2
/
2
1
/
0
1
6
1
0
2
/
3
/
1
1
6
1
0
2
/
5
2
/
1
1
6
1
0
2
/
1
2
/
2
1
SNG
BET
9000.00
8000.00
7000.00
6000.00
5000.00
4000.00
3000.00
2000.00
1000.00
0.00
Page 12 of 98
Board of Director’s Report 2016
January 27, 2016
Government Ordinance No.11 on amending and supplementing Government Ordinance No
26/2013 on strengthening financial discipline at the level of economic operators where the
state or administrative-territorial units are sole or majority shareholders or hold directly or
indirectly a majority participation. The most important modification, impacting Romgaz’
activity, refers to the income and expenditure budget of the Company, that no longer needs
Government approval prior to the approval of the Company’s shareholders.
February 22, 2016
Mrs. Baciu Sorana resigned from the Board of Directors, and Mr. Tcaciuc Sebastian-Gabriel
was appointed as interim member on the vacant position as of February 23, 2016.
March 23, 2016
ANRE issued the Order No 9/2016 on extending the application period of the Order of ANRE
President No.58/2015 on establishing the regulated tariff for the supply of UGS services by
Societatea Nationala de Gaze Naturale “Romgaz” S.A. Medias.
March 25, 2016
Pursuant to the Resolution No 2 of the Ordinary General Meeting of Shareholders as of March
18, 2015, the mandate of Mr. Dorcioman Dragos terminated.
By Resolution No 3 of the Ordinary General Meeting of Shareholders Mr. Jude Aristotel-
Marius was appointed as member of the Board on the position left vacant by mandate
termination of Mr. Dorcioman Dragos. Mr. Tcaciuc Sebastian-Gabriel was appointed as
member of the Board under the same Resolution.
May 27, 2016
Law No 111/2016 on approving Government Emergency Ordinance no.109/2011 on the
corporate governance of public enterprises, amending significantly also the Ordinance it
approves.
June 16, 2016
By Resolution No 5/2016 of the Ordinary General Meeting of Shareholders the Company’s
2016 Income and Expenditure Budget was approved.
June 23, 2016
Board’s Resolution No 14/2016 on developing and operating CTE Iernut without concluding
an association in participation contract and financing the investment from own sources and
from NIP funds.
June 28, 2016
Government Decision No 461/2016 on modifying the Annex to Government Decision No
488/2015 on establishing the purchase price of domestic gas for household customers and
producers of thermal energy in cogeneration plants and thermal plants intended for
household consumption, by which the Government of Romania approved to maintain the
domestic production price to 60.00 RON/MWh for the period 1 July 2016 - 31 March 2017.
According to GD No 488/July 1, 2015 on establishing the purchase price of domestic gas for
household customers and producers of thermal energy for those quantities of gas produced in
cogeneration plants and thermal plants intended for household consumption the price should
have increased to 66.00 RON/MWh in the period 1 July 2015 – 30 June 2021.
Page 13 of 98
Board of Director’s Report 2016
September 28, 2016
Government Decision No 722/2016 on approving the Enforcement Guidelines for certain
provisions of the Emergency Ordinance No 109/2011 on corporate governance of public
enterprises, which approved the enforcement guidelines on establishing the selection criteria,
setting up the short list of up to five candidates for each position, their ranking, the procedure
on final appointments, and the enforcement guidelines on establishing the financial and non-
financial performance indicators and the variable component of the remuneration of the board
members or, as the case may be, supervisory bodies of public enterprises, as well as of
managers and the members of directorate, respectively.
October 31, 2016
Romgaz signed with the partnership between Duro Felguera SA and SC Romelectro SA the
Work Contract No133384 with the scope of “Developing Iernut Thermal Power Plant by
Building a New Combined-Cycle Power Plant (CCGT)”.
November 15, 2016
By Resolution no. 10 of the Ordinary General Meeting of Shareholders, as a result of
exercising the cumulative voting procedure Mr. Buzatu Florin Danut and Mr. Stoicescu Florin
Razvan were elected directors.
Also, by means of the same resolution Mr. Virgil Marius Metea and Mrs. Ecaterina Popescu
were revoked as directors as a result of exercising the cumulative voting procedure which did
not reconfirm them as directors.
December 6, 2016
Romgaz filed an application to the Ministry of Energy for financing the investment
“Developing of the Iernut Thermal Power Plant by Building a New Combined-Cycle Power
Plant (CCGT)ˮ, requesting a grant of 25% of the project eligible costs.
Page 14 of 98
Board of Director’s Report 2016
Name: Societatea Nationala de Gaze Naturale “ROMGAZ” SA
Main scope of activity: natural gas production and UGS
Address: Medias, 4 Constantin I. Motas Square, 551130, Sibiu County
Sole registration number: 14056826
Trade Registry registration number: J32/392/2001
Fiscal registration number: RO14056826
Legal form of establishment: joint-stock company
Subscribed and paid in share capital: RON 385,422,400
Number of shares: 385,422,400 each having a nominal value of RON 1
Regulated market where the company’s shares are traded: Bucharest Stock Exchange
(shares) and London Stock Exchange (GDRs)
0040 269 201020
Phone:
0040 269 846901
Fax:
www.romgaz.ro
Web:
E-mail: secretariat@romgaz.ro
Bank accounts opened at: Banca Comerciala Romana, BRD-Groupe Societe Generale,
Citibank Europe, Nextebank, Unicredit Tiriac Bank, Raiffeisen Bank, Banca Transilvania,
ING Bank, Eximbank, CEC Bank.
Shareholder Structure
As of December 31, 2016 the shareholder structure is:
The Romanian State2
Free float – total, including:
*legal persons
*natural persons
Total
FREE
FLOAT
30%
Number of
shares
Number of shares
269,823,080
115,599,320
95,451,082
20,148,238
385,422,400
%
%
70.0071
29.9929
24.7653
5.2276
100.0000
The
Romanian
State
70%
2 The Romanian State through the Ministry of Energy
Page 15 of 98
Board of Director’s Report 2016
On April 21, 2016, SC Fondul Proprietatea SA sold all its Romgaz shares through private
placement, representing 5.85% of the share capital.
During the financial year 2016, the Company did not perform transactions with own shares,
and as of December 31, 2016 did not hold own shares.
Romgaz organization structure is a hierarchy-functional type, with a number of six hierarchy
levels, from company’s shareholders to execution personnel, as follows:
General Meeting of Shareholders
Board of Directors
Director General
Deputy Directors General
Heads of functional and operational compartments subordinated to the Director
General and to the Deputy Directors General
Execution Personnel
The responsibilities of the Board of Directors are detailed in the Company’s Articles of
Incorporation and as well in its Rules of Organization and Operation.
Key people in the structure and for the functionality of the company are the Director General,
the Deputy Directors General, Economic Director, as well as the branches’ directors. The
heads of compartments (branches/departments/directions/offices etc.) representing the
connection between the upper structure and the employees of the respective compartment are
directly subordinated to the afore-mentioned.
Each compartment has its own well-defined attributions in the company’s Organization and
Operating Regulation and all these elements work as a whole.
The tasks, competencies and responsibilities of the execution personnel are included in the job
descriptions related to each position.
The company has 7 branches set up based on the specific of the activities performed and on
the region (natural gas production branches) as follows:
Sucursala Medias (Medias Branch) having its office in Medias, 5 Garii Street, postal
code 551025, Sibiu County, territorially organized in 8 sections;
Sucursala Targu Mures (Targu Mures Branch) having its office in Tirgu Mures, 23
Salcamilor Street, postal code 540202, Mures county, territorially organized in 8
sections;
Sucursala Ploiesti (Ploiesti Branch) having its office in Ploiesti, 184 G. Cantacuzino
Street, 100492, Prahova County, territorially organized in 2 sections and 2 workshops;
Sucursala de Interventii, Reparatii Capitale si Operatii Speciale la Sonde Medias
(SIRCOSS – Branch for Well Workover, Recompletions and Special Well Operations)
having its office in Medias, 5 Soseaua Sibiului Street, 551009, Sibiu County,
territorially organized in 3 sections and 5 workshops;
Sucursala de Transport Tehnologic si Mentenanta Targu Mures (STTM –
Technological Transport and Maintenance Branch) having its office in Targu Mures, 6
Barajului Street, 540101, Mures County, territorially organized in 3 sections and 3
workshops;
Page 16 of 98
Board of Director’s Report 2016
Sucursala de Productie Energie Electrica Iernut (SPEE – Iernut Power Generation
Branch) having its office in Iernut, 1 Energeticii Street, 545100, Mures County;
Sucursala Bratislava (Bratislava Branch) having its office in Bratislava, City Business
Centre V.-Karadžičova 16, code 82108, Slovakia.
As of December 31, 2016 the company has a subsidiary “S.N.G.N. ROMGAZ S.A. – Filiala
de Înmagazinare Subterană a Gazelor Naturale DEPOGAZ Ploieşti S.R.L.”, with its
headquarters in Ploiesti, having as scope of activity the natural gas underground storage. The
subsidiary has been set up in order to comply with Directive 2009/73/CE of the European
Parliament and of the Council of July 13, 2009 on common rules for the internal market in
natural gas and repealing Directive 2003/55/EC, as well as with the Natural Gas and
Electricity Law no. 123/2012.
Societatea Nationala de Gaze Naturale “ROMGAZ” SA is a company which targets
performance and is determined to generate performance by best employment of energies to
meet its objectives.
Performance, competition and continuous growth of the company’s value both for us and for
the shareholders by means of a better valuation of the human potential and assets, by
predictable and profitable business deals and a better risk management.
ROMGAZ has the potential and the ambition to consolidate and to develop its position as the
most important natural gas company in Romania and to become a leading player on important
Central and Eastern European markets by means of an efficient and competitive production
able to face the increasing pressure exercised by regional and international companies.
Page 17 of 98
Board of Director’s Report 2016
Increasing
the
company's
value for its
shareholder
s
Care for the
environmen
t
Quality
products
and services
Efficiency
ROMGAZ
Safety for
the
employees
Social
responsibilit
y
Transparency
Sustainable
development
In order to meet its main scope of activity through an efficient use of material, financial,
informational and human resources, the company set the following
:
Page 18 of 98
Board of Director’s Report 2016
Increase of the gas resources and reserves portfolio through the discovery of new
resources and the improvement of the recovery rate of already discovered resources
Position consolidation on the energy supply markets
Optimization, development and diversification of the UGS activity by reconsidering its
importance in terms of safety, continuity and flexibility of the natural gas supply
Increasing the company's performance
Identification of new growth and diversification opportunities
Improving the organization structure of the company
Reorganization of the internal audit function
Page 19 of 98
Board of Director’s Report 2016
The company undertakes business in the following segments:
natural gas exploration and production;
UGS activity;
natural gas supply;
special well operations and services;
maintenance and transportation services;
power generation and supply;
natural gas distribution.
Romgaz is titleholder or co-titleholder, in Romania, of the following petroleum agreements:
petroleum operations for exploration-development-production in 9 blocks with 100%
participating interest and in 4 blocks as co-titleholder, under certain concession
agreements;
141 commercial fields;
5 fields recording experimental production;
exploration and production rights in Slovakia and Poland.
Exploration
Since October 1997, the exploration activity has been carried out in 8 blocks in Transylvania,
Moldova, Muntenia, and Oltenia, in accordance with the Concession Agreement approved by
Government Decision No 23/2000. Fourteen exploration wells were completed in 2016, with
the following results:
2 discoveries with a prospective geological resource (P50) of 27.0 billion m3;
confirmation of hydrocarbon accumulations with a contingent resource (2C) evaluated
at approx. 2.7 billion m3.
Romgaz designs and plans all exploration works based on its own concepts by using modern
specialized software, evaluations of the geological area’s prospectivity displaying specific
features within the blocks under concession, and these are carried out by specific surface
exploration methods for the identification of the areas with hydrocarbon accumulations
(prospects), followed by exploration drilling to prove the presence of accumulations.
The results materialised in reserve replacement ratios, with a highest value of 323% reached
in 2012.
Page 20 of 98
Board of Director’s Report 2016
The table below shows the evolution of the reserves replacement ratio during 2009-2016:
323
155
92
49
94
82
70
104
2009
2010
2011
2012
2013
2014
2015
2016
%
350
300
250
200
150
100
50
0
Production
The 2016 annual program for petroleum operations considered the
dynamics of gas demand, reactivation, recompletion and well
work over operations, bringing in production wells resulted from
exploration activities and production wells, maintenance programs
of compressor stations and of dehydration stations, commissioning
of new compressor units and the dynamics of import gas flows
injected into/withdrawn from UGS.
The company’s gas production was lower than the 2015 production (4.219 million m3 vs
5.563 million m3). According to ANRE data, this production ensured Romgaz a 42.5% market
share of deliveries in the gas consumption from internal production and a 41.46% market
share among the gas producers.
The production in amount of 4,219 million m3 was about 7.6% lower than the planned one,
due to:
A mild winter at the beginning of 2016;
Drastic decrease of gas demand in the chemical industry;
Decrease of gas demand for building up the minimal gas stock for the 2016-2017
winter due to an imprecise and incoherent regulatory framework;
Increased competition from gas importers induced by the steep decline of gas price in
Europe.
Page 21 of 98
Board of Director’s Report 2016
Currently, in Romania there are 8 UGSs constructed in
depleted gas reservoirs out of which 7 are in operation.
Romgaz owns and operates 6 UGSs having a total capacity
of 4.335 billion m3 and a working gas volume of 2.920
billion m3.
At national level, the ratio between the working gas volume and the annual consumption was
about 27% in 2016. This level is in the first upper half of 2015 international values (Great
Britain 6.4%, Spain 9.8%, Holland 40.6%, Poland 19.9%, Italy 26.2%, Germany 29.8%,
France 29.5%, Denmark 33.6%, and Hungary 69.6%).
The UGS activity is a business segment regulated by ANRE (National Authority for Energy
Regulation) with regard to UGS operators’ licensing and the access to the UGSs, as well as
setting the tariffs related to UGS activity.
After a thorough restructuring, the natural gas sector is currently
split into independent activities. The Romanian natural gas
market includes a NTS operator (Transgaz), producers (Romgaz
and Petrom have a 97% market share), UGS operators, companies
for the distribution and supply of gas to captive customers, and
suppliers on the wholesale market.
The natural gas market in Romania consists of the competition segment, which includes gas
trading activities between suppliers and between suppliers and eligible consumers, and the
regulated segment, which includes monopoly-like activities performed in accordance with
framework contracts (transmission, underground storage, distribution and supply at a
regulated price).
As of July 1, 2007 the gas market is fully open for all consumers. They may freely choose a
gas supplier from the ones licensed by ANRE and directly negotiate the gas supply terms and
price. The consumer may directly exercise its quality as eligible consumer without an
obligation to carry out any kind of administrative procedure.
Law no. 123/2012 sets the legal framework to converge the domestic gas price to the import
gas price. Government Decision no.22/January 22, 2013, as amended by Government
Decision no. 511/June 26, 2014 and Government Decision no. 816/September 22, 2014, set
calendars for the increase of the acquisition price of domestic gas for the regulated market.
During Q3 (Government Decision no. 511/2014) and Q4 (Government Decision no.
816/2014) the domestic gas price was the same price as in Q2 (Government Decision no.
22/2013) for non-household customers. For household customers, CPT, the Q3 2014 price
increases as compared to Q2 2014 in accordance with GD No 511/2014, and such price
remained valid for Q4, too (GD No.816/2014).
Until the convergence of prices is reached and to ensure equal access of all consumers to
cheap natural gas sources from the domestic production, the supply of gas to the consumers is
carried out according to ANRE Order no. 15/2013 as an import/domestic gas mixture
established monthly according to the different consumer categories (households and
producers of thermal power for the consumption of population and non-households).
Page 22 of 98
Board of Director’s Report 2016
In terms of supply, Romgaz held during 2009-2016 a national market share ranging between
37 and 46%:
National consumption
traded
Romgaz
volumes (domestic +
import)
Romgaz market share
M.U.
2009
2010
2011
2012
2013
2014
2015
2016
bcm
bcm
13.3
6.1
14.0
6.4
14.4
6.3
13.5
5.9
12.5
5.7
12.2
5.7
11.6
5.1
11.8
4.4
%
45.86 45.81 43.87 42.82
44.5
46.1
44.0
37.1
The above quantities include gas from own domestic production, domestic gas purchased
from third parties, 100% gas from Schlumberger joint venture and import gas. As compared
to previous years, 2016 deliveries include gas delivered to Iernut and Cojocna for electricity
production.
SIRCOSS was established in 2003 in accordance with the GSM Resolution No.5/June 13,
2003.
The branch performs two types of activities:
well workover, recompletion operations and production tests;
special well operations.
All well workover, recompletion operations and production tests operations are performed by
means of rig installations.
The second activity consists of special well operations, namely services supplied by means of
different transportable equipment for downhole or surface operations.
During the past years most of services were supplied for the wells within the company’s
portfolio, yet, well workover and special well operations were also supplied to other
companies in Romania that have under concession and operate gas wells in Romania.
STTM was established in October 2003, by taking over the means of transportation from Medias,
Targu-Mures and Ploiesti branches.
The branch’s scope of activity is the transportation of goods and people, the specific
technological transportation, and the maintenance activity for the benefit of the company and
of third parties.
CTE Iernut is an important junction point in the National Power Grid located in the centre of
the country, in Mures County on the left bank of Mures River between towns Iernut and Cuci.
Gas supply, industrial water and power discharge facilities are forthcoming.
CTE Iernut is operated under Romgaz Electricity Generation Branch (SPEE).
CTE Iernut has an installed capacity of 600 MW split into 4 energy groups: two 100 MW
energy units of Czechoslovakian manufacturing and two 200 MW energy units of Soviet
manufacturing. The groups were commissioned between 1963 and 1967. As of January 1,
2016, the energy units 2 and 3 were put into a dry storage condition.
Page 23 of 98
Board of Director’s Report 2016
Cojocna Project is an outcome of the pressing need of finding ways to experimentally
produce from a series of wells resulted from exploratory drilling, in order to determine, as
detailed as possible, the production potential of the respective area. The wells were located far
from each other and also from the National Transmission System (NTS).
Thus, during 2009-2010 solutions were sought, feasibility and opportunity studies were
prepared, and further to their approval it was decided to use the gas from wells 2 and 4
Cojocna as fuel gas for two 1.5 MW power generation units, bearing in mind that the
connection to the National Energy System (NES) didn’t raise any major issue.
This power generation pilot project using units that do not require special installations works
is an alternate option for gas production and valorisation from isolated wells that would imply
building kilometre long gathering pipes, thus, representing a not justifiable option due to the
high costs and multiple impediments related to access on outside build-over areas belonging
to legal or individual persons.
Commissioning the two electricity production units using the gas from wells 2 and 4 Cojocna
was a technological success but unfortunately a short termed one, because of reduced gas
flows that led to intermittent operation of wells and units.
Our specialists focused during year 2015 both on productivity stimulation from both wells (re-
perforation of productive layers, addition of new pay zones) and on setting the best layout of
gathering pipes where other isolated wells may deliver, ensuring thereby the necessary gas
volumes for both units.
Further to approving a feasibility study, it has been decided to implement the scenario on
building a pipeline network to collect gas from the neighbouring wells and transmission of
gas to the two power generation units (in progress).
In 2016, the documentation prepared in accordance with Law No 50 as of June 29, 1991
regarding authorization of construction work performance was filed at the Cluj County
Council, regarding the work: „Pipelines and Technological Installations related to Putting
wells 1 Palatca, 1 Vaida and 2 Vaida on Experimental Production”.
The natural gas distribution is a regulated business segment and the company’s activity is
currently limited to Ghercesti and Piscu Stejari areas. Romgaz has concession agreements
with the Ministry of Economy for Ghercesti area and with Piscu Stejari Town Hall for Piscu
Stejari distribution. The activity is carried out by Targu-Mures Branch.
Societatea Nationala de Gaze Naturale “ROMGAZ” SA is
Romania’s most important natural gas producer and
supplier. The company’s experience in the field of gas
exploration and production exceeds 100 years. Its history
began in 1909 when the first natural gas commercial
reservoir was discovered in the Transylvanian Basin upon
the drilling of well Sarmasel-2.
Page 24 of 98
Board of Director’s Report 2016
The most important historic benchmarks are:
•Natural gas discovery in Sarmasel (Transylvanian Basin)
•First gas production recorded in Romania (113,000 m3)
•Establishment of the National Gas Company "SONAMETAN"
•First UGS in Romania constructed in Ilimbav, Sibiu County
•Use of compressors in the course of production
•Maximum gas production obtained by Romgaz (29,834 million m3)
•The natural gas import from the Russian Federation begins
•Centrala Gazului Metan was reorganized to Regia Autonoma "ROMGAZ" RA
•"ROMGAZ" RA became Societatea Nationala de Gaze Naturale "ROMGAZ" SA
•SNGN "ROMGAZ" SA was reorganized into five independent companies (SC
"Exprogaz" SA Medias, SNDSGN "Depogaz" SA Ploiesti, SNTGN "Transgaz" SA
Medias, SC "Distrigaz Sud" SA Bucuresti SC "Distrigaz Nord" SA Tirgu-Mures)
• The current SNGN "ROMGAZ" SA Medias was established
1909
1913
1925
1958
1972
1976
1979
1991
1998
2000
2001
Page 25 of 98
Board of Director’s Report 2016
In compliance with European and national applicable laws, Romgaz has to legally unbundle
the gas storage activity from gas production and supply activities.
Further to adopting Directive 2009/73/CE of the European Parliament and Council on July 13,
2009 concerning common rules of the internal market in natural gas and repealing Directive
2003/55/CE, the Romanian Parliament adopted the Energy and Gas Law no. 123/2012. This
was published in the Official Gazette of Romania no. 485 on July 16, 2012 and became
effective on July 20, 2012.
According to the provisions of article 141, paragraph 1 of the Law (which transcribes article
15, paragraph 1 of the Directive) a storage operator under a vertically integrated economic
operator must be independent from other activities not related to transmission, distribution
and underground storage activities at least from legal, organizational and decision-making
perspective.
Therefore, considering the above mentioned matters, it is compulsory to legally separate the
gas storage activity from the gas production and supply activities performed by Romgaz by
establishing a separate company to act as independent storage operator.
Both the Directive and the Law recommend as solution to set up an independent subsidiary
that should act as storage operator, as follows:
Article 15 paragraph 2 let. c) of the Directive provides that: “the storage system
operator shall have effective decision making rights, independent from the integrated
natural gas undertaking, with respect to assets necessary to operate, maintain or
develop the storage facilities. This shall not preclude the existence of appropriate
coordination mechanisms to ensure the economic and management supervision rights
of the parent company in respect of return on assets […]”
Article 141 paragraph 3 let. c) of the Law also provides that: “the storage system
operator shall have effective decision making rights, independent from the parent
company, with respect to assets necessary to operate, maintain or develop the storage
facilities;
the existence of appropriate coordination
mechanisms to ensure the economic and management supervision rights of the parent
company in respect of return on assets owned by a subsidiary”.
this shall not preclude
For fulfilling the legal requirements set by the Directive and by Law, respectively, the
following steps have been taken:
a study has been prepared to identify the best version for performing the legal
unbundling of the storage activity from the gas production and supply activity. The
solution recommended by Ernst&Young was to create an independent subsidiary,
owned 100% by Romgaz to perform gas storage activities;
the Board of Directors, endorsed in Resolution no. 22/30.10.2014 at article 10 the
incorporation, registration an declaration to the Trade Office Register by Prahova
Court the subsidiary “SNGN Romgaz SA – Filiala de Inmagazinare Gaze Naturale
“Depogaz” Ploiesti S.R.L.”;
the Extraordinary General Meeting of Shareholders approved by Resolution no.
10/19.12.2014 (item II) to set up the subsidiary “SNGN Romgaz SA – Filiala de
Inmagazinare Gaze Naturale “Depogaz” Ploiesti S.R.L.”;
Page 26 of 98
Board of Director’s Report 2016
On March 17, 2015, the General Meeting of Shareholders approved the Article of
Incorporation of the subsidiary;
A consultancy agreement on “Assistance in performing the legal unbundling of
UGS activity in accordance with applicable law (Law no. 123/2012 on Energy and
natural gas and European Directive 2009/73/CE)” has been concluded and the
Final Report prepared by the consultancy agency (K.P.M.G.) was submitted to the
National Authority for Energy Regulation;
The Company has submitted a request to the National Agency for Fiscal
Administration for an advanced tax ruling (SFAI);
During the Board of Directors Meeting on August 13, 2015 the fixed assets lease
Agreement to be concluded between SNGN Romgaz SA and subsidiary has been
endorsed.
The following agreements have been concluded between the company and
subsidiary:
a) The Agreement no. 9523 as of September 22, 2015 regarding the lease of
fixed assets
b) The Agreement no. 9525 as of September 22, 2015 regarding services
related to gas compression and gas dehydration and services related to
maintenance of the underground gas storage system;
ANRM issued the Attestation Certificate no. 1691 as of October 1st, 2015
certifying that the subsidiary meets the Attestation Procedure requirements and
agreed that the subsidiary (operator) may perform the petroleum operations in the
blocks where the UGS are located;
By Resolution no. 2588 as of December 30, 2015, ANRE amends the Licence no.
1942/2014 on operation of UGS system by changing the owner from SNGN
ROMGAZ SA Medias into SC SNGN ROMGAZ SA- Filiala de Inmagazinare
Gaze Naturale “Depogaz” Ploiesti S.R.L, and shall be valid as of April 1st, 2016;
the executive management will urgently initiate the procedure for selecting the
subsidiary’s administrators. This procedure must comply with the independence
criterion stipulated in Directive 2009/73/CE and implemented in Electricity and
Natural Gas Law no. 123/2012, as amended and supplemented, and will consult
the competent institutions/authorities so that the new company obtains the
endorsements/approvals necessary for performing the activities included in the
main activity.
By Decision No 446 as of March 23, 2016, ANRE postponed until April 1, 2017
the entering into force of the Decision No 2588 as of December 30, 2015 on
modifying the License No 1942/2014 on operating the UGS system, in terms of
changing the titleholder of such, namely from SNGN ROMGAZ S.A Mediaș to
SC SNGN ROMGAZ S.A. - Filiala de Inmagazinare Subterana a Gazelor Naturale
DEPOGAZ Ploiesti SRL;
Page 27 of 98
Board of Director’s Report 2016
the National Agency for Fiscal Administration issued the final fiscal anticipated
individual solution A-RFC 1527/September 05, 2016 as regards profit tax and
applicable VAT, for the operations described by Romgaz, with the purpose of
separating the UGS activity from the production activity and the supply activity.
A series of changes to the organizational structure have been performed during 2016:
By Decision No 113 of the Director General as of April 1, 2016 on modifying the
organizational structure of SNGN ROMGAZ S.A., following changes were made:
o Grouping the HSEQ specific activities under a direction - the Quality, Health,
Security, Environment Direction - subordinated to the director general, which
groups the activities of prevention and protection, emergency situations,
security structure, environmental protection, in accordance with the good
practices employed in companies similar to Romgaz;
o Subordinating the Human Resource Direction to the Director General;
o Bringing together certain support activities under one direction - the
Management Support Direction - subordinated to the Director General, such as
corporate governance, technical regulations and authorizations, legal, public
relations and communication, counsellors;
o Setting up the Controlling and Risk Analysis Office under the Budget and
Economic Analysis Service, subordinated to the Head of Service;
By the Decision of the Director General No 90/March 4, 2016 and No 91/April 4,
2016 –Medias Branch project units responsible for “Reservoir Rehabilitation
Projects” were set up with the aim of ensuring implementation of projects for the
rehabilitation of mature gas reservoirs within the two branches.
No mergers of the company took place in financial year 2016.
Page 28 of 98
Board of Director’s Report 2016
The Company’s revenues are generated mainly from gas production and delivery (own gas
production and delivery, gas produced by joint ventures, import gas deliveries and gas
deliveries from other domestic producers), from supply of underground gas storage services,
from production and supply of electric energy and from other specific services.
Description
2015
2016
Item
No
0
1
2
3
1
Total Income, out of which:
*operating income
*financial income
Revenue
Expenses, out of which:
*operating expenses
*financial expenses
4 Gross Profit
5
6
Income Tax
Net Profit
2
4,315,926
4,271,610
44,316
4,052,684
2,847,088
2,817,525
29,563
1,468,838
274,553
1,194,285
3
3,816,770
3,794,123
22,647
3,411,868
2,536,075
2,516,978
19,097
1,280,695
256,116
1,024,579
* RON thousand *
Ratio
(2016/2015)
4=3/2x100
88.43%
88.82%
51.10%
84.19%
89.08%
89.33%
64.60%
87.19%
93.28%
85.79%
The Total Income was lower than the 2015 income by 11.57%.
Below are the compared economic-financial indicators for 2015 and 2016 and their detailed
structure split by activity:
Compared economic-financial indicators
* RON thousand *
Description
2015
2016
1
Revenue
Cost of commodities sold
Investment Income
Other gains and losses
Changes in inventories
Raw materials and
consumables
Depreciation, amortization
and impairment
Employee benefit expense
Interest and expenses with
decommissioning
provision
Exploration Expenses
Other Expenses
2
4,052,684
- 40,228
44,185
3
3,411,868
- 49,878
22,117
Indices
(2016/2015)
4=3/2x100
84.19%
123.99%
50.06%
- 318,903
- 468,218
146.82%
138,181
- 78,262
20,963
- 54,632
15.17%
69.81%
- 793,598
- 311,012
39.19%
- 511,647
- 20,302
- 498,114
- 18,275
97.36%
90.02%
- 42,95
- 253,348
595.59%
-1,040,670
- 881,923
84.75%
Page 29 of 98
Board of Director’s Report 2016
Other Income
Profit before tax
Income tax expense
Profit for the year
79,793
1,468,838
- 274,553
1,194,285
361,147
452.60%
1,280,695
- 256,116
1,024,579
87.19%
93.28%
85.79%
Structure of indicators split by activity-2016
Description
TOTAL
2016,
1
Revenue
including:
2
4,052,684
Gas
production
and
deliveries
3
3,511,385
Undergroun
d Gas
Storage
Electrici
ty
* RON thousand *
Settlemen
Other
t between
activities
segments
4
332,639
5
443,164
6
254,667
7
- 489,171
Cost of commodities sold
- 40,228
- 16,733
- 29
- 22,706
Investment Income
44,185
1,681
Other gains and losses
- 318,903
- 310,017
5,593
- 1,368
21,832
1
- 471
182
- 759
36,910
- 7,047
3,422
138,181
- 78,262
112,745
- 53,917
- 12,345
- 1,692
- 14,553
4,245
Changes in inventories
Raw materials and
consumables
Depreciation,
amortization and
impairment
Employee benefit
expense
Interest and expenses
with decommissioning
provision
Exploration Expenses
- 793,598
- 673,420
- 88,262
- 4,790
- 27,126
- 511,647
- 316,177
- 47,335
- 33,085
- 115,050
- 20,302
- 18,642
- 1,660
- 42,395
- 42,395
Other Expenses
-1,040,670
-1,075,831
- 95,265
Other Income
79,793
76,855
2,884
-
275,662
111
Profit before tax
1,468,838
1,195,534
116,684
105,051
Income tax expense
- 274,553
- 80,594
486,682
- 1,756
1,700
51,569
- 274,553
Profit for the year
1,194,285
1,195,534
116,684
105,051
- 222,984
Description
Structure of indicators split by activity-2016
Gas
production
and
deliveries
3
2016,
including:
TOTAL
2
1
* RON thousand *
Underground
gas
storage
Electrici
ty
Other
activities
Settlement
between
segments
4
5
6
7
Revenue
Cost of commodities sold
Investment income
Other gains and losses
Changes in inventories
Raw materials and
consumables
Depreciation, amortization
and impairment
Employee benefit expense
3,411,868
2,857,683
358,568
399,042
239,230
- 442,655
- 49,878
22,117
- 18,443
844
- 468,218
- 445,340
20,963
2,765
- 432
- 30,229
- 774
3,949
- 1,915
13,522
40
17,284
- 445
- 20,518
233
4,443
-
-
-
-
- 54,632
- 37,389
- 7,142
- 1,460
- 10,660
2,019
- 311,012
- 498,114
- 185,959
- 313,449
- 95,784
- 6,940
- 22,329
- 47,163
- 30,028
- 107,474
-
-
Page 30 of 98
Board of Director’s Report 2016
Finance cost
Exploration expense
Other expenses
Other income
Profit before tax
Income tax expense
Profit for the year
- 18,275
- 16,674
- 1,601
- 253,348
- 253,348
-
-
-
-
-
-
-
- 881,923
- 915,298
- 91,057
- 256,113
- 61,076
441,621
361,147
356,420
2,223
122
3,367
- 985
1,280,695
1,031,812
133,168
74,222
41,493
- 256,116
-
-
-
- 256.116
1,024,579
1,031,812
133,168
74,222
- 214,623
-
-
-
The table below compares the 2016 revenue with the 2015 revenue, for each activity (RON
thousand):
Description
1
Revenue, including:
gas production and deliveries activity, including:
* sale of own domestic gas – third parties
* sale of own domestic gas-settlements between branches
* sale of own domestic gas produced by joint ventures
* sale of import gas
* sale of domestic gas from acquisitions
* distribution services
* other revenues from production- third parties
underground gas storage activity-total, including:
* third parties
* settlements between branches
Electricity generation – total, including:
* third parties
* settlements between branches
Other activities – total, including:
* third parties
* settlements between branches
settlements between branches – total
2015
2016
Ratio
2
3
4,052,684
3,411,868
3,511,385
2,857,683
3,159,884
2,558,848
157,064
136,481
131,373
108,323
4,169
14,545
192
10,885
9,332
384
44,158
33,430
332,639
358,568
332,639
346,141
-
443,164
356,620
86,544
12,427
399,042
336,430
62,612
254,667
239,230
9,104
8,095
245,563
- 489,171
231,135
- 442,655
(2016/2015)
4=3/2x100
84.19%
81.38%
80.98%
86.90%
82.45%
261.09%
64.16%
200.00%
75.71%
107.79%
104.06%
-
90.04%
94.34%
72.35%
93.94%
88.91%
94.12%
90.49%
The table below shows the revenue weight in different business segments:
Description
and
delivery
production
Gas
activity
UGS activity
Electricity generation and delivery
activity
2014
RON mil % R
2015
RON mil % R
2016
RON mil % R
3,853.0
85.75
3,511.4
86.64
2,857.7
83.76
425.8
424.1
9.48
9.44
332.6
443.2
8.21
10.94
346.1
336.4
10.14
9.86
Page 31 of 98
Board of Director’s Report 2016
Other activities
Settlement between branches
TOTAL Revenue (R)
324.7
317.7
4,493.3
7.22
-11.89
100.00
254.7
-489.2
4,052.7
6.28
-12.07
100.00
314.3
-442.7
3,411.9
9.21
-12.97
100.00
Revenue was lower by 15.81% than the revenue of the previous year.
The 2015 and 2016 revenue structure is shown in the figures below:
2015
1.3%
0.1% 8.8%
8.2%
0.3%
9.9%
2016
0.9%
10.5%
81.6%
Internal gas production and delivery
UGS services
Natural Gas Import
Electric Energy
Other activities
78.5%
Internal gas production and delivery
UGS services
Natural Gas Import
Electric Energy
Other activities
The financial income is lower by 48.90% than the one recorded in the previous year. Financial
income consists mainly of interests on bank deposits and of interest on state bonds. In 2016,
this income decreased because of a reduction of interest rates.
Description
Year 2015
Year 2016
Ratio
1
Operating expenses
Financial expenses
Total expenses
(RON thousand)
2
(RON thousand)
3
2,817,525
29,563
2,847,088
2,516,978
19,097
2,536,075
(2016/2015)
4=3/2x100
89.33%
64.60%
89.08%
Expenses incurred during January–December 2016 have been lower by 10.92% than those of
the similar period in the previous year, as a result of the decreasing acquisition costs of
imported natural gas.
Financial Expenses
Financial expenses during 2016 are lower by 35.40% as compared to the previous year due to
the decrease of unwinding costs applied to decommissioning provision for fixed assets.
Chapter 7 shows more details on the different categories and a comparative assessment
thereof.
Page 32 of 98
Board of Director’s Report 2016
Compared financial results are shown in the table below (RON thousand):
Description
2015
2016
1
Operating results
Financial results
Gross result
Income tax
Net Result
2
1,454,085
14,753
1,468,838
-274,553
1,194,285
3
1,277,145
3,550
1,280,695
-256,116
1,024,579
Ratio
(2016/2015)
4=3/2x100
87.83%
24.06%
87.19%
93.28%
85.79%
Gross result during January – December 2016 in amount of RON 1,280,695 thousand is
lower than the gross result of the similar period of 2015 by 12.81%.
The 2016 financial result is below the 2015 one, due to the decrease of financial income.
Income tax calculated for 2016 is lower by 6.72% than in 2015 due to the decrease of
expenses related to current tax and increase of income resulted from deferred tax calculation.
of the company is also emphasized by the evolution of indicators
presented in the table below:
Indicators
1
Working capital (WC)
Working capital requirements (WCR)
Net cash
Economic Rate of Return (ERR
Return on Equity
Return on Sales
Return on Assets
EBIT
EBITDA
ROCE
Asset Solvency
where:
M.U.
2015
2016
Calculation
Formula
2
Clt-Af =
E+Lnc+Pr+Si-Af
(Ast-L+Pp) -
(Lcrt-Crst+Idf)
WC-WCR = L-Crst
Pg/Cltx100
Pn/Ex100
Pg/Rx100
Pn/Ax100
Pg+Exi-Ir
EBIT+Am
EBIT/Cempx100
E/Lx100
3
RON
mil
RON
mil
Ron
thousand
%
%
%
%
RON
thousand
RON
thousand
%
%
4
3,562
5
3,772
2,821
3,492
740
281
14.60
12.32
36.24
11.18
1.425
12.77
10.59
37.54
9.33
1.259
2.218
1.570
14,16
90,71
12,55
88,15
Clt
Af
E
Lnc
Pr
Si
Ast
L
Pp
Lcrt
long-term capital;
non-current assets;
equity;
non-current liabilities;
provisions;
investment subsidies;
short term assets;
liquidity position;
Prepayments;
current liabilities;
Idf
Pg
Pn
R
A
Exi
Ir
Am
Cemp
Acrt
deferred income
gross profit;
net profit;
revenue;
total assets;
interest expense;
interest income
amortization and impairment;
capital employed (total assets–current liabilities);
current assets
Page 33 of 98
Board of Director’s Report 2016
Crst
short-term credit;
L
total liabilities
The regulatory framework for natural gas production, transmission, distribution, supply and
storage, organization and operation of the gas sector, market access as well as criteria and
procedures for granting authorizations and/or licenses in the natural gas sector are set by Law
No. 123/2012, which provides in Chapter XII “Prices and Tariffs”, Article 179 for the
following:
activities in the regulated market comprise the following:
o supply of natural gas to non-household customers at regulated price and under
frame contracts until December 31, 2014. On January 1, 2015 regulated prices for
non-household customers were eliminated.
o supply of natural gas to household customers at regulated price and under frame
contracts until December 31, 2021. To ensure non-discrimination between
customer categories until the end of the regulated period, the household consumers
and the thermal energy producers receive the same treatment in terms of security
of supply and sale price of consumed gas, exclusively for the gas quantities used
for producing thermal energy in cogeneration plants and thermal power plants
intended for household consumption, irrespective of their option to be eligible or
regulated customers ;
o supply of last resort of natural gas;
o natural gas transmission;
o natural gas transmission through upstream supply pipelines, in accordance with the
provisions of license validity conditions;
o underground gas storage;
o natural gas storage in pipelines;
o natural gas, bio-gas and bio-methane distribution;
o related activities performed by licensed operators;
o activities related to LNG terminal operation;
prices and tariffs on the regulated market are set by ANRE, based on methodologies
approved and published by the authority after informing and consulting all parties
concerned;
the calendar for gradual deregulation of prices for the final customers is set by the
Government in compliance with the schedule of producer price progress proposed by
ANRE and ANRM, taking into account possible adverse effects of price deregulation, in
order to mitigate the consequences for customers;
Page 34 of 98
Board of Director’s Report 2016
ANRE will annually monitor the results of the gradual price deregulation calendar and, as
the case may be, submit to the Government the proposal to trade domestic gas production
on the domestic market until fulfilment of the approved calendar, i.e. June 30, 2021.
Romgaz operates both on the regulated market, performing underground gas storage and
distribution activities, and the free market, performing gas production and supply activities.
Underground Gas Storage
The underground gas storage business is included in the regulated segment of the gas market.
The revenues from the underground gas storage business and the storage tariffs are regulated
since April 1, 2004 by ANRGN Decision No. 1078/2003, abrogated by ANRE Order No. 22 of
May 25, 2012 on approval of the Methodology for approval of prices and setting regulated
tariffs in the gas sector, published in the Official Gazette No. 379 of June 6, 2012.
ANRE Order No. 26 of April 26, 2013 approved the regulated revenue for the first year of the
third regulatory period (April 2012 – March 2013), the regulated revenue for the second year
of the regulatory period (April 2013 – March 2014), and the regulated tariffs for the period
April 2013 – March 2014.
ANRE Order No. 29 of April 9, 2014 approved the regulated revenue of the third year of the
regulatory period (April 2014 – March 2015) and the regulated tariffs for the period April
2014 – March 2015.
ANRE Order No. 58 of March 27, 2015 approved the regulated revenue for the fourth year of
the regulatory period (April 2015 – March 2016), and the regulated tariffs for the period April
2015 – March 2016.
Order No. 9 of March 23, 2016 extended the application of Order No. 58/2015 “until the end
of the underground natural gas storage cycle 2016 – 2017”.
Thus, the storage tariffs applied between January 2014 and December 2016 are as follows:
1) Tariffs approved by Order No.26/2013 are as follows:
Tariff Component
M.U.
Volumetric component for gas
injection
Fixed component for capacity
reservation
Volumetric component for gas
withdrawal
Value
2.37
13.12
RON/MWh
RON/MWh/full
storage cycle
RON/MWh
1.80
2) Tariffs approved by Order 29/2014 are as follows:
Tariff Component
Volumetric component for gas
injection
Fixed component for capacity
M.U.
RON/MWh
Value
2.53
RON/MWh/full
13.14
Page 35 of 98
Board of Director’s Report 2016
reservation
Volumetric component for gas
withdrawal
storage cycle
RON/MWh
1.80
3) Tariffs approved by Order 58/2015, extended by Order No. 9/2016 are as follows:
Tariff Component
Volumetric component for gas
injection
Fixed component for capacity
reservation
Volumetric component for gas
withdrawal
M.U.
RON/MWh
RON/MWh/full
storage cycle
RON/MWh
Value
2.37
13.68
1.87
Natural Gas Supply
The final gas price for the customer is the sum of the weighted average gas acquisition price,
the tariffs of transmission, storage and distribution, and the trading component, according to
the following formula:
Final price = Weighted average price of gas acquisition + Transmission tariff + Storage
tariff + Distribution tariff + Trading component
Distribution tariffs depend on the distribution area and on the distribution system operator.
Regulated prices and tariffs are calculated by the “revenue-cap” method for underground
storage and gas transmission and by the “price-cap” method for regulated distribution and
supply.
According to the provisions of Article 181, paragraph (5) of Law No. 123/2012, the domestic
gas acquisition price on the regulated market is set by Government decision, at the proposal
of the competent ministry, and is updated by ANRE and ANRM, in accordance with the
provisions of the Calendar for gradual deregulation of prices for the final customers.
The Romanian authorities agreed with the international financial bodies a calendar for gradual
deregulation of prices until December 31, 2014 for the final non-household customers (except
when on such date there is a significant difference between the trading price of domestic
production and the European import price that may jeopardize the market stability, than the
term would be extended until December 31, 2015); for household customers the term of
completion of the above mentioned process is December 31, 2018. The Romanian
Government signed with IMF, the World Bank and the European Commission a
“Memorandum on the Calendar for Gradual Deregulation of Gas Prices”. This calendar for
price increase until the end of 2014 was approved by Government Decision No. 22 of January
22, 2013 on setting the acquisition price of gas from domestic production on the regulated
gas market.
At the same time, according to Article 124, paragraph (1), letter e) of Law 123/2012, the gas
producer has to make available gas quantities from their own production to suppliers, with
precedence, to cover the regulated market, in accordance with the ANRE regulations on
compliance with the price deregulation calendar, and to secure gas supply to the captive
Page 36 of 98
Board of Director’s Report 2016
consumers, while suppliers have to keep the destination of such gas quantities. The remaining
domestic production, less the gas quantity necessary for technological consumption, shall be
made available to the competitive market.
Domestic gas production allocated to final customers on the regulated market comprises
current gas production and a part of stored gas.
The table below shows the gas supply average prices in the period 2014-2016:
Description
1
Average supply price for internal gas
production3
Average price for import gas
M.U.
2
RON/1000 m3
RON/MWh
RON/1000 m3
RON/MWh
2014
3
687.86
65.48
2015
4
717.80
68.27
2016
5
698.30
66.36
1,436.22
1,928.72
1,597.47
132.24
184.06
105.74
Natural Gas Distribution
Distribution tariffs and final regulated prices valid during the period analysed have been
approved by ANRE Orders, as follows:
ANRE Order No. 103 of June 26, 2008 on setting regulated tariffs for gas distribution
services and approval of prices for regulated gas supply performed by SNGN
ROMGAZ SA, modified by ANRE Order No. 31 of August 30, 2012 (for the period
January 1st –November 30,2014);
ANRE Order no. 120/2014 on setting regulated tariffs for gas distribution services and
approval of prices for regulated gas supply performed by SNGN ROMGAZ SA
Medias, (for the period December 1st 2014-June 30, 2015);
ANRE Order no. 57/2015 on modification of ANRE Order no. 120/2014 on setting
regulated tariffs for gas distribution services and approval of prices for regulated gas
supply performed by SNGN ROMGAZ SA Medias, (starting with July 1st, 2015);
Order No. 58/2016 on setting regulated tariffs for gas distribution service and approval
of prices for regulated gas supply performed by Societatea Nationala de Gaze Naturale
"ROMGAZ" - S.A. Medias (starting with October 1st, 2016).
3 Including gas commodity and gas from association with Schlumberger and without storage services costs
Page 37 of 98
Board of Director’s Report 2016
Tariffs and prices are presented in the table below:
Description
Distribution tariffs (RON/MWh):
*B1 consumption up to 23.25 MWh
*B1 annual consumption between 23.26 and 116.28
MWh
*B1 annual consumption between 116.29 and 1,116.78
MWh
* B1 annual consumption between 1,116.79 and
11,627.78 MWh
Final regulated prices (RON/MWH):
*B1 consumption up to 23.25 MWh
*B1 annual consumption between 23.26 and 116.28
MWh
January
1st –
November
30th, 2014
December
1st, 2014 –
June 30th,
2015
July 1st,
2015 –
September
30th, 2016
October
1st, 2016 -
present
21.66
21.25
44.01
40.06
44.01
40.06
44.01
40.06
52.48
47.71
46.81
45.77
117.8
116.95
120.67
116.03
117.75
113.13
123.27
118.49
On December 31, 2016 the company had 6,246 employees.
The evolution of the company’s number of employees between January 1, 2014 and
December 31, 2016 is shown in the table below:
Description
1
Employees at the beginning of the year
Newly hired employees
Employees who terminated their labour relationship with the
company
2014
2
6,472
92
220
2015
3
6,344
159
147
2016
4
6,356
168
278
Employees at the end of the year
6,344
6,356
6,246
The structure of employees at the end of 2016 was the following:
a) by level of education
University
Secondary education
Foreman education
Vocational school
Middle school
b) by age
under 30 years
30-40 years
23.49 %
26.59 %
3.79 %
34.12 %
12.01 %
3.97 %
15.91 %
Page 38 of 98
Board of Director’s Report 2016
40-50 years
50-60 years
over 60 years
c) by activities
Gas production
Production tests/well special operations
Health
Transportation
Gas storage
Electricity production
40.95 %
30.88 %
8.28 %
62.47 %
11.34 %
1.23 %
8.92 %
8.41 %
7.64 %.
Distribution of Romgaz employees by headquarters and by branches is shown in the figure
below:
STTM
9%
SIRCOSS
11%
Iernut Branch
8%
Headquarters
7%
Medias Branch
31%
Ploiesti Branch
8%
Targu Mures
Branch
26%
The employees’ structure at the headquarters and branches is shown in the table below:
Entity
Workers
Foremen
1
Headquarters
Medias Branch
Targu-Mures Branch
Ploiesti Branch
SIRCOSS
STTM
Iernut Branch
TOTAL
2
3
31
1,488
1,316
338
511
427
320
92
51
30
52
19
44
Admin
employees
4
379
347
275
157
145
111
113
Total
5
410
1,927
1,642
525
708
557
447
4,431
288
1,527
6,246
The main areas of training during 2016 were:
Training of administrative employees in various areas of activity, in cooperation with
training suppliers from the country and abroad;
Authorization/re-authorization, according to specialization and work place;
Page 39 of 98
Board of Director’s Report 2016
Skills improvement and vocational training of workers through internal training
courses.
A number of 1,948 employees were trained during 2016, and the costs of such professional
training and skills improvement training courses were RON 1,175,809.79.
The annual training program was implemented as follows:
in accordance with the Labour Code, a total of 460 persons did not participate to any
training over the past 2 years out of which 149 administrative employees and 311
workers were trained and 610 employees participated in training courses to obtain
authorization/reauthorization in accordance with their specialization and work place.
511 persons participated to professional training programs with professional subjects
applicable to their activity.
During 2016, the professional training activity focused mainly on sustaining increase of
adaptability to new economy requirements based on knowledge, in order to ensure and update
required competencies for employees working in the technical, economic and research-
development field, such as:
o Certification of technical, drilling and oil and gas wells-related competencies for
11 persons, experts and professionals, who attended IWCF certification courses at
U.P.G. Ploiesti;
o
o
implementation of the International Financial Reporting Standards required
training and skills improvement of employees in the economic and financial field.
9 employees participated to such training courses in 2016;
to comply with the legislation in force and to offer the employees information
meant to reduce the risk degree in the field, 41 employees, heads of organizational
units, participated in 2016 in courses with the theme combating corruption risk.
Within Romgaz there are two trade unions, as follows:
“Sindicatul Liber din cadrul SNGN Romgaz SA”, consisting of 6,204 members;
“Sindicatul Extracţie Gaze şi Servicii”, consisting of 17 members.
The total number of union members is 6,221 as compared to 6,246 representing the total
number of employees. The union members/total number of employees’ ratio is 99.69%.
Relationship between manager and employees: following negotiations, the parties have
agreed to conclude a new Collective Labour Agreement, valid for 2017 and 2018.
During 2016, there were conflicts between the management and the trade union (see Annex
no.3 - Litigations: Items 73, 79, 80, 97, 100, 116, 173, 186 and 189).
In 2016, the environment protection activity continued to focus on compliance of Romgaz
activities with the applicable legal requirements on environment protection. Another aim was
meeting specific objectives related to:
Increase of awareness regarding compliance with legal requirements;
Pursuing the accomplishment of all reports imposed by the environment legislation in
force, by centralizing the information required and reported by Romgaz Branches and
submitted to public authorities;
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Board of Director’s Report 2016
Rendering efficiency to environment protection, a support for Romgaz management
process.
The environment protection activities during 2016 focused on:
fulfilment of requirements deriving from the ISO:14001 and ISO:9001 standards;
complying with permitting requirements:
complying with legal requirements relating to environment permits for all 141
units. The conformity degree is 100% - for 1 objective the company has
requested the review of the permit, for 1 objective the authorization
documentation is submitted (new objective) and for 1 objective the regulation
document sets a conformity plan containing - measures to reduce current and
future effects of the activity. Measures consist of equipping 3 wells with safety
equipment (packer and TRSV safety valve). Completion dates are December
31, 2015, December 31, 2016 (for 2 wells), and for 1 well the completion date
is December 31, 2017 and will be financed by own means. The December 31,
2015 and December 31, 2016 deadline were observed, the conformity
inspection was carried out by the Environment Guard – Mures County Office
and by Mures Environment Protection Agency;
complying with legal requirements regarding waste water management
permits, for:
83 units for which the conformity degree is 100% - to be noted that for 5
objectives permits are renewed; and,
38 units related to systems/injection wells, out of which 7 are under
renewal process.
A company-wide application has been developed to monitor environment permits, and to
permanently analyse and continuously supervise compliance with legal requirements in
the field of environment protection;
Disposal of waste generated from own activity, in accordance with legal requirements
in force. In 2016, the company’s activity generated 5,191.851 tons of wastes out of
which 1,872.808 tons were recycled and co-incinerated (1,869.137 tons were recycled
and 3.671 tons were co-incinerated), 36.892 tons of wastes were disposed by
incineration and 3,282.101 tons of wastes were disposed by storage.
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Board of Director’s Report 2016
2016 AMOUNT OF GENERATED WASTE (5,191.851 tons)
36 892
1 872 808
3 282 101
6 000 000
5 000 000
4 000 000
3 000 000
2 000 000
1 000 000
Quantity disposed by storage
Quantity disposed by recycling and co-incineration
Quantity disposed by incineration
In 2016, the “Program for Prevention and Reduction of Waste Generated by S.N.G.N.
Romgaz S.A. activity” was updated with specific legal requirements related to package waste
management. This program considers measures and methods for the prevention and reduction
of quantities of waste resulting from the company’s activity. Such Program complies with the
applicable regulations and contains a preferred prioritization of waste management. The
Program aims at identifying objectives, targets and policy actions which the company is
required to comply in its waste management activity in order to fulfil the company’s strategic
objectives.
Romgaz Waste Flow
Measures and methods were identified in the assessments on waste quantity reduction
and in the references of the internal audit relating to waste. The priority of waste
management relates to reduction of waste at source, recycling, valorisation, treatment
Page 42 of 98
Board of Director’s Report 2016
and last but not least disposal by incineration or storage. This Program was drafted in
accordance with the Romgaz Quality and Environment Policy Statement and was
endorsed by the National Agency for Environment Protection.
Also in this case, Romgaz developed an application for waste management control,
whereby a permanent analysis and a continuous supervision of compliance with legal
requirements (waste management in accordance with legal requirements, tracking of
waste management performed by authorized contractors etc.);
monitoring the compliance with legal requirements on environment protection, by
monitoring ways to clarify the exceeding of limits permitted by regulations in force.
For the entire company, permanent analysis and continuous supervision is carried out
in connection with the physical-chemical, bacteriological and biological indicators of
emitted pollutants, the frequency and ways of using results. In 2016, Romgaz
exceeded the legally allowed limit, when loading pollutants exceeding the maxim
allowed level when discharging faeces of the wastewaters in Sublohac Runlet;
penalties were paid in this respect;
monitoring the settlement of environment notifications and complaints against
Romgaz. In 2016, four external environment complaints were recorded, as follows :
notification regarding oil products iridescences for Zeletin Runlet, Glavanesti
Commune, Razesu Village, in accordance with the Inspection Report no. 35 of
January 5, 2016. Romgaz representatives called Emergency Services 112 on
January 5, 2016 and the organizational units appointed to analyse/research the
recorded irregularities were:
National Environmental Guard of Bacau;
ISUJ Bacau (Inspectoratul pentru Situatii de Ugenta - Inspectorate for
Emergency Situations of Bacau County);
National Administration “Apele Romaneˮ;
A.B.A. Prut-Barlad Iasi (Administratia Bazinala de Apa, Water - Basin
Administration) – SGA Galati.
Subsequently, the oil product film was eliminated, the corroded pipe section
was replaced with a new section for a distance of 9 m long, being put into
function after pressure tests were run, restarting pumping the oil-filed waters in
Well 70 Glavanesti;
Annual flood of a soil, nearby the under-crossing area of the railway of a
collector, Aninoasa Commune, Bobaia Village, Gorj County, claim no.
10088/29.03.2016. On April 7, 2016 the employees of Bibesti Work Formation
transported soil and levelled the whole at the end of the protective pipe of the
collector, to stop the drainage of the rain water over the claimer’s land;
Pollution of approximately 2,500 m2 land located downstream of Group 5
Hurezani, Gorj County, claim no 5859/15.02.2016. The pedological study
contracted by Romgaz highlighted the fact that the analysed land, unlike the
adjacent areas, is weakly, moderately and strongly salinized, being in V quality
class, unlike the adjacent which is III quality class. The study proposes
ameliorative measures, intended to be implemented. The negotiation procedure
with the land’s owner and the implementation of the ameliorative measures
proposed by the Pedological Study are in progress. The claimer, through his
statement of December 6, 2016, mentions that he has no material claim as far
as concerns the ameliorative measures proposed by the pedological study;
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Board of Director’s Report 2016
Soil pollution at approximately 50 m downstream of Well 46 Hurezani and two
wells from the yard of the claimer, claim no. 13960/27.04.2016, Hurezani
Village, no.75, Gorj County. Following the analysis taken at the scene, it was
determined that the vegetation has a normal evolution, just that the soil is
inclined. A pedological study was proposed to confirm the quality of the soil as
compared to the adjacent areas as well as an analysis of the water from the
wells in the claimer’s yard. Thus, on July 18, 2016, 4 water samples were
taken and the indicators which could derive from the formation waters
drainages were analysed (chloride, oil products, copper, zinc, lead, nickel,
manganese, chrome and ammonium). It was noted that all four samples
presented very close values and they respected the provisions of the Drinking
Water Law no. 148 of July 8, 2002, as subsequently amended and completed.
On September 12, 2016, by Order no. 7293-S-MEC, a pedological study was
required from OSPA Gorj (the National Institute for Research and
Development for Pedology, Agro-chemistry and Environment Protection) to
certify the soil quality as compared to the adjacent areas. OSPA Gorj took soil
samples, as compared to the adjacent areas of the claimer’s land. The
pedological study elaborated by OSPA Gorj presents
the following
conclusions: “the soil is not salinized, its quality class is IV, like the adjacent
areas”;
after extending the scope of business by taking over Iernut thermoelectric power plant,
the aim was complying with the legal requirements applicable in this field of activity,
in 2016 has been monitored a total of 895,835 CO2 volume tons for burners IMA 1, 2,
3, 4, 5. In Annex no. 3 “National Investment Plan” of the Government Decision no.
1096/2013 for the approval of provisional free allocation of greenhouse certificates to
electricity producers during 2013-2020, Romgaz is included at line 22 with the
“Combined Cycle Gas Turbine” investment (according to Government Decision no.
151/2015 for the amendment of Government Decision no. 1096/2013 for the approval
of provisional free allocation of greenhouse certificates to electricity producers during
2013-2020, the National Investment Plan included). According to Annex 1 of the same
Government Decision, Romgaz, as operator, received for CTE Iernut for 2016,
549,763 greenhouse certificates (EUA). Romgaz acquired in 2016 a total number of
549,763 greenhouse certificates. As of December 31, 2016, Romgaz held in the
account of the Sole Register of Greenhouse Gas Emissions a number of 762,416 CO2
certificates, as follows:
o 984053 certificates were used for conformity of 2015 emissions ;
o 687204 certificates acquired in September 2015, namely the first 2015 tranche
(50%) and in November 2015 the second 2015 tranche (50%);
o 824645 certificates for 2014 were used for partial conformity of 2014
emissions, namely 828793 tones of CO2;
o of the total of 962085 certificates acquired for 2013, 507620 were submitted
for conformity of 2013 emissions. Therefore Romgaz used out of the 454465
remaining certificates - 4148 for 2014 conformity, and was left with 450317
certificates;
o 7587 certificates submitted at Electrocentrale Register, Bucuresti, afferent to
the conformity of January 2013 emissions. Romgaz intended to obtain
conformity when acquiring CET Iernut, respectively on February 2013;
o 549763 CO2 certificates for 2016, acquired in two tranches on December 2016.
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Board of Director’s Report 2016
Starting with 2016, Romgaz-SPEE Iernut lacks CO2 certificates necessary for
emissions conformity, thus:
o In 2016 the Electric Power Station released 895,835 tons of CO2, the account
of the Sole Register of Greenhouse Gas Emissions on December 31, 2016
being 762,416 CO2 certificates. Thus, a shortage of 133,419 CO2 certificates is
registered, necessary for conformity of 2016, which are about to be acquired
during the first quarter of 2017 and no later than April 30, 2017 (the legal term
for conformity of 2016 emissions), from the Stock Exchange, by means of a
brokerage firm.
According to Commission Regulation (EU) No. 1123/2013 of November 2013 on
determining international credit entitlements pursuant to Directive 2003/87/EC of the
European Parliament and the Council, the Protocol to the United Nations Framework
Convention on Climate Change (the Kyoto Protocol) establishes two mechanisms for
the creation of international credits that Parties may use to offset emissions. Joint
Implementation (JI) provides for the creation of emission reduction units (ERDs),
whereas the Clean Development Mechanism (CDM) provides for the creation of
certified emission reductions (CRs). The industries the fall under the European
emissions trading system to atmosphere (EU ETS) may use these credits to
compensate their obligations as regards the greenhouse gas emissions.
In this respect, Romgaz acquired as availability of linking (availability of EUA – ERU
certificates correlation) a number of 51598 ERU certificates available to be used for
conformity for 2013 – 2020.
According to Decision No. 1096 of December 17, 2013 for the approval of provisional
free allocation of greenhouse certificates to electricity producers during 2013-2020, as
operator, Romgaz received CO2 certificates, as follows:
Operator
Installation
Annual Allocation (tCO2/year)
SNGN
Romgaz SA
SNGN Romgaz
SA - CTE Iernut
2013
2014
2015
2016
2017
2018
2019
2020
962,085
824,645
687,204
549,763
412,322
274,882
137,441
-
the
based on the recommendations made by the Due Diligence Study, performed with the
aim of establishing the conformity level of the company to the environmental
legislation in force, identification of past and present environmental issues, as well as
future environmental risks the company may face, a Report on Significant
Environment Issues Remediation was prepared whereby costs, solutions and
implementation terms for remedy measures were assumed. In 2016, Romgaz
monitored
implementation of permanent measures and of multiannual
implementation terms measures contained in the Remediation Report (maintaining the
perchloroethylene consumption below 1 ton/year for each location so that the
provisions of Government Decision no. 699/2003 on setting measures to reduce
emissions of volatile organic compounds due to use of organic solvents for specific
activities and installations; requesting the renewal of environment permits with 45
days prior to the expiration; locating industrial objectives at sufficient distance from
the protected receptors: reducing fugitive emissions in the area of calibration tanks, of
metal tanks and of concrete tanks for temporary storage of reservoir water by
equipping the tanks with ecological dispersion systems; periodic payment to the
“Closing Fund” until the set value of provision is met for the specific waste storage at
Page 45 of 98
Board of Director’s Report 2016
Ogra; annual monitoring frequency for Dumbravioara drilling waste storage closed in
2003, etc.);
scheduling and organizing the environmental internal inspection, in order to verify
conformity with legal requirements applicable to inspected activities.
In 2016, 42 environmental internal inspections were scheduled and performed (from
Romgaz headquarters on authorized units of the branches), further to which 22
Reports of Determined/Potential Nonconformity were made, out of which 16 were
closed within assumed time limit, 1 open (within assumed time limit), and 5 closed,
with outdated time limit. Also, Romgaz branches scheduled and performed 119
environmental internal inspections further to which 2 Reports of Determined/Potential
Nonconformity were made, which were closed within the time limit;
assessment of conformity
to environment protection requirements and
contractual requirements of contractors and sub-contractors of drilling works
contracted by Romgaz in 2016;
level
implementation of the 2016 action/measure programs for preventing and/or mitigating
impact on the environment, that were implemented as follows:
works for noise reduction and heat recovery from moto-compressor exhaust
system;
landslide fighting;
installing waste water collection tanks;
installing impurities filtering systems;
transforming abandoned wells into reservoir water injection wells;
installing waste water discharge installations;
installing soundproof panels;
greening of contaminated areas;
making payments for environment protection and permitting;
environment protection works required for well modernization; environment
protection works for modernization of well clusters by installing safety power
generators;
modernization of technological installations and of infrastructures (platforms);
environment restoration works upon abandoning well;
maintenance and repair works at waste water treatment plants;
expenses in connection with transportation, takeover and disposal of hazardous
and non-hazardous waste;
environment works at decommissioning;
expenses in connection with reservoir water transportation and waste water
discharge;
expenses in connection with lab analyses;
expenses in connection with maintenance and cleaning of waste industrial
installing environment-friendly discharge systems;
water separators;
CO2 account management fee (SPEE Iernut);
CO2 validation report fee;
Expenses in connection with metering NOx emissions and dust at boilers 1, 4,
and 5 of SPEE Iernut;
Equivalent value of CO2 certificates.
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Board of Director’s Report 2016
In 2016, The Environment Guard made 33 inspections at Romgaz locations, and “Romanian
waters” National Administration made 10 inspections. Following such inspections Romgaz
was not sanctioned / fined.
In 2016, no environment accident was recorded by Romgaz.
The summarized statement of litigations is the following:
198 litigations, out of which:
109 cases where Romgaz is complainant;
83 cases where Romgaz is defendant;
5 cases where Romgaz is plaintiff claiming damages/injured party;
the (approximately) total value of the files where Romgaz is complainant is RON
2,081,718,247.18;
the (approximately) total value of the files where Romgaz is defendant is RON
38,046,596.59 and Euro 80,000.
The detailed list of litigations is shown in Annex 3 to this report.
The occurrence and thereafter the development and gradual diversification of what was truly
going to be the Romanian natural gas infrastructure has an important benchmark, year 1909,
when the first gas reservoir was discovered by drilling well 2 Sarmasel (Mures county).
During the immediately following years, a unique gas infrastructure for those times started to
outline in Europe at a reduced scale, consisting of the following assets:
gas transmission pipeline, the first of this kind in Europe, build in 1914, connecting
(cid:0)
towns Sarmasel and Turda (Cluj county) and
(cid:0)
gas compressor station from Sarmasel; build in 1927- the first one in Europe.
It is notable that the country’s large gas structures were discovered after 1960 and in parallel,
a complex infrastructure started to be developed at national scale dedicated exclusively to the
gas extraction process and later to the injection and underground storage process. These large
gas structures located in the Transylvanian basin supply even today considerable gas
quantities.
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Board of Director’s Report 2016
The infrastructure related to field production and to gas storage in depleted fields turned into
underground storages, looks today as a particularly complex system.
As a whole, the infrastructure of the company developed continuously before and after 1989.
The development of the production capacities reached the peak during 1970–1980 when the
annual production was extremely high, both due to the consumption demand and to the
considerable reservoir energy of most discovered gas fields.
Part of the company’s production infrastructure (assets) resulted from the nationalisation of
June 1948.
Currently, no natural or legal person, from the country or from abroad, claimed any asset of
Romgaz.
Although operational, most of the production facilities are several decades old, therefore, a
rehabilitation and modernisation process started a few years ago consisting of installing,
replacing or upgrading gas delivery/take over fiscal panels, gas drying stations, gas
compressor stations.
The production facilities relating to the company’s infrastructure are:
1.
2.
3.
4.
5.
6.
7.
8.
9.
Gas wells (actually producing wells, temporary suspended wells waiting for
reactivation or recompletion operations, wells for reservoir water injection);
Pipelines (gathering pipelines connecting the well clusters, waste water pipelines,
industrial water pipelines);
Gas heaters (radiators);
Gas separators (underground separators, surface separators);
Flow metering panels (technological flow metering panels for almost every gas field,
fiscal or commercial flow metering panel located at the interface with the NTS);
Gas drying stations (conditioning):
Gas compression units:
•
•
•
low capacity portable compressors installed at the well head or at the cluster,
booster compressors for one or more fields,
compressor stations, usually consisting of one or more units, intermediate or
final compressor stations (outlet to the NTS);
Industrial or reservoir water pumping stations;
Other facilities (buildings, workshops, electric lines, well access roads etc.).
Production facilities are used at their maximum capacity (close to 100%).
Currently 148 gas fields are producing out of which 143 are well defined blocks and the rest
are fields with experimental production.
Production from these fields is made by approximately 3260 wells and by almost the same
number of technological surface facilities consisting of flowlines, heaters (where the case may
be) liquid separators and gas flow metering panels.
From the total number of wells, 26% of the wells produce at depths over 2,000m. Pressure
and flow limits of production wells are operated by 115 compressor units, 91 units are
Page 48 of 98
Board of Director’s Report 2016
grouped in 19 compressor stations, 17 units are the so-called booster compressors and 7 units
are located at well clusters.
One technical demand required by applicable laws is the quality of gas which is fulfilled more
than 99% by means of 71 gas drying stations.
The other component of the company’s infrastructure, namely the information – technical
system consists of all information equipment and programs (software) used to monitor the
parameters related to gas research, production and storage activities. These complex
information programs consist of a series of modules that process the data received further to
seismic surveys of the earth crust, collects information resulting from gas wells researches,
information related to production history and other technical input data for performing cash
flow analyses.
Processing and interpretation of these input data leads to preparing extensive technic and
economic specifications called geological studies. These studies also analyse and substantiate
the investments planned for the field in question. The investments together with other
production stimulation works become mandatory once the geological study is approved by the
ANRM.
Bilciuresti Storage
Characteristics:
Location: Dâmboviţa County, approximately 40 km V-NV from Bucharest;
Commissioned in 1983;
Capacity:
o Working capacity: 1,310 million m3;
o Delivery capacity: 17 million m3/day;
Main fixed assets: 61 wells out of which 57 injection/extraction wells, 3 piezometric
wells, 1 residual water
injection well, 26 km of gathering pipelines for 57
injection/extraction wells, 50 gas heaters, 24 separators, 14 gas metering facilities, 7
drying stations, 33 km gathering pipeline, 3 reservoir monitoring parameters systems, bi-
two-stage
dimensional fiscal metering system equipped with ultrasonic meter,
compression station (Butimanu) composed of three compression modules and waste water
injection station.
Currently, design works for UGS upgrading were contracted with the scope of ensuring the
quality of the delivered gas quantities through the NTS as well as to increase the withdrawal
capacity to a maximum of 20 million m3/day.
Sarmasel Storage
Characteristics:
Location: near Sarmasel, approximately 35 km NW from Tirgu-Mures, 35 km north
from Ludus and 48 km east from Cluj-Napoca.;
Commissioned in 1996;
Capacity:
o Working capacity: 950 million m3;
o Delivery capacity: 9.0 million m3/day ;
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Board of Director’s Report 2016
Main fixed assets: 63 wells, 26 km gathering pipeline for 63 wells, 77 separators, 9 km
collector, 1 reservoir monitoring parameters system, bi-directional fiscal metering
system equipped with ultrasonic meters, compressor station (Sarmasel)
In 2016, following investments are in progress in order to increase the working capacity of the
storage up to 900 million m3/cycle:
A new gas compressor station equipped with 4 compression units ;
3 gas drying stations;
Upgrading and flexibility of the fiscal metering system;
4 injection/extraction wells, including afferent technological installations;
5.5 km collectors, the link between the new compressor station – ISM measure panel.
Urziceni Storage
Characteristics:
Location: Ialomita county approximately 50 km NE from Bucharest
Commissioned in 1978;
Capacity:
o Working capacity: 360 million m3;
o Delivery capacity: 4.7 million m3/day;
Main fixed assets: 30 wells out of which 28 injection/extraction wells and 2 piezometric
wells, 18 km of gathering pipelines for 28 injection/extraction wells, 28 gas heaters, 6
technological gas metering facilities, 1 drying station, 3.3 km gathering pipeline, 3
reservoir monitoring parameters system, bi-directional fiscal metering system equipped
with ultrasonic meters, optic fibre data acquisition system; compressor station (Urzicieni).
In 2016, the following investments are in progress in order to ensure the delivered gas quality
in the NTS as well as to constantly maintain the daily extraction capacity at an average of 4
million m3/day:
Upgrading natural gas drying station;
Upgrading surface infrastructure.
For 2017, 2 new injection/extraction wells were put into operation, works that are currently
under tender.
Cetatea de Balta Storage
Characteristics:
Location: approximately 12 km S-V from Târnăveni;
Commissioned in 2002;
Capacity:
o Working capacity: 100 million m3;
o Delivery capacity: 1 million m3/day;
Main fixed assets: 14 wells, 7 km gathering pipelines for 14 wells, 6 separators, 6
technological gas metering facilities, 10 km gathering pipeline, field supervising system
and fiber-optic data acquisition system.
Ghercesti Storage
Characteristics:
Location: Dolj County, near Craiova;
Page 50 of 98
Board of Director’s Report 2016
Commissioned in 2002;
Capacity:
o Working capacity: 150 million m3;
o Delivery capacity: 1.5 million m3/day;
Main fixed assets: 83 wells, 157 km gathering pipelines for 83 wells, 13 separators, 6
technological gas metering facilities, 1 drying station, 42 km gathering pipelines, 7
reservoir monitoring parameters systems, bi-directional fiscal metering system with two
metering lines, equipped with ultrasonic meters and communication system and fiber-
optic data acquisition system.
Balaceanca Storage
Characteristics:
Location: approximately 4 km from Bucharest;
Commissioned in 1989;
Capacities:
o Working capacity: 50 million m3;
o Delivery capacity: 1.2 million m3/day;
Main fixed assets: 21 wells, 10 km gathering pipelines, 15 gas heaters, 4 separators, 4
technological gas metering facilities, 1 drying station, 1.7 km gathering pipelines, 1
reservoir monitoring parameters system, bi-directional fiscal metering system equipped
with ultrasonic meters, compressor station (Balaceanca) and communication system and
fiber-optic data acquisition system.
Well workover, capital repairs and well production tests represent all the services performed
with workover rigs, as well as equipment for specific support operations such as: cement plug
drilling installations, mud tank equipped with agitator, sand control-sand blender, DST- cased
hole testing of productive layers, shale shaker, mud pumps.
Special Well Operations are performed with the following equipment: cementing unit,
slickline, wireline, coiled tubing unit, liquid nitrogen converter, liquid nitrogen tank truck,
cement container, filter unit, equipment for discharge and measurement with two-phase
separation, equipment fir discharge and measurement with three- phase separation, equipment
for tubing investigation, echometer, rental of tools and utilities, tubing cutting, packer
assembling device, hydraulic packer recovery tools, technical assistance for special well
operations, well fire-fighting equipment.
Future well workover and special well operations are required in order to stop production
decline.
The car fleet of the Branch for Technological Transportation and Maintenance consists of 635
vehicles and machinery, as follows:
passenger carriers: cars (117), land vehicles (105), minibuses (11), buses (2) and large
buses (2);
passengers and cargo carriers < than 3.5 t (33) and > than 3.5 t (83);
vehicles for cargo transportation: dumpers (23), cesspit emptier (33), platform trucks (16),
tank truck (3);
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Board of Director’s Report 2016
vehicles for heavy transportation: truck-tractors (3) and semitrailer trucks (10);
handling machinery: cranes from 12-18 t (6) and 24-35 t (12);
special vehicles: mobile laboratory for equipment testing and checking (1);
heavy machinery: bulldozers (8), caterpillar shovels (2), wheel loaders (13), motor grader
(3), compactor (3), front end loaders (11);
other machinery: tractor trucks (70), fork lift trucks, etc.;
other vehicles: trailers for heavy transportations, trailers and semitrailers.
STTM plans to ensure qualitative and economically efficient services due to the future
dynamics of Romgaz core business over the medium term (approximately 5 years).
CTE Iernut has an installed capacity of 800MW, including 6 power units: 4 Czechoslovakian
power units with an installed capacity of 100 MW each and 2 Soviet power units with an
installed capacity of 200 MW each. The units have been commissioned between 1963 and
1967.
The power plant is connected to the main road E60 by a 1.5km long road and to the national
railway system at Cuci by a 2km railway both owned by the CTE Iernut.
Operating restrictions imposed by applicable environmental regulations
The 100 MW Power Units 1 and 4
During 2013, by commissioning a flue gas recirculation system for boiler no. 1, NOx
emissions were reduced from 800 mg/Ncm flue gas to 300 mg/Ncm, complying therefore
with environmental regulations.
In compliance with the integrated environmental authorization for CTE Iernut, power units
no.1 and 4, with an installed capacity of 100MW each, may operate on a transition period
until June 30, 2020. The maximum NOx emissions must be reduced from 300 to 100 mg/Ncm
flue gas within this period.
If this last measure is not taken, the units will not be allowed to operate after June 30, 2020.
The 100MW Power Units 2 and 3
Change of environment protection legislation, namely, Directive CE 2010/75/EU allow
limited time of operation for units 2 and 3 in case the emission reduction equipment of one or
more groups break down and power supply is a priority requirement. Therefore, as of January
2016, units 2 and 3 shall be put in dry preservation.
The 200MW power units 5 and 6
Low NOx emission burners have been installed in years 2010 and 2011. As such, an
environmental requirement included in the integrated environmental authorization was
fulfilled.
Due to these measures, the power units automatically enter the new transition period during
January 01, 2016 - December 31, 2020.
Page 52 of 98
Board of Director’s Report 2016
Investments play an important part in arresting the production decline, which is achieved by
discovering of new reserves, by improvement of the current recovery rate, and by
rehabilitation, development and modernization of existing facilities.
The company invested during 2013-2016 approximately RON 3.37 billion, as follows:
Year
2013
2014
2015
Amount (RON
thousand)
848,247
1,085,497
937,916
2016
497,716
Total
3,369,376
For 2016, Romgaz scheduled investments worth RON 1,020 million and invests RON 497.7
million, with 51.2% less than scheduled. In 2016 investments were RON 440.2 million lower
than the investments made in 2015. The company financed all investments from own sources.
The value of fixed assets commissioned during the reporting period was of RON 581.5
million.
The Director General approved the 2016 investment program and the relating budget was
approved as Annex 4 to the income and expenditures budget by GMS Resolution no.5 of
June, 2016.
Major investments target in general projects such as:
continuing geological research works by performing surveys and drillings for the
discovery of new gas reserves;
production development by adding new facilities on existing structures;
improving the performance of facilities and equipment and increasing production
safety;
increase of underground storage capacities, flexibility and security of the existing
storages;
The table below shows the actual investments in relation to the scheduled ones and to the
2016 results:
Investment chapter
Ite
m
no.
0
1.
1.1 Natural gas exploration, production works
1
Investment in progress– total, out of which:
2015
*RON thousand*
%
2016
Schedule
Results
’16/’15
2
352,467
319,051
3
327,899
252,819
4
238,433
178,285
5=4/2x100
72.71
55.88
1.2 Maintaining UGS capacity
32,374
75,000
59,953
185.19
1.3 Environment protection works
2. New investment – total, out of which:
2.1 Natural gas exploration, production works
2.2 Maintaining UGS capacity
2.3 Environment protection works
3.
Investment in existing tangible assets
1,042
297,039
292,440
112
4,487
224,664
80
325,201
305,237
15,000
4,964
245,441
195
21,316
18.71
7.18
19,995
6.84
1,287 1,149.11
0.76
89.46
34
200,983
Page 53 of 98
Board of Director’s Report 2016
4. Equipment (other acquisition of tangible
assets)
5. Other investment (studies, licenses, software,
financial assets etc.)
*
TOTAL
54,080
88,897
31,838
58.87
9,666
32,562
5,146
53.24
937,916
1,020,000
497,716
53.07
The chart below shows the main investment chapters:
40.38%
6.40%
1.03%
12.30%
5.58%
0.05%
34.26%
I. Geological exploration works for the discovery
of new gas reserves
II. Exploitation drilling works, putting into
production of wells, infrastructure and utilitites
III. Maintaining UGS capacity
IV. Environment protection works
V. Revamping and modernization of installation
and pieces of equipment
VI. Independent equipment and installations
VII. Expenses in connection with studies and
projects
The summary of the achieved investment projects is shown below:
Item
No.
1.
Main Projects
Drilling, exploration
2.
3.
Production drilling
Surface facilities – gas wells
4.
Compressor stations and drying stations in
gas fields
5.
Maintaining storage capacity
6.
7.
8.
Well recompletion
Well capitalized repair
Electricity production
9.
Partnerships
Planned
2016
31 wells
3 wells
15 wells
SC Tigmandru II
SU Galbenu II
Sarmasel Storage:
- compressor station
- drilling 4 wells
Urziceni Storage
- injection/withdrawal
system
- adapting surface
facilities
125 wells
140 wells
Performance of
capitalized repairs and
procurement of
equipment
Aurelian Petroleum
(Brodina):
Achieved
2016
14 wells completed
3 wells in progress
-
10 wells completed
3 wells in progress
completion postponed
in progress
completed
completed 95%
completed 95%
121wells
150 wells
full
Page 54 of 98
Board of Director’s Report 2016
completed
completed
not completed
not performed
not completed
partially completed
completed
partially completed
- the drilling of Voitinel
2 well
Raffles Energy (Bilca):
- abandoning Fratauti 1
well
- AVO study
Raffles Energy (Bacau):
- feasibility study for
Lilieci GTP – extension
of the capacity
Lukoil:
- drilling 1 new
exploration well
- drilling prepare works
- electromagnetic and
geochemical survey
-TT&T
Schlumberger:
- drilling of well 212
- Well 212- hydraulic
stimulation
- Well 212- surface
facilities
- Well 135- directional
drilling
- Well 125-
recompletion operations
- snubbing operations for
wells 131 and 134
- remote flow rate
monitoring system
- automated foam
injection unit
Amromco:
- seismic acquisition in 2
blocks
- drilling 3 wells
partially completed- 2
partially completed
completed
- recompletion
operations for 9 wells
- surface facilities for 3
wells
Slovakia:
- drilling 3 wells in
blocks Svidnik, Snina
and Medzilaborce
Poland:
- Torzym: maintaining
licences, preparation of
G&G and G&A,
Works for abandoning
Sosna- 1 well
- Cybinka: preparation
of G&G and G&A
Reservoir studies
wells
partially completed- 7
wells
partially completed
(50%)
not performed
partially completed
completed
100%
Page 55 of 98
10. Studies
Board of Director’s Report 2016
Procurement contracts have been concluded by the end of 2016 for works to be provided
during 2016-2020 of RON 1,660 million, including works rendered by the company.
A significant event is the contract conclusion (design and execution) for “Developing CET
Iernut through construction of a new electricity station, with combined cycle gas turbine”,
with deadline for completion in 2020.
Main investments commissioned during the analysed period of RON 581.5 million:
drilling: 14 wells;
surface facilities: 10
Sarmasel compressor station;
Well recompletions: 121 wells;
Well capitalizable repairs: 150 wells;
Separate equipment.
One very complex issue largely impacting the implementation of the investment plan is
found in the investment preparation phase and consists of obtaining land permits,
approvals, agreements and authorizations required for the performance of works. In order
to solve the above-mentioned issues, the company constantly approaches the state
institutions in order to have simple and short procedures for obtaining required approvals.
The level of results was negatively influenced by causes specific for the second phase:
- Difficulties regarding access to public roads for drilling activity;
-
Impossibility to obtain lands and implicitly, notifications and authorizations to build well
technological surface facilities and gas collectors;
- Delays of approximately 2 months when performing the procurement procedures
generated by the change of procurement legislation.
The work completion degree in relation to the work programs for each partnership is indicated
below:
Item
No.
1
2
3
4
5
6
*
Partnership
Romgaz, Alpine Oil&Gas and JKX Oil&Gas
- Slovacia
Romgaz, Aurelian Oil&Gas Poland and
(financial
Sceptre Oil&Gas
investment)
- Poland
Romgaz and Aurelian
Romgaz and Amromco
Romgaz and Schlumberger
Romgaz, Lukoil and PanAtlantic
Total work program
2016
Schedule
2016
Results
Results/
Schedule
6,080.51
1,704.32
28.03%
1,005.66
311.03
30.93%
5,478.96
27,488.75
43,562.87
17,147.41
4,854.07
18,112.19
3,766.82
7,424.52
100,764.16
36,172.96
88.59%
65.89%
8.65%
43.30%
35.90%
Page 56 of 98
Board of Director’s Report 2016
Important issues to be noted:
By the end of 2016, electromagnetic and geochemical survey works were performed
for exploration stage II within Trident Block. The differences between the budgeted
and accounted amounts for G&G Studies are explained by obtaining 50% lower prices
than the provided ones for the geo and electromagnetic studies. In addition, the
budgeted sums for T&TT, of USD 500 thousand were not completely spent, these
being reported for the following period. Exploration Stage II was extended with a year
and a half, and it caused the postponement of the preparing drilling works, geohazard
(seismical) works and other technical studies. This postponement reflected upon the
budget execution of 2016, meaning the unfulfilment of the approved investments(
Romgaz, Lukoil and PanAtlantic Association);
At the beginning of the year, drilling activities started at well Voitinel 2 , which was
subsequently abandoned. The well Voitinel 1 is plugged and abandoned until
September 23, 2017. The Operator proposed the budget for 2016 only for the first 10
months of the year, as they expressed their intention to withdraw from the association
in October 2016. On January 2017, ANRM issued a Notice of Abandonment for Well
Voitinel 2 ( Romgaz and Aurelian Association);
Related to the blocks in Poland, unfavourable results were obtained further to
drilling Sosna 1, as well as the continuous delay of drilling works performance by the
partners for the last 2 years, which determined Romgaz to decide to withdraw from the
Polish concessions. Currently, Romgaz is no longer shareholder in the two entities, but
the full withdrawal formalities have not been completed, because there are still
discrepancies between Romgaz and the Operator’s opinion as regarding Romgaz’s
rights and obligations assignment resulting from the Loan Agreement (Romgaz,
Aurelian Oil& Gas Poland and Sceptre Oil&Gas- Poland Association);
3D seismic acquisition in the fields Balta Alba and Gura Şutii was acquired in 2016.
The 3D seismic acquisition in the fields Fierbinti and Zatreni-Tetoiu was postponed
according to the decision of the Management Steering Committeee, by Minutes of
April 7, 2016. In the Investment Program was estimated the drilling of three wells, out
of which the drilling of wells Frasin Brazi 121 NW and Bibesti 212 was performed
following the drilling of the third well Bibeşti 211 to be completed in January 2017.
Postponing the drilling was due to the lack of the drilling rig. The mandatory
capitalized repairs at Finta-Gheboaia 208 and Zatreni 37 were postponed due to the
financing problems of the Operator. According to the decision of the Management
Steering Committee, by Minutes of September 1, 2016 recompletion operations were
performed at wells: Frasin Brazi 121, 121 NW and 123, Finta-Gheboaia 206. The
construction of gathering pipelines and surface facilities for these wells were also
approved; these works were achieved at a rate of 47.46% due to postponing the
drilling of Bibeşti 211 well for January 2017. The completion of the gathering
pipelines Bibeşti 211 and 212 were also postponed, following to be performed in the
first months of 2017. The abandonment of two wells: Balta Alba 105 and Finta-
Gheboaia 46 ( Romgaz and Amromco Association);
In 2016 preparatory drilling works were performed. The drilling of the three wells
scheduled for 2016 delayed due to the fact that the Operator encountered hostilities
from the local community and authorities. The necessary documentation for obtaining
access to the location was submitted to the Environment Ministry, according to Article
29 of Law of Geology. The exceeding of 42.95% of the G&A is due to the fact that
this category includes the expenditures with security and legal consultancy determined
by the above-mentioned hostilities. This exceeding will be covered by budgetary
Page 57 of 98
Board of Director’s Report 2016
reallocation from “Taxes and Licence”. (Romgaz, Alpine Oil&Gas Association-
Slovakia)
Snubbing operations at wells LM 131 and LM 134 began in March and ended in April.
In 2016 taxes were paid to start the drilling works for well LM 212 and automatic
foam stick launching were purchased. Failure to meet with the 2016 Investment
Program 2016 is mainly due to not-performing the drilling for well 212, not-
performing the deepening works for well 135 and not-performing the recompletion
operations for well 125, given that Schlumberger, as associate, has conditioned its
participation in the 2016 investment program 2016 upon the approving of an
addendum to extend the contract of association (Romgaz and Schlumberger
Association).
Page 58 of 98
Board of Director’s Report 2016
Government Decision no.831/August 4, 2010 on the approval of the privatization strategy by
public offering of Societatea Nationala de Gaze Naturale “Romgaz” S.A. Medias, and the
mandate of the public institution involved in the development of such process approved “the
sale by secondary initial public offering of shares representing 15% of S.N.G.N. “Romgaz
S.A. share capital by the Ministry of Economy, Trade and Business Environment, through the
Office of State Ownership and Privatization in Industry”.
Since November 12, 2013, the company’s shares have been traded on the regulated market
governed by BVB under the symbol “SNG”, and on the regulated market governed by LSE
(the London Stock Exchange) as GDRs issued by The Bank of New York Mellon under the
symbol “SNGR”.
Item
No.
Description
2013
2014
2015
2016
Number of shares
1.
2. Market capitalization4
*million RON
*million EUR
3. Maximum price (RON)
4. Minimum price (RON)
5.
6.
7.
8.
9.
Year end price (RON)
Net profit per share (RON)
Gross dividend per share (RON)
Dividend yield (7./5.x100)
Exchange rate (RON/EUR)
*) proposed dividend
385,422,400
385,422,400
385,422,400
385,422,400
13,178
2,952
35.60
33.80
34.19
2.58
2.57
7.5%
4.4639
14,018
3,127
36.37
32.41
35.36
3.66
3.15
8.9%
4.4834
10,483
2,315
36.55
26.30
27.20
3.10
2.70
9.9%
4.5285
9,636
2,122
27.55
21.60
25.00
2.66
2.49*)
9.96%
4.5411
At the end of year 2016, Romgaz share price was RON 25.00, lower by 28% than the closing
price at year end 2015. The maximum price per share (RON 27.55) recorded on March 25,
2016 (after the announcement of the dividend proposal for 2015), followed by a drop in price
reaching the lowest value of RON 21.60 on May 19, 2016. For H 2 the share price oscillated,
but the trend continued upwardly reaching by the end of 2016 the value of RON 25.10.
Since the listing date up to present, Romgaz is considered an attractive company for investors
and holds a significant position in the top of local issuers, being included in BVB indices as
well as in indices of other markets, as follows:
- Second place, by market capitalization, in the top of Premium BVB issuers. With a
market capitalization amounting to RON 9,636 million (respectively EUR 2,112
million) as of December 30, 2016, Romgaz is the second largest listed company in
Romania, being preceded by OMV Petrom with a capitalization in amount of RON
14,748 million, i.e. EUR 3,256 million;
4 Calculated on the basis of the closing price of the last trading day in the respective year, and on the basis of the
exchange rate announced by BNR, valid for the last trading day in the respective year
Page 59 of 98
Board of Director’s Report 2016
- Third place as regards the total amount of transactions in 2016, in the top of local
issuers in the main segment of BVB, preceded by Fondul Proprietatea and Banca
Transilvania;
- Weigh of 10.81% in the BET index (top 10 issuers) and 9.80% in the BET-XT index
(BET extended), 22.24% in the BET-NG index (energy and utilities) and 10.81 % in
the BET-TR (BET Total Return)5 index;
- Romgaz issuer is also included in global indices with allocation for Romania, for
instance in the following index groups: FTSE (Financial Times Stock Exchange),
MSCI (Morgan Stanley Capital International), S&P (Standard & Poor's), STOXX
(oriented mainly on the European markets), Russell Frontier.
At the end of the first trading day, Romgaz share price was RON 34.5, 15% higher than the
price paid by the institutional investors to buy the shares, and the closing price of GDRs was
USD 10.4, 13.66% higher than the subscription price.
Performance of Romgaz shares between listing and December 30, 2016, as compared to the
BET index, is shown below:
40.00
35.00
30.00
25.00
20.00
15.00
10.00
5.00
0.00
e
r
a
h
s
/
N
O
R
3
1
0
2
/
2
1
/
1
1
3
1
0
2
/
4
/
2
1
4
1
0
2
1
0
.
.
3
0
4
1
0
2
1
0
.
.
7
2
4
1
0
2
2
0
.
.
8
1
4
1
0
2
3
0
.
.
2
1
4
1
0
2
/
3
/
4
4
1
0
2
/
0
3
/
4
4
1
0
2
5
0
.
.
7
2
4
1
0
2
6
0
.
.
9
1
4
1
0
2
7
0
.
.
1
1
4
1
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2
8
0
.
.
4
0
4
1
0
2
/
8
2
/
8
4
1
0
2
9
0
.
.
2
2
4
1
0
2
0
1
.
.
4
1
4
1
0
2
1
1
.
.
5
0
4
1
0
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1
1
.
.
7
2
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1
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2
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.
2
2
5
1
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/
1
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/
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1
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5
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/
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1
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9
2
/
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5
1
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5
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/
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/
9
1
/
1
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1
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/
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1
/
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1
6
1
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/
3
1
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4
/
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1
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6
2
/
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6
1
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1
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1
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2
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1
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7
2
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6
1
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1
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6
6
1
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3
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7
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1
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/
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1
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1
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9
6
1
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1
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3
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1
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5
2
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1
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/
1
2
/
2
1
SNG
BET
9000.00
8000.00
7000.00
6000.00
5000.00
4000.00
3000.00
2000.00
1000.00
0.00
Performance of GDRs traded on the London Stock Exchange and RON/USD exchange rate
movements are shown below:
14.00
12.00
10.00
8.00
6.00
4.00
2.00
0.00
R
D
G
/
D
S
U
3
1
0
2
/
2
1
/
1
1
3
1
0
2
/
4
/
2
1
4
1
0
2
.
.
1
0
3
0
4
1
0
2
.
.
1
0
7
2
4
1
0
2
.
.
2
0
8
1
4
1
0
2
.
.
3
0
2
1
4
1
0
2
/
3
/
4
4
1
0
2
/
0
3
/
4
4
1
0
2
.
.
5
0
7
2
4
1
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.
.
6
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9
1
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7
0
1
1
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1
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8
0
4
0
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/
8
2
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.
9
0
2
2
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.
0
1
4
1
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.
1
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2
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2
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1
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1
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6
/
3
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1
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1
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1
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6
1
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2
/
9
2
/
1
1
6
1
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2
/
8
2
/
2
1
USD/GDR
lei/USD
5.00
4.50
4.00
3.50
3.00
2.50
2.00
1.50
1.00
0.50
0.00
D
S
U
/
i
e
l
5 Weights according to quarterly adjustments of indices on December 9, 2016.
Page 60 of 98
Board of Director’s Report 2016
Romgaz share denominated in USD (GDR) was influenced by the RON/USD quotation, with
RON that rose against the Dollar over the last period of review.
The General Meeting of Shareholders determines the value of dividends to be distributed to
shareholders considering the specific legal provisions.
Therefore, Government Ordinance no. 64/2001 on profits distribution as regards companies
where the State acts as majority shareholder and autonomous administrations, approved by
Law 769/2001, as subsequently amended and supplemented, provides at article 1, paragraph
(1), item (f) that the profit after deduction of profit tax shall be distributed as follows, unless
otherwise prescribed under special laws:
(a) legal reserves;
(b) other reserves representing tax facilities provided by law;
(c) covering accounting losses for the previous years, except for the retained
accounting losses as a result of adjustments required under the application of IAS
29 “Financial Reporting in Hyperinflationary Economies”, according to the
Accounting Regulations compliant with the International Financial Reporting
Standards and the Accounting Regulations in line with the Council Directive
86/635/EEC and the International Accounting Standards applicable to credit
institutions;
(c^1) setting own financing sources for projects co-financed out of external loans, as
well as for the amounts necessary for reimbursing capital instalments, paying
interests, commissions and other costs related to these external loans;
(d) other distributions provided by law;
(e) employees’ participation to profits; national companies and companies fully or
majority owned by the state, as well as autonomous administrations which
undertook and established in their income and expense budgets the obligation to
participate in the distribution of profits, as a result of the employees’ services in
relation thereto, may grant these rights up to 10% of the net profit, however not
exceeding the level of one monthly average base salary of the relevant company
during the respective financial year;
(f) a minimum of 50% contribution to the state or local budget, in the case of
autonomous administrations, or dividends, in the case of national companies and
companies fully or majority owned by the state;
(g)
the profit undistributed according to items (a) – (f) above is distributed to other
reserves and represents own financing sources.
Profit is distributed for the purposes and in the amounts referred to at paragraph (1) items e),
f), and g) after deduction of the amounts related to the purposes determined under special
laws stipulated at items a), b), c), c^1), and d) of the same paragraph.
Profit is distributed subject to the accounting profit recorded under statutory financial
statements which have been prepared according to the International Financial Reporting
Standards (IFRS), adopted by EU, in compliance with national legislation.
In accounting terms, participation of employees in the distribution of profit is registered as a
wage related expense recognized in the financial statement of the year when the profit was
obtained by the Company. The participation of employees in the distribution of profit is paid
in the subsequent year.
Page 61 of 98
Board of Director’s Report 2016
For the financial years ending December 31, 2012 and December 31, 2013, respectively, the
state-owned companies and the companies where the State acts as majority shareholder had
the obligation, established by the Government, to distribute an 85% share of profit as
dividends (under the Memorandum “Measures which must be observed while drafting the
income and expenses budgets of economic operators having whole or majority state
participation”).
Furthermore, since September 6, 2012, by way of derogation from the requirements of
Companies Law 31/1990 providing that dividends are to be paid no later than six months after
the approval of the annual financial statements, state-owned companies are required, in
accordance with the provisions of Government Ordinance no. 64/2001, to pay the dividends to
their shareholders within 60 days of the legal deadline for the submission of the annual
financial statements to the competent fiscal authorities.
The table below shows the status of dividends for the years 2014-2016:
Description
2014
2015
Proposal 2016
Dividends
1,214,080,560
1,040,640,480
959,701,776
Gross dividend per share (RON/share)
Dividend distribution rate (%)
3.15
86.11
2.70
87.13
2.49
93.67
Number of shares
385,422,400
385,422,400
385,422,400
The Government of Romania mandated the state representatives in the General Meeting of
Shareholders/the Board of Directors of the national societies, national companies and majority
or entirely state owned companies and the autonomous administrations, to take all the
necessary measures for the distribution of a minimum share of 90% of net profit
accomplished in 2016 (as dividends/payments) to the state budget.
The Government took this decision through a Memorandum adopted at the meeting of
January 27, 2017.
Page 62 of 98
Board of Director’s Report 2016
Since January 1, 2013, the Board of Directors underwent several changes, bearing in mind
that in 2013 the Government Emergency Ordinance no.109/November 30, 2011 on corporate
governance in state-owned enterprises was implemented within the company, as regards the
selection and appointment of members in the board of directors based on a cumulative voting
procedure, and the number of the members of the board was increased from 5 to 7.
The members of the Board of Directors as of December 31, 2016 are as follows:
Name
Item
No
Institution of employment
Position in the
Board
Status
1
2
3
4
5
6
7
Chisalita Dumitru
Universitatea “Transilvania” Braşov Chairperson
Negrut Aurora
Ministry of Energy
Jansen Petrus Antonius
Maria
Associate Lecturer London School
of Business and Finance
Tcaciuc Sebastian Gabriel
SC Auris Capital SRL
Jude Aristotel Marius
Ministry of Energy
Stoicescu Razvan Florin
Musat&Asociatii SPARL
Buzatu Florin Danut
Societatea de Investitii Financiare
Transilvania
Member
Member
Member
Member
Member
Member
non-
independent
non-
independent
independent
independent
non-
independent
independent
independent
*)- members of the Board of Directors submitted the independent statements in compliance with the provisions of Romgaz
Corporate Governance Code.
During 2016, the Board of Directors underwent the following changes:
- On February 22, 2016, Mrs. Sorana Baciu resigned from Romgaz Board of Directors,
and Mr. Sebastian-Gabriel Tcaciuc was appointed member on an interim basis
pending full appointment at the following Ordinary General Meeting of the
Shareholders of March 25, 2016 (OGMS).
- The mandate of Mr. Dragoş Dorcioman expires on March 25, 2016
- By Resolution No 3/March 25, 2016 of the Ordinary General Meeting of Shareholders
Mr. Jude Aristotel-Marius was appointed as member of the Board on the position left
vacant by cease of mandate of Mr. Dorcioman Dragoş.
- By Resolution no. 3/March 25, 2016 of the General Meeting of Shareholders, Mr.
Tcaciuc Sebastian-Gabriel was appointed as member of the Board.
- By Resolution no. 10/November 15, 2016, of the General Meeting of Shareholders,
Mr. Buzatu Florin Danut was appointed as member of the Board, bu cumulative vote;
- By Resolution no. 10/November 15, 2016 of the General Meeting of Shareholders,
Mr. Stoicescu Florin- Razvan was appointed as member of the Board, by cumulative
vote;
- By Resolution no.10/November 15, 2016 of the General Meeting of Shareholders, Mr.
Metea Virgil-Marius and Mrs. Popescu Ecaterina were revoked from position for
nonconformity as regards the cumulative vote.
Page 63 of 98
Board of Director’s Report 2016
The CVs of the current directors are to be found on the company’s webpage www.romgaz.ro
at the section “Investor Relations – Corporate Governance – Board of Directors”.
to
the
According
information supplied by each director, there is no agreement,
understanding or family relationship between them and another person that contributed to
their appointment as directors.
As of December 31, 2016 the following members hold shares within the company:
No
Name and Surname
Number of shares
held
0
1
2
1
Tcaciuc Sebastian Gabriel
Buzatu Florin Dănuţ
2
33.000
3.000
Weight
in the share capital
(%)
3
0.00856203
0.00077837
Virgil Marius Metea - Director General (CEO)
By Resolution no. 8 of June 12, 2013 the Board of Directors appointed Mr. Virgil Marius
Metea as director general and delegated internal management powers and representation
competences to him. The Mandate Contract was concluded on a 4 year period (12 June 2013-
13 June 2017) and can be renewed by addendum further a resolution of the Board of
Directors.
The table below shows the management positions to which the Board of Directors did not
delegate managing powers:
Name
ROMGAZ - headquarters
Rotar Dumitru Gheorghe
Dobrescu Dumitru
Bobar Andrei
Chertes Viorel Claudiu
Cindrea Corin Emil
Ciolpan Vasile
Ştefănescu Dan Paul
Terciu Iulian Ermil
Stancu Lucian Adrian
Bodogae Horea Sorin
Pavlovschi Vlad
Balasz Bela Atila
Morariu Dan Nicolae
Bîrsan Mircea Lucian
Sorescu Eugen
Medias Branch
Man Mihai Ioan
Achimeţ Teodora Magdalena
Şutoiu Florinel
Seician Daniel
Position
Deputy Director General
Deputy Director General
Chief Financial Officer
Management Support Director
Quality, Health, Safety and Environment Director
Energy Trade Director
Exploration-Production Director
Human Resources Management Director
Corporate Management Director
Procurement Direction Director
Business Development Director
Energy Management Director
Information Technology and Telecommunication Director
Technical Director
Exploration Director
Director
Economic Director
Production Director
Technical Director
Page 64 of 98
Board of Director’s Report 2016
Tîrgu Mureş Branch
Dinca Ispasoan Ioan
Caraivan Viorica
Rusu Gratian
Baciu Marius Tiberiu
Ploieşti Branch
Cârstea Vasile
Ionescu Viorica Maria
Vecerdea Dan Adrian
Iernut Branch
Bircea Angela
Vlassa Susana Ramona
Oprea Maria Aurica
David Ştefan
SIRCOSS
Stancicu Sorin
Bordeu Viorica
Gheorghiu Sorin
STTM
Pop Traian
Ilinca Cristian Alexandru
Cioban Cristian Augustin
Director
Economic Director
Production Director
Technical Director
Director
Economic Director
Storage Director
Director
Economic Director
Commercial Director
Technical Director
Director
Economic Director
Technical Director
Director
Economic Director
Operation-Development Director
According to the Articles of Incorporation, appointment and dismissal of executive directors
is made by the Board of Directors; “executive director” means “the person to whom the Board
of Directors delegated competences to manage the Company” – Article 24, paragraph (15).
The members of the executive management, except the director general, are employees of the
company, having an individual labour contract for an indefinite period.
The management and operating personnel are employed, promoted and dismissed by the
director general based on the competences delegated to him by the Board of Directors.
According to our information, there is no agreement, understanding or family relationship
between the members of the executive management and another person that contributed to
their appointment as members of the executive management.
The table below shows the number of shares held by the members of the executive
management as of December 31, 2016:
Item
no.
0
1
2
3
4
5
6
Name and Surname
Number of shares held
Weight in the capital share (%)
1
Rotar Dumitru Gheorghe
MeteaVirgil Marius
Baciu Marius Tiberiu
Ştefănescu Dan-Paul
Cârstea Vasile
Stăncicu Sorin
2
15,611
5,513
1,485
601
412
76
3
0.00405036
0.00143038
0.00038529
0.00015593
0.00010690
0.00001972
Page 65 of 98
Board of Director’s Report 2016
7
8
9
10
11
Ilinca Cristian Alexandru
Morariu Dan Nicolae
Dincă Ispasian Ioan
Vecerdea Dan Adrian
Balasz Bela Atila
74
52
48
45
38
0.00001920
0.00001349
0.00001245
0.00001168
0.00000986
To the best of our knowledge, the persons mentioned at 6.1 and 6.2 above, have not been
involved in litigations or administrative proceedings related to their activity in Romgaz in
the last 5 years, nor in proceedings related to their capacity of fulfilling the duties.
Page 66 of 98
Board of Director’s Report 2016
The individual financial statements of the Company have been prepared in accordance with
the provisions of the International Financial Reporting Standards (IFRS) as adopted by the
European Union and provisions of PFM Order no. 2844/2016. For the purposes of the
preparation of these individual financial statements, the functional currency of the Company
is deemed to be the Romanian Leu (RON). IFRS, as adopted by the EU, differs in certain
respects from IFRS as issued by the IASB. However, the differences have no impact on the
Company’s individual financial statements for the years presented.
The individual financial statements have been prepared on a going concern basis in
accordance with the historical cost convention.
The table below presents a summary of the statement of individual financial position as of
December 31, 2016:
Indicator
31.12.2014
31.12.2015
31.12.2016
(RON
thousand)
(RON
thousand)
(RON
thousand)
Variance
(2016/2015)
0
1
2
3
4=(3-2)/2*100
Assets
Non current Assets
Property, plant and equipment
Other intangible assets
Subsidiaries
Associates
Other Financial Investments
Other non-current assets
Total non-current assets
Current Assets
Inventories
Trade and other receivables
Other financial assets
Other Assets
Cash and cash equivalents
Total current assets
TOTAL ASSETS
EQUITY AND LIABILITIES
Capital and reserves
Share capital
Reserves
Retained earnings
Total capital and reserves
Non current liabilities
5,962,719
407,449
-
738
76,889
-
6,447,795
392,108
1,000,195
2,343,864
101,886
526,256
4,364,309
10,812,104
5,996,460
399,859
1,200
163
70,080
29.300
6,497,062
559,784
601,065
2,146,827
139,612
740,352
4,187,640
1,.684,702
5,789,262
397,864
1,200
120
69,657
-
6,258,103
575,983
828,610
2,892,751
141,525
280,526
4,719,395
10,977,498
385,422
2,142,347
7,184,249
9,712,018
385,422
2,581,853
6,724,947
9,692,222
385,422
3,020,152
6,270,587
9,676,161
-3.46%
-0.50%
0.00%
-26.38%
-0.60%
-
-3.68%
2.89%
37.86%
34.75%
1.37%
-62.11%
12.70%
2.74%
0.00%
16.98%
-6.76%
-0.17%
Retirement benefit obligation
Deferred tax liabilities
97,265
131,305
102,959
62,589
119,986
40,123
16.54%
-35.89%
Page 67 of 98
Board of Director’s Report 2016
Provisions
Total non current liabilities
0
Current liabilities
Trade and other payables
Current tax liabilities
Income in advance
Provisions
Other liabilities
Total current liabilities
Total liabilities
202,293
430,863
2
200,855
194,048
-3.39%
36,.403
3
354,157
3
-3.34%
4=(3-2)/2*100
216.983
93.590
-
35.814
322.836
669.223
1.100.086
186.937
90.838
-
28.779
319.523
626.077
992.480
569.941
60.295
4,924
50.437
261.583
947.180
1.301.337
20488%
-33.62%
-
75.26%
-18.13%
51.29%
31.12%
2.74%
TOTAL EQUITY AND LIABILITIES
10.812.104
10.684.702
10.977.498
Non-current assets
The total non-currents assets decreased by 3.68% (i.e. RON 239.0 million) due to the net
depreciation and amortization of fixed assets lower than the investments in new assets.
Moreover, on December 31, 2016, the company did not have bank deposit with a maturity
date over one year, explaining the decreasing of the line “Other financial assets”.
Current assets
The current assets increased by 12.7% as compared to the previous year, as follows:
- Trade receivables increased by 37.86%, compared to December 31, 2015 as a result of
the improvement of the policy on reducing the credit risk related to sales made by the
Company. Therefore, the company concluded gas sale contracts that are secured either
by the advance payment of deliveries, or by letters of bank guarantees. As a result, the
impairment related to sales decreased in 2016 as compared to the previous year, the
most significant allowance being recorded further in invoicing penalties to a client that
became subsequently insolvent.
- Other financial assets, cash and cash equivalents recorded an increase by 8.8% as
compared to the previous year and include cash in bank deposits, fixed-term deposits
and government securities;
Capital and reserves
As of December 31, 2016, Company reserves increased by RON 438.30 million as a result of
allocating a share of the 2015 net profit (RON 335.94 million) to the development fund of the
Company and a share of the current period profit (RON 83.26 million), following
implementation of the fiscal facilities, in accordance with Law 227/2015 on the Fiscal Code.
Retained earnings decreased by RON 454.36 million, further to allocating the previous years’
net profit to the destinations approved by the GMS, the positive effect being generated by the
value of 2016 net profit.
Non-current liabilities
Non-current liabilities decreased as of December 31, 2016 compared to the previous year
mainly due to a decrease of the deferred income tax liability. The deferred income tax is
calculated in compliance with the requirements of the International Financial Reporting
Standards and it is not a chargeable liability.
Page 68 of 98
Board of Director’s Report 2016
The provision for benefits granted for retirement and other benefits has been updated on
December 31, 2016 by actuarial methods. The increase by RON 17.03 million is due to
renegotiating the Collective Labour Agreement applicable at the Company.
Current liabilities
Trade payables and other payables increased on December 31, 2016 by 204.88 % as
compared to the previous year following the increase of the advances paid by clients for the
gas deliveries. At the time the gas balance for November and December 2016 will be finalized
these advances will be settled with the invoices issued to the clients for the two months (trade
liabilities record the estimated income for the two months in amount of RON 698.37 million).
Short term provisions have increased by RON 21.66 million as of December 31, 2016 as a
result of recording the profit share payable to employees. This liability has been recorded in
2015 at “Other Liabilities”.
The decrease of other liabilities as of December 31, 2016 by 18.13%, namely RON 57.94
million is due to the decrease of liabilities related to the tax on additional revenue obtained
further to the deregulation of prices in the gas sector, the decrease of the petroleum royalty
and the liabilities related to output VAT.
The Company did not issue bonds or other debt instruments during the 2016 financial
year.
The statement of comprehensive income for the period January 1 – December 31, 2016, as
compared to the similar period of the years 2015 and 2014, is shown below:
Indicator
0
Revenue
Cost of commodities sold
Investment income
Other gains and losses
Changes in inventory of finished
goods and work in progress
Raw materials and consumables
used
Depreciation, amortization and
impairment
Year
2014
(thousand
RON)
1
4,493,341
Year
2015
(thousand
RON)
2
4,052,684
(175,638)
(40,228)
78,729
44,185
(275,141)
(318,903)
Year 2016
(thousand RON)
3
3,411,868
(49,878)
22,117
(468,218)
27,743
138,181
20,963
Variance
(2015/2016)
4=(3-2)/2*100
-15.81%
23.99%
-49.94%
46.82%
-84.83%
(66,167)
(78,262)
(54,632)
-30.19%
(776,839)
(793,598)
(311,021)
-60.81%
Employee benefit expense
(522,785)
(511,647)
Finance cost
Exploration expense
Other expenses
Other income
Profit before tax
Income tax expense
Profit for the year
(24,476)
(43,332)
(20,302)
(42,395)
(1,034,627)
(1,040,670)
107,521
79,793
1,788,329
1,468,838
(378,448)
(274,553)
1,409,881
1,194,285
(498,114)
(18,275)
(253,348)
(881,923)
361,147
1,280,695
(256,116)
1,024,579
-2.64%
-9.97%
497.59%
-15.25%
352.60 %
-12.81%
-6.72%
-14.21%
Page 69 of 98
Board of Director’s Report 2016
Revenue
In 2016, Romgaz achieved revenue of RON 3.41 billion, as compared to RON 4.05 billion
achieved in 2015, lower by 15.81% due to negative influence of weather condition, drastic
decrease of gas demand in the key sectors, competition against import gas and unfavourable
fiscal framework for competition on the natural gas market.
Cost of Commodities Sold
In 2016, cost of commodities sold increased by 23.99%, due to an increase by 9.8% of the
cost of commodity gas sold and the increase by 33% of costs generated by negative
imbalances on electricity balancing market.
Investment Income
In 2016, investment income decreased by 49.94%, to RON 22.12 million, compared to RON
44.12 million in 2015, driven by the reduction of interest rates of the cash placed in bank
deposits and state bonds.
Other Gains and Losses
In 2016 the Company estimates a net loss of RON 468.22 million mainly as a result of
recording allowances for doubtful debts as regards one of the Company’s most important
customer. Following entering into insolvency of that customer, in order to conduct the
insolvency proceedings and to protect the Company’s interests, in 2016 penalties for late
payments were invoiced; these penalties were won in court in accordance with a non-final
court decision, and they relate to receivables that were paid off in kind in 2013. Bearing in
mind the uncertainty of cashing such amount, an equivalent allowance for doubtful debts was
created that offsets the income from penalties invoiced to that customer. The income from
such penalties is included in “Other Income”.
Other Gains and Losses also include the loss from write-off of fixed asset amounting to RON
108.06 million. This loss is compensated by the resuming at income the impairment set up for
these assets over the previous periods, the effect in the result of the reviewed period being
insignificant. Resuming the impairment for fixed assets at income is reflected in Depreciation,
Amortization and Impairment.
Another influence on the estimated loss of RON 468.22 million is due to payment of some
amounts further to ANAF investigation (National Agency for Fiscal Administration) carried
out in 2014. The control was conducted on income tax for the period 2008 – 2013 and VAT
for the period 2009–2013. Following this investigation and the complaints submitted by the
Company, the amount to be paid was of RON 18.85 million. By Q3 2016, the Company set
up a provision for litigations in amount of RON 15.87 million and such the amount was paid
only in Q4 2016. In 2015, the Company sued ANAF, and on the date of publishing the
preliminary results for 2016 the process was under trial. Considering these aspects and the
fact that the Company regards the payment made as not due, in Q4 2016 a receivable of RON
18.85 million was recorded and impairment for the same value was registered due to ongoing
litigation. Such loss is partially annulled by resuming at income the provision for litigation in
amount of RON 15.87 million which is reflected at “Other Expenses”.
Changes in Inventory
Changes in inventory are estimated to have decreased in the year ended on December 31,
2016 as compared to the previous year, due to the following factors:
- the gas volumes injected in the storage during 2016 have been smaller by 43.8% as
compared to the volumes injected in 2015;
Page 70 of 98
Board of Director’s Report 2016
- gas volumes withdrawn from the storage in the current year have increased by 12.97% as
compared to the previous year;
Raw Materials and Consumables Used
In 2016, the estimated cost of raw materials has been lower than in the previous year, by
30.19% especially due to the decrease of expenses with fuel.
Depreciation, Amortization and Impairment
These expenses include expenses with depreciation of non-current assets in amount of RON
527.94 million (2015: RON 560.07 million) and net impairment income in amount of RON
216.93 million (2015: net impairment expenses of RON 233.53 million).
The decrease of expenses with depreciation is generated by the decrease of the natural gas
production during the analysed period, the production wells being depreciated depending on
the ratio between production and reserves.
As regards the net impairment income, it offsets the exploration expenses of RON 253.35
million representing exploration drilling projects abandoned in 2016 for which the Company
has set up impairments in the previous periods (the most significant exploration project refers
to abandoning Rapsodia block operated in partnership with Lukoil. The Decision of the
National Agency for Mineral Resources on the termination of the petroleum agreement for
exploration-development-production in EX-29 Est Rapsodia block has been published in the
Official Gazette in December 2016). Moreover, this net impairment income compensates the
loss from the write-off of tangible assets, as previously mentioned. Therefore, the effects of
abandoning the negative exploration drilling projects and the write-off of fixed assets
reflected in the financial results of the year are insignificant.
Exploration expense
In 2016 exploration expenses recorded an increase of 497.6% as compared to the previous
year. As mentioned at “Depreciation, Amortization and Impairment” the effect of these
expenses was offset by the reversal of the impairment set up in previous periods, the net effect
is a loss of RON 16 million.
Other Expenses
The breakdown of other expenses by elements of cost is shown in the table below:
Indicator
2014
(thousand
RON)
2015
(thousand
RON)
2016
(thousand
RON)
Variance (2016/015)
1
Electricity
Gas capacity booking
Other taxes and duties
Provisions
Other operating expenses
Total
2
20,755
40,427
3
18,472
40,574
4
16,964
37,449
(thousand
RON)
5=4-3
(1,508)
(3,125)
816,598
787,182
604,243
(182,939)
(4,093)
2,128
12,978
160,940
192,314
210,082
10,850
17,768
1,034,627
1,040,670
881,716
(158,954)
(%)
6=5/3x100
-8.16
-7.70
-23.24
509.87
9.24
-15.27
Page 71 of 98
Board of Director’s Report 2016
In 2016, other expenses recorded a decrease as compared to the previous year by 15.27%
reaching RON 881.71 million, as compared to RON 1,040.67 million in 2015. The decrease
of such expenses is due to the decrease of petroleum royalty expenses (decrease estimated at
RON 85.93 million) and of the tax on additional revenue, such revenues being obtained as a
result of deregulating prices in the gas sector (decrease estimated at RON 81.55 million) as a
result of reducing gas deliveries.
Other income
The company recorded in 2016 other income of RON 361.15 million, with 352.60% higher
than 2015 due to increase of late payment penalties invoiced to clients for not paying on due
date, the most significant amount relates to one of the Company’s largest customers. An
allowance has been set up for this amount considering the insolvency of such customer the
allowance has been reflected at “Other gains and losses”.
Income tax expense
Income tax expense in 2016 includes the current income tax expense in amount of
RON 278.58 million (2015: RON 343.27 million) and the deferred tax income in amount of
RON 22.47 million (2015: RON 68.72 million).
Decrease of the current income tax in 2016 as compared to 2015 is due to the profit decline.
Profit for the Year
Pursuant to the evolution of income and expense elements as above mentioned, in 2016 the
net profit of the Company decreased by RON 169.71 million that is by 14.21%.
Page 72 of 98
Board of Director’s Report 2016
Statements of cash flows recorded in the period 2014 – 2016 are shown in the table below:
INDICATOR
1
Cash flow from operating activities
Net Profit for the year
Adjustments for:
Income tax expense
Investment income
Interest expense
Unwinding of decommissioning provision
Interest revenue
Loss on disposal of non-current assets
Change in decommissioning provision recognized in profit
or loss, other than unwinding
Change in other provisions
Expenses for provisions for impairment of exploration assets
Exploration costs
Impairment of property, plant and equipment
Depreciation and amortization
Impairment of investment in associates
Impairment of other financial assets
Losses from trade receivables and other assets
Income from dismantling of assets
Write-down allowance of inventory
Movements in working capital
(Increase)/Decrease in inventory
(Increase)/Decrease in trade and other receivables
(Increase)/Decrease in trade and other liabilities
Cash generated from operations
Interest paid
Income tax paid
Net cash generated by operating activities
Cash flows from investing activities
Investments in affiliated parts
Investments in subsidiaries
(Increase)/Decrease in other financial assets
Interest received
Proceeds from sale of non-current assets
Loan granted to associates
Loans reimbursed by the associates
Dividends received
Collection from sales of other financial investments
Acquisition of non-current assets
Acquisition of exploration assets
Net cash used in financing activities
Cash flows from financing activities
Dividends paid
Net cash used in financing activities
Net Increase/(Decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
*thousand RON*
2014
2
2015
3
2016
4
1,409,881
1,194,285
1,024,579
378,448
(3,268)
34
24,442
(75,461)
18,024
(7,877)
3,783
154,077
43,332
137,783
484,979
209
11
-
233,340
-
21,907
2,823,644
50,008
(154,869)
95,160
2,813,943
(34)
(500,975)
2,312,934
-
-
(770,854)
77,200
154
-
-
1,634
-
(580,708)
(485,147)
(1,757,721)
274,553
-
34
20,268
(44,185)
23,084
(19,724)
21,852
228,309
42,395
5,219
560,070
1,328
6,809
-
292,146
(2,232)
(4,576)
2,599,635
(162,187)
54,550
(15,202)
2,476,796
(34)
(346,021)
2,130,741
(753)
(1,200)
158,050
53,872
42
(726)
65
1,634
-
(357,281)
(555,423)
(701,720)
256,116
-
15
18,260
(22,117)
108,057
(5,941)
18,919
(173,701)
253,348
(43,228)
527,941
43
(1,554)
1,577
354,321
(1,287)
5,714
2,321,062
(21,646)
(583,600)
337,707
2,053,523
(15)
(309,125)
1,744,383
-
-
(720,480)
25,178
144
-
-
-
400
(296,511)
(172,178)
(1,163447)
(988,287)
(988,287)
(433,074)
959,330
526,256
(1,214,925)
(1,214,925)
214,096
526,256
740,352
(1,040,762)
(1,040,762)
(459,826)
740,352
280,526
Page 73 of 98
Board of Director’s Report 2016
Corporate governance accommodates continuously to the requirements of a modern
economy, to increasing globalization of social life and to investors and interested parties need
for information on companies business.
Government Emergency Ordinance (OUG) No. 109 of November 30, 2011 on public
companies corporate governance, as amended and supplemented (the “Ordinance”) and
Government Decision no. 772 of September 28, 2016 on Methodological Norms for
establishing the financial and nonfinancial performance criteria and variable component of
remuneration of the members of the Board of Directors, or if applicable, the supervision of
enterprise, and of directors and members of directorate, respectively, applies to Romgaz, as
national company.
The Ordinance sets up a number of principles and provisions to ensure their application.
Principles included in the Ordinance are as follows:
Clear separation of authorities deriving from shareholder from those deriving
from directorship/managing of the company.
Principle of transparency, non-discrimination and equal treatment in the selection
process of Board members;
Principle of proportional representation in the Board of Directors;
Minority shareholders protection by observing transparency principles;
Transparency principle;
Principle of mandatory reporting to the GMS as prescribed by law.
Ordinance provisions are observed by the company, and are included in the Company’s
Articles of Incorporation, as amended and approved by the company’s shareholders
Resolution No. 19 of October 18, 2013 and respectively by Resolution No. 5 of July 30, 2014,
and Resolution No. 8 of October 29, 2015 (latest update of the Articles of Incorporation).
The updated Company’s Articles of Incorporation is posted on the internet webpage
www.romgaz.ro, at the section dedicated to “Investor Relations – Corporate Governance”.
Since November 12, 2013, Romgaz shares have been traded on the regulated market governed
by BVB, at category I, under the symbol “SNG”, as well as on the London Stock Exchange
(where GDRs are traded) under the symbol “SNGR”.
On January 5, 2015, after the Financial Supervisory Authority approved the proposals to
amend BVB’s regulations, Romgaz was admitted into the PREMIUM category of BVB
regulated market.
As issuer of securities traded on the regulated market, Romgaz has to fully comply with the
corporate governance standards provided by applicable national regulations, namely the
Corporate Governance Code of BVB, posted on the internet webpage www.bvb.ro, at the
section dedicated to “Investor Relations – Regulation-BVB Regulation”.
The corporate Governance System was and will be improved according to rules and
recommendations applicable to Companies listed on Bucharest Stock Exchange and on
London Stock Exchange.
Page 74 of 98
Board of Director’s Report 2016
Some of the already implemented measures include:
Elaboration of a new Corporate Governance Code, in accordance with the new Corporate
Governance Code of BVB applicable since January 4, 2016 – the document was approved
by Romgaz Board of Directors by Resolution no.2/ January 28, 2016; The Corporate
Governance Code has been updated and shall be submitted for approval in a Meeting of
the Board of Directors subsequent to March 23, 2017.
The Company’s Articles of Incorporation
www.romgaz.ro, at
the section dedicated
Governance”.
internet webpage
is posted on
to “Investor Relations – Corporate
the
Board of Directors approval and update of the internal Rules for the advisory committees
during the meetings held on March 24, 2016 and June 23, 2016. At the end of the year
2016, internal Rules for the advisory committees have been updated in order to include the
latest legal modification regarding corporate governance (Law 111/2016 and Government
Decision no. 722/2016). The updated version of the rules of the Strategy Committee was
approved by the Board of Directors in the meeting of March 23, 2017, the updated
versions of the rules of the other committees shall be submitted for approval in a
subsequent meeting.
Update of the Board of Directors Organization and Operating Regulation in order to
include the legal modification on corporate governance. The regulation was approved by
the Board of Directors on March 23, 2017;
Elaboration of internal regulation in compliance with the new Corporate Governance
Code of BVB. Part of the regulations were approved by the Board of Directors on March
23, 2017 (Policy regarding Dividends and the Policy regarding Forecasts) the other
regulations will be approved in a subsequent meeting;
Inclusion in the Board’s Annual Report of a chapter dedicated to corporate governance
referring, among others, to : the applicable Corporate Governance Code, the duties of the
executive management and of the three advisory committees of the Board of Directors
(Nomination and Remuneration Committee and Audit Committee and the Strategy
Committee), aspects related to remuneration of members of the Board and of directors,
measures to improve the corporate governance, aspects related to internal control and risk
management system and aspects related to social responsibility;
Inclusion in the Board’s Annual Report of a section referring to compliance with the
provisions of BVB Corporate Governance Code (Annex 2);
Diversify communication ways with shareholders and investors by posting on the website
announcements addressed to market players, half year and quarterly financial statements,
annual reports, procedures to follow for access and participation to GMS, and by setting
up of an “Infoline” for shareholders/investors to respond to their requirements and/or
questions;
Establish of a specialized department dedicated to investor and shareholder relations;
Conclusion of professional liability insurance for directors and managers and appointment
of a person to monitor such contracts.
Starting the procedures necessary for the adopting and implementing the National
Anticorruption Strategy. Therefore, a Commission has been established, responsible with
the implementation of the strategy provisions; the Director General has adopted the
Statement of Adherence to the National Anticorruption Strategy and Plan of Integrity,
Page 75 of 98
Board of Director’s Report 2016
documents which have been posted on the internet website at the section dedicated to
“Public Information- Transparency”;
Some of the measures to be implemented include:
a set of rules on trading of shares by directors or other individuals;
a remuneration policy for the management members, which should include a fixed
component and a variable component to depend on the results of their assessment.
According to London Stock Exchange Corporate Governance Code long term bonus
schemes should be approved by GMS.
The shareholders structure is described within Chapter II “Romgaz at a glance”
Romgaz respects and protects the rights and legitimate interests of shareholders. The
Company undertakes all the necessary efforts to facilitate the exercitation of shareholders’
rights, under the law and in compliance with the Articles of Incorporation.
The General Meeting of Shareholders is called by the Board of Directors, whenever
necessary, in accordance with the legal provisions. The convening notices and the GMS
resolutions are sent to Bucharest Stock Exchange, London Stock Exchange and to the
Financial Supervisory Authority in compliance with the regulations of the capital market and
will be published on the company’s website at Investor Relations – General Meeting of
Shareholders.
The Ordinary General Meeting of Shareholders has the following main competencies:
a) to approve the company’s strategic objectives;
b) to discuss, approve or amend, as the case may be, the annual financial statements of
the company based on the reports submitted by the Board of Directors and the
financial auditor, and to set the dividends due to shareholders;
c) to discuss, approve or request, as the case may be, the addition or review of the
company’s management plan, under legal provisions.
d) to set the income and expenditure budget for the following financial year;
e) to appoint and to dismiss the Board members and to set their remuneration;
f)
g) to appoint and to dismiss the financial auditor and to set the minimum term of the
to make an opinion on the management of the Board members;
financial audit contract;
h) to decide with respect to contracting bank loans with an individual or cumulated value
with other bank loans in progress over a financial year of EUR 100 million, equivalent
in RON;
i) approval of documents for establishing guarantees, other than guarantees for the
company’s non-current assets, with individual or cumulated value with other
established guarantees other than guarantees in progress for the company’s non-
current assets over a financial year of EUR 50 million, equivalent in RON.
The Extraordinary General Meeting of Shareholders has the following main competencies:
a) to change company’s legal form;
b) to move the headquarters;
c) to change the company’s scope of activity;
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Board of Director’s Report 2016
d) to incorporate and to conclude or amend incorporation documents of the companies
where Romgaz is managing partner;
to increase the share capital;
the anticipated winding up of the company;
to convert shares from a category into the other;
e) to conclude or amend joint venture contracts where the company is contracting party;
f)
g) to reduce the share capital or to restore it by issuing new shares;
h) to merge with other companies or to spin-off the company;
i)
j)
k) to convert one category of bonds into another one or in shares;
l)
m) to conclude the documents related to the acquisition of non-current assets whose value
exceeds, separately or cumulatively, during a financial year, 20% of the total non-
current assets of the company, except for receivables;
to issue bonds;
n) to conclude the documents related to disposal, exchange and set up of guaranties
referring to non-current assets whose value exceeds, separately or cumulatively,
during a financial year, 20% of the total non-current assets, except for receivables;
o) to conclude the documents related to rental for a period longer than 1 (one) year of
tangible assets to the same contractors or to persons involved or acting together,
whose value exceeds, separately or cumulatively, 20% of the total tangible assets,
except for receivables at the document conclusion date;
p) any other change in the articles of incorporation or any other resolution that requires
the approval of the extraordinary general meeting of shareholders.
Romgaz is governed under an one-tier system by a Board of Directors consisting of 7 (seven)
directors. The board members are elected by the general meeting of shareholders, in
compliance with legal applicable provisions and the provisions of the Articles of
Incorporation.
The majority of the Board members must consist of non-executive and independent directors
and, at least one of them, must have a degree in economics and at least 5 years of experience
in economics, accounting, audit or financial area.
In accordance with provisions of Article 28, paragraph (3) of the Ordinance „At least two
members of the Board of Directors must have a degree in economics or law and at least 5
years experience in economics, law, accounting, audit or financial area”.
The board members of the company on December 31, 2015 are mentioned in Chapter VI
“Management”. According to the independent statements submitted to the company, four of
the members of the Board have declared themselves as independent and three as non-
independent. The independence of members of the Board of Directors is determined based on
the criteria detailed in Corporate Governance Code of Romgaz (Article 6).
The Board of Directors has the following basic competencies which cannot be delegated to
executive directors:
a) to set the core business and development directions of the company;
b) to approve the Company Management Plan;
c) to set the accounting policies, the financial control and financial planning system;
d) to appoint and dismiss the executive directors, including the Director General and to
establish their remuneration;
e) to control the executive directors’ activity;
f)
g) to organise the General Meeting of Shareholders, and to enforce their resolutions;
to draft the annual report of the Board of Directors;
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Board of Director’s Report 2016
h) to file for insolvency prevention and for the insolvency of the company;
i)
to draft rules for its own activity, for the activity of the GMS and that of the advisory
committees and of the management, without contradicting the legal provisions or the
Articles of Incorporation;
incorporation or dissolution of secondary offices (branches, agencies, work points or
any other locations);
j)
k) granting project bonds with values not exceeding, individually or cumulatively with
other project bonds in progress, EUR 100 million, equivalent in RON;
l) granting loans to companies where Romgaz is shareholder for a value not exceeding,
individually or cumulatively with other loans alike in progress, EUR 50 million,
equivalent in RON;
m) other competencies of the Board of Directors that cannot be delegated, according to
the law.
The Board of Directors convenes whenever necessary, but at least once every three months.
Board meetings may be convened by the Chairman or upon the reasonable request of at least
2 directors or of the Director General. For decisions to be valid, it is necessary that the
majority of the Board members participate in the meeting and the decision has to be made by
majority of the votes validly casted. If a director has, directly or indirectly, interest in a certain
business, contrary to the company’s interests, the director has to inform the other directors
and the internal auditor of such matter and he/she will not take part in any discussion related
to such business. This obligation also is valid when the Director is aware that the husband,
wife, relatives or in-laws up to the IVth degree inclusively are interested in such business. A
minute will be drafted after each Board meeting underlying the resolution of the Board that
will include all decisions made in the meetings.
In December 2015, the Board of Directors made its first self-assessment. The result of the
self-assessment outlined the following main directions to be improved: strategy, risk
management, communication, transparency, investor relations. Some of the measures to be
included in the Action Plan are:
- drafting, approval and implementation of anticorruption strategy in the
company;
reviewing the Board’s and Advisory Committees’ rules, a measure imposed by
the new Corporate Governance Code of the company;
setting the company strategy implementation methodology and drafting a plan
of measures for fulfilling strategic objectives;
implementing a centralised risk management system.
-
-
-
Until December 31, 2016 the Board of Directors did not make a self- assessment for the year
2016.
In its activity, the Board of Directors is supported by three advisory committees, namely: the
nomination and remuneration committee, the audit committee and the strategy committee.
The Audit Committee has legal competencies provided in Article 47 of GEO No. 90/2008
related to statutory audit of annual financial statements, which consist mainly in monitoring
the financial reporting process, the internal control, the internal audit and risk management
systems within the company, as well as in controlling the statutory audit activity related to
annual financial statements.
Page 78 of 98
Board of Director’s Report 2016
The Nomination and Remuneration committee has, basically, the competence to evaluate
beforehand and to recommend candidates as members of the Board of Directors and as
executive directors, and it can be assisted in this approach by an independent expert
specialized in human resources recruitment. As related to remuneration, the main duty of the
committee is to elaborate an annual report on the remunerations and other benefits given to
directors and executive directors during the financial year, report that is presented to the
General Meeting of Shareholders which approves the annual financial statements (according
to Article 55, paragraph (2) of GEO No. 109/2011).
Main Responsibilities and Duties of the Nomination and Remuneration Committee are as
follows:
advances proposals for director positions, including the position as Chairperson of the
Board of Directors;
drafts and submits the candidates selection process for executive director;
recommends candidates for executive director positions;
submits proposals for remuneration of executive directors;
other responsibilities as established by the Board of Directors or as provided by law.
Main Responsibilities and Duties of the Audit Committee are as follows:
coordinates the activity of the internal audit;
coordinates the selection activity of the statutory auditor or of the audit firm and issues the
recommendation for appointment of a statutory auditor or of an audit firm;
verifies and monitors the independence of the statutory auditor or of the audit firm;
monitors the financial reporting process;
monitors the effectiveness of internal control, internal audit and risk management systems;
endorses the annual and multiannual internal audit plan;
endorses the internal audit reports and recommendations formulated by the internal
auditors;
monitors the statutory audit of annual financial statements and of consolidated annual
financial statements;
other responsibilities as established by the Board of Directors or as provided by law.
Main Responsibilities and Duties of the Strategy Committee are as follows:
reviews and/or endorses the development strategy of the company and endorses the
annual plan for average term (3 years) for implementation of the strategy elaborated
by the executive management;
analyses the proposals elaborated by the executive management regarding the
investment plan, related to strategic proposals, to include the projection of the income
and expenditure budget and to make recommendations and to endorse the investment
Page 79 of 98
Board of Director’s Report 2016
plan afferent to strategic proposals, including the implementation mode of the strategic
objectives;
assists the Board of Directors in fulfilling its responsibilities to elaborate and update
the general development strategy of the company;
analyses the opportunities identified by the executive management regarding the
business development and issues recommendations of the Board of Directors as far as
regards the identified opportunities.
On December 31, 2016, the advisory committees’ structure was the following:
I) Nomination and Remuneration Committee:
Tcaciuc Sebastian Gabriel (chairman)
Negrut Aurora
Jansen Petrus Antonius Maria
Buzatu Florin Danut
Stoicescu Florin Razvan
II) Audit Committee
Jansen Petrus Antonius Maria (chairman)
Tcaciuc Sebastian Gabriel
Jude Aristotel Marius
Buzatu Florin Danut
Stoicescu Florin Razvan
III) Strategy Committee
Negruţ Aurora (chairperson)
Chisalita Dumitru
Tcaciuc Sebastian Gabriel
Jude Aristotel Marius
Buzatu Florin Danut.
Information regarding the Board of Directors’ meetings and the Advisory Committees during
2016
During 2016, the Board of Directors held a number of 32 meetings, in compliance with the
legal and statutory provisions, out of which:
14 meetings with effective meeting of the directors and
18 meetings by teleconference.
Page 80 of 98
Board of Director’s Report 2016
The attendance at the Board of Directors’ meetings:
Name and Surname
Chisalita Dumitru
Jansen Peter Antonius Maria
Negruţ Aurora
Metea Virgil Marius
Popescu Ecaterina
Buzatu Florin Dănuţ
Stoicescu Florin Răzvan
Dorcioman Dragoş
Jude Aristotel Marius
Baciu Sorana
Tcaciuc Sebastian Gabriel
Number of meetings in the
period:
III
20
IV
5
II
3
I
4
P
A
Ab
no. %
no. %
no. %
32
32
32
27
27
25
78,1
31
96,9
31
96,9
24
88,9
25
92,6
5
5
5
5
6
100,0
100,0
85,7
1
14,3
25
23
92,0
28
1
25,0
22
78,6
2
1
50,0
3,5
P = participation;
A= authorisation;
A = absence;
7
1
1
3
2
2
1
5
21,9
3,1
3,1
11,1
7,4
8,0
25,0
17,9
7
4
I
II
III
IV
period January 1st – 22 February;
period 23 February – 25 March;
period 26 March – 14 November
period 15 November – 31December
The attendance at Advisory Committees’ meetings:
Nomination and Remuneration Committee: 2 meetings
Name and Surname
Tcaciuc Sebastian Gabriel
physical attendance
2
Negrut Aurora
Popescu Ecaterina
Stoicescu Razvan Florin
Buzatu Florin Danut
2
1
2
1
Page 81 of 98
Board of Director’s Report 2016
Audit Committee: 5meetings
Name and Surname
Jansen Peter Antonius Maria
Chisalita Dumitru
Popescu Ecaterina
Jude Marius Aristotel
Tcaciuc Sebastian Gabriel
Buzatu Florin Danut
Stoicescu Razvan Florin
physical attendance
5
4
1
4
4
1
1
Strategy Committee: 3 meetings
Name and Surname
physical attendance
Chisalita Dumitru
Jude Marius Aristotel
Tcaciuc Sebastian Gabriel
Metea Virgil Marius
3
3
3
2
In compliance with the Articles of Incorporation “the Board of Directors shall assign, totally
or part of, the management competences of the Company to one or more executive directors,
appointing one of them as Director General” Article 24, paragraph (1), “executive director”
means “the person to whom the Board of Directors delegated authority to manage the
company” Article 24, paragraph (12).
The Board of Directors appointed Mr. Virgil Marius Metea as Director General and delegated
him the following responsibilities and duties:
A. Responsibilities and duties related to internal management:
approves the organization and functioning chart;
approves the Organization and Functioning Regulations as well as other internal
documents regulating the activity of the company related to its employees;
approves the employment, promotion and dismissal of employees;
approves the responsibilities and duties of the employees;
approves the disciplinary reward and sanction of the employees;
approves the specific operations necessary and useful for achieving the scope of
activity;
fulfils any accessory duties, namely any acts and special operations necessary and
useful for achieving the above mentioned duties ;
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Board of Director’s Report 2016
B. Responsibilities and duties related to the representation of the company:
represents the company when concluding/issuing legal documents;
represents the company in pre-contractual, administrative and/legal procedures;
fulfills any accessory duties, namely any acts and special operations necessary and
useful for achieving the above mentioned duties.
The Director General must inform periodically the Board of Directors on the manner of
achieving the assigned duties, as well as the right to request and to obtain instructions on the
manner of exercising the assigned duties
The 2016 Annual Plan draft, together with the supporting documents, were submitted for the
Director General’s approval on December 8, 2015, under no. 34.504
The company’s activities review was the starting point of the Annual Plan. The risks affecting
the company’s activities and the relating risk assessment were also included in the Annual
Plan. Risk assessment factors/criteria were set by taking into account the recommendations
for the following 5 factors contained in Romgaz General Internal Audit Norms:
internal control assessment;
quantitative assessment;
qualitative assessment;
legislative amendments;
personnel service time.
The calculation methodology of the time available for the annual internal audit plan –
according to the form coded by the internal procedure 18F-24, shows that there are:
252 days as total available calendar days;
170 days as days available for internal audit missions.
In compliance with the law, the remaining 82 days are used for other internal audit activities:
annual reports, annual and strategic planning of the internal audit quality improvement
program, professional training and other requirements made by the management etc.
The 2016 Audit Plan includes 3 conformity/regularity audit missions:
Gas sale activity (February 1st - May 13, 2016);
Activity related to completion of the formalities necessary for carrying out the
relationship with capital market (23 May - July 25,2016);
Non-current assets inventory activity (September 1st - November 14, 2016).
The audit mission for 2016, until December 31 were the following:
I. Assurance mission for Sales Activity
The main objectives are:
Assessment of internal control system
Actual performance of the gas sale activity
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Board of Director’s Report 2016
To improve the gas Sale activity, the internal auditor team drafted 10 recommendations in
Audit Report no.15197/ June 07, 2016.
II. Assurance mission for the Activity related to completion of the formalities necessary for
carrying out the relationship with capital market
The main objectives are:
Assessment of Internal Control System (at the level of Capital Market Office)
Actual performance of the activity (within Capital Market Office);
Aspects related to compliance with the principles of Corporate Governance)
To improve the activity of fulfilment the necessary formalities for carrying on the relationship
with capital market, the internal auditor team drafted 55 recommendations in the Audit Report
no. 27202/ October 17, 2016
III. Assurance Mission for fixed assets inventory activity
The main objectives of the mission are:
Organizing the fixed assets inventory activity
Identifying the number of inventories and carrying out the inventory activity
Recording the results of inventory in the accounting
Verifying the methodology of decommissioning of fixed assets
Sale of decommissioned fixed assets
To improve the fixed assets inventory activity, the internal auditor team drafted 55
recommendations in the Audit Report no. 5815/ February 27, 2017
The internal audit plan for 2016 was achieved 100%.
IV. Advisory Mission and performance of other actions
In 2016 three ad hoc missions have been performed:
Verification and resolution of intimation no. 5046/February 22, 2016 made by SC
Adetrans SRL;
Opinion related to aspects observed by the Court of Auditors on natural gas sale in the
Control Report no 12444/May 06, 2016
Manner of carrying out the public procurement procedure for the contract “Renewal of
the centralized licensing contract Microsoft (E.A.)”
In 2016, two internal auditors were part of mixed Commission of verification/assessment of
some circumstances occurred at Targu Mures Branch and S.T.T.M. Targu Mureș.
Page 84 of 98
Board of Director’s Report 2016
Company’s Policies and Objectives related to Risk Management
In accordance with the Corporate Governance Code, one important role played by the
company’s management is to ensure that an efficient risk management system is in place.
One major concern of the management is to raise the awareness on the objectives of the risk
management process, the necessity of direct implication in the risk management process, as
well as the alignment to the latest practices in the sector by complying with the effective laws,
standards and norms related to such process.
The company’s risk management system is implemented in accordance with:
the Order of the Ministry of Public Finance no. 400 of June 12, 2015 for approval of
the internal / managerial control Code
Government Ordinance no.119/1999 (Article 4) on the internal control and the
preventive financial control;
Law no. 234 of December 7, 2010 amending and supplementing Order no. 119/1999,
International Standard ISO 31010:2009: “Risk management – risk assessment
techniques”;
International Standard
ISO 31000:2009: “Risk management/Principles and
guidelines”;
Romanian Standard SR Guidelines 73:2009: “Risk management-Vocabulary”.
Consequently, in compliance with the risk management process, the company systematically
analyses, at least once a year, the risks related to its objectives and activities and prepares
adequate remedy plans in order to mitigate the possible consequences of such risks, and
appoints employees responsible for implementing those plans.
Moreover, the risk management system implemented within the company is an integral part of
the decision making process by setting the requirement to use a risk management analysis
when drafting any and every complex document, at the headquarters as well as the branches
(technical projects related to the execution of investment objects; execution projects,
assessment studies of geological).
The main benefit of the risk management process is the improvement of the company’s
performance by identifying, analysing, assessing and managing all risks within the company,
in order to minimize the negative risk consequences or to increase the positive risk
consequences, as the case may be.
A risk management department has been established for an efficient assessment of the
company’s risks. One major task of this department is drafting the company’s final documents
in terms of risk management: Final Risk Register, Final Risk Report, Final Measure
Implementation Plan and the Company’s Risk Profile.
Three role levels are set up in the risk management system:
base level, represented by those who identify risks and by the risk managers (head of
each organizational unit) who are responsible for preparing risk management
documents related to the level of the unit they manage;
middle level, represented by the company’s middle management, who together with
the heads of the organizational units form the Risk Management Commission that
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facilitates and coordinates
direction/department/division;
the management process within
the
respective
high level, represented by the executive upper management through the Risk Analysis
and Management Commission that approves the company’s risk appetite and risk
profile in accordance with its objectives.
General scope of the risk management activity:
1. setting the general uniform framework for risks
identification, analysis and
management;
2. providing the appropriate tool for a controlled and efficient risk management;
3. describing the manner in which control measures are set and implemented in order to
prevent the occurrence of negative risks.
Some of the analysed risk categories are: financial risks, market risks, occupational health and
safety risks, personnel risks, risks related to information systems, and legal and regulatory
risks.
All risks are analysed from following perspectives:
specific objective the risk refers to;
causes of risk occurrence;
consequences further to risk materialization;
occurrence probabilities;
risk materialization impact;
risk exposure;
risk response strategy;
recommended control (remedy) measures;
residual risks remaining after treatment of initial risks.
Internal control
The internal control system represents not only documents, technical procedures, programs,
instructions, computers and policies books, but people at each level of the organization.
Internal control is a process carried out by the personnel at all levels: Board of Directors,
executive management, entire personnel, respectively.
It is carried out by the top management and bottom management, such as compartments
responsible and the other employees as well. Each member of the company is responsible
with his internal control.
In Romgaz, the internal control system operates in a control environment in a continuous
change that requires the adjustment of control at the level of every activity, differentially and
integrative, established in relation to the company’s interests.
The control system developed and implemented in Romgaz, as part of the management
process, targets all the activities of the organizational units, at all levels of management, and
aims to achieve the objectives under the condition of risk identification and management
related to such.
The internal/management control has to ensure the following:
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- Compliance with the law in force
-
-
-
-
- prevention and control of risks of non-fulfilment of set objectives
applying the management resolutions
a good functioning of internal activity
efficiency of operations
efficient use of resources
Repealing Ministry of Public Finance Order 946/20056 and entering into force of SGG Order
no 400/20157 in June 2015 generated a new conceptualization of the main internal control
directions in Romgaz aiming at creating a tighter and more coherent bond with the other
management control instruments – internal audit and risk management system, and internal
audit and risk management system, and to establish a reporting and monitoring system for the
Board of Director through its Audit Committee for monitoring such activity8.
The internal/management control system developed and implemented in Romgaz targets the
achievement of the following objectives:
compliance with legal regulation, with internal rules, with contracts and administrative
and jurisdictional decisions applicable to the company’s activity;
fulfilling Romgaz objectives under efficiency, economy and efficiency conditions;
development and maintenance of collection, storage, processing, updating and
distribution of financial and management data and information, as well as of proper
systems/procedures to inform the public.
The preparation, implementation, development and assessment of internal/management
control system for Romgaz are achieved in compliance with the provisions set in Government
Ordinance No. 119/19999 and with the standards provided by Order SGG no. 400/2015,
supplemented with Order SGG NO 200/201610 grouped in five main categories:
Category
Control environment
Risk management and
performance
Control activities
Main aspects
Company organization, human resources management, ethics principles and
rules, deontology and integrity
Applicable to all of the company’s processes and activities, targets how
objectives were set, sets risk identification methods and risk management,
planning
(governing plan and
(multiannual planning),
management plan) and performance monitoring
scheduling
Internal procedures are documented and drafted in relation to the main
processes so that the initiation and verification functions separation is
maintained in order to mitigate error and fraud risk, and in relation to
6 Public Finance Ministery Order no. 946 as of July 4, 2005 for the approval of Internal Control Code comprising
internal/management control standards at public entities and for the development of internal/management
systems;
7 Government General Secretary Order No. 400/2015 for the approval of internal/management control systems of
public entities;
8 Issue included in 2016 in the Corporate Governance Code
9 Government Ordinance no. 119 as of August 31, 1999 regarding internal control and preventive financial
control
10Government General Secretary Order No. 200/ February 26, 2016 regarding the amendment and
supplementation of Government General Secretary Order No. 400/2015 for the approval of
internal/management control systems of public entities;
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Board of Director’s Report 2016
operation continuity by means of continuous supervision and management of
deviations from set procedures
Information and communication Targets the creation and development of a flexible and rapid information
information quality and usage of proper
system
communication methods and channels
type.
Development of reporting system for the implementation of the governing
and management plan, entity budget, management of resources use and
document.
to ensure both
information
for each
Evaluation and audit
Drafting and implementation of policies, plans and schedules for the
development of internal/management control in terms of perfecting such by
the assessment of the implementation carried out by the internal audit
compartment
Among the 2016 internal/management control system development/improvement actions we
specify the following:
Romgaz’s adherence at the end of 2016 to the National Anticorruption Strategy 2016-
2020 and assuming the principals and fundamental values promoted by this strategy-
Adherence statement is posted on the internet website, correlated with Standard 1 of
Order SGG no 400/2015 “ Ethic and integrity”
Development of the Internal/ Management Control System application, an IT
application allowing the online access and filling in the Questionnaire of self-
assessment of the implementation status of internal/management control standards by
all the employees with executive positions and an easy and efficient access of the
Monitoring Commission both for analysis and approval of procedures and viewing and
analysing in real time, the application of the Commission’s Resolutions.
development of an IT application allowing all of Romgaz personnel to consult the
internal decision register and to view the content;
reviewing internal procedures on:
-
irregularities management, completed at the end of the year 2016;
- preparation of the procedure which sets the framework of identification,
classification and use of confidential and internal use information and of
resources related to it in order to protect the company against operational,
legal and image risks caused by the unauthorized or accidently revealing,
modification or destruction of them; this procedure entered into force on
December 8, 2016
drafting and updating Romgaz Risk Register;
According to the self-assessment results for the implementation of Internal/Management
Control System, in 2016 (in relation to the 16 internal/management control standards provided
in Order no. 200/2016), the Internal/Management Control System is partially implemented.
In order to increase the quality of the internal control activity and the performance of
management act as regards the use of public resources, the following are recommended:
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Board of Director’s Report 2016
increase the managers responsibility as regards the organization of internal control
and implementation of control findings;
supervising the systematic update of the procedures in terms of legal changes and
risks evolution;
Coordinating the internal control system of the company with the risk management
Supporting
the management
in
implementation of
the
internal auditors
recommendations
Ensuring the consultancy requested by the management.
Romgaz’s Code of Conduct was prepared in 2013. For the moment is being updated. The
effective document is posted on the website www.romgaz.ro, at “Investor Relations-
Corporate Governance” in order to ensure the principles of transparency.
The periodical reports on the indicators relevant for compliance with the rules of conduct
have been prepared by the person responsible with monitoring the compliance of the Code of
Conduct and have been posted on the intranet webpage of the Company.
Romgaz activities in the field of social responsibility are performed voluntarily, beyond the
legal responsibilities, the company being aware of its role in society. Social responsibility
means for Romgaz a business culture including business ethics, customer rights, economic
and social equity, environmental friendly technologies, fair treatment of workforce,
transparent relationship with the public authorities, moral integrity and investment in the
community.
Also, Romgaz supports a sustainable development of the society and community, through
financial support/ total or partial sponsorship for some actions and initiatives in the following
main domains: education, social, sport, health and environment.
Supporting these projects, within the limits of the budgeted financial resources, has revealed
the pro-active attitude of the company in the field of social responsibility and has increased
the awareness degree of the involved parties as regards the importance and benefits of the
social responsibility.
In 2016, Romgaz supported, totally or partially, actions and initiatives stipulated into the
Government Emergency Ordinance (“GEO”) no.2/2015, complying with the budget, as
follows:
Expenses/activities Name
Total of sponsorship expenses, out of which
Expenses with sponsorships in medical and health domains -
Article.XIV letter.a)
Program
(RON)
Actual
(RON)
9,600,000
3,840,000
9,255,687
3,666,687
Expenses with sponsorships in education and sport domains –
3,840,000
3,706,148
Article XIV letter.b) – total, out of which:
o For Sports Clubs
Sponsorships for other actions and activities - Article.XIV
letter.c)
3,427,000
1,920,000
3,427,000
1,882,852
The detailed description of the projects as regards the sponsorship provided in Government
Emergency Ordinance no.2/2015 is included in Annex 4 to this Report. The Report on social
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Board of Director’s Report 2016
responsibility sponsorship/Patronage actions for 2016 can be found on the internet page
the section “Investor Relations- Corporate Governance- Social
www.romgaz.ro, at
Responsibility”.
All the above mentioned projects had, besides the benefits for the community, detailed for
each case separately, a benefit for the Company, promoting Romgaz image as a company that
sustains by means of sponsorships a series of events that help the community. Such benefit is
reflected also in the perception of Romgaz in front of its investors, local and central
authorities, media and other parties. In this sense, the award for social responsibility won by
Romgaz for the “Program for the communities’ health” awarded at Energynomics Awards
IVth edition validates and confirms this direction of Romgaz.
When supporting/performing projects, actions, social responsibility initiatives, Romgaz took
into consideration the provisions of Sponsorship Policy and Sponsorship Guide applicable in
2016, published on the company’s website at Social Responsibility section.
Politics and Remuneration Criteria of the Executive and Non-Executive Members of the
Board of Directors
Legal Framework
The politics and remuneration criteria of the executive and non-executive members of the
Board of Directors are based on the following norms:
Law no. 31/1990 on trading companies, as amended;
GEO no. 109/2011 on corporate governance of public enterprises, as amended;
The company’s Articles of Incorporation, approved by the Extraordinary General
Meeting of Shareholders no. 12/September 26, 2012, as amended;
Resolution no. 14/August 26, 2013 of the Ordinary General Meeting of Shareholders
which established the general limits of the remuneration of the director general,
executive member of the Board of Directors;
Resolution no. 29/December 16, 2013 of the Board of Directors through which the
Mandate Contract of the Director General of the company was approved;
Resolution no. 12/July 26, 2013 of the Ordinary General Meeting of Shareholders
through which the Directors’ Contracts were approved.
For the compliance with the Requirements of BVB Corporate Governance Code and
Emergency Government Ordinance no 109/2011, Romgaz drafted the Policy on remuneration
which shall be analysed by the Board of Directors in a meeting subsequent to March 23, 2017.
The structure of the remuneration granted to non-executive directors
Fixed Remuneration
The fixed monthly remuneration for each non-executive member of the Board of Directors
was established according to Article 37, paragraph (3) of the GEO no. 109/2011 on corporate
governance of public enterprises, as modified through GEO no. 51/2013 and provided in the
Director Framework Contract approved through Resolution no. 12/July 26, 2013 of the
General Meeting of Shareholders.
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Board of Director’s Report 2016
The fixed monthly allowance is paid considering the following criteria:
The Chairperson and members of the Board of Directors who belong to at least two
advisory committees at Board’s level benefit from a fixed monthly salary at
maximum value;
The Board members who belong to an advisory committee constituted at the board’s
level, benefits from a fixed monthly salary representing 90% of the fixed monthly
salary at maximum value;
The Board members who do not belong to any advisory committees at the board’s
level, benefit from a fixed monthly salary representing 85% of the fixed monthly
salary at maximum value
Variable Remuneration
The variable remuneration was established according to provisions of Article 37, paragraph
(5) of the GEO no. 109/2011 on corporate governance of public enterprises, as amended
through GEO no. 51/2013, which provides that:
“The level of the variable component is determined according to duly justified
recommendations, formulated on the basis of a comparative study on the payment conditions
for similar positions in companies, from the same activity field, whose majority shareholder is
state, in and other European states, or based on the nomination committee or, if applicable,
by human resources recruitment experts whose services were contracted for the procedure of
selecting the Board members /supervisory committee…”
It was also corroborated with the provisions of the Directors’ Contracts, whose frame content
was approved through Resolution no. 12/July 26, 2013 of the General Meeting of
Shareholders.
According to the Directors’ Contracts the variable remuneration is divided into two sub-
components, a first component depending on the fulfilment of performance indicators, while
the second sub-component could be granted in case of exceeding the accomplished net profit
level with a higher percentage of 0.4% as compared to the one approved through the income
and expenditure budget of the company, respectively the amount which represents the
difference between the actual accomplished net profit and the estimated net profit for every
financial year, but not larger than the value of the annual fixed salary determined according to
Article 16 from the Directors’ Contract.
Mandate contract concluded with the members of the Board of Directors elected in
accordance with the Ordinary General Meeting of Shareholders Resolution no. 10/November
15, 2016, as it has been approved by the Resolution no. 13/December 30, 2016 of the
Ordinary General Meeting of Shareholders, does not include the variable component.
The structure of the remuneration granted to the executive director, namely Director
General
Fixed remuneration
The fixed monthly remuneration of the executive director – Director General, was established
corroborating the provisions of Article 37, paragraph (4) of the GEO no. 109/2011, providing
that:
“Article 37 (4)The fixed monthly remuneration of the executive members cannot
exceed the mean of the average gross monthly salary on the last 12 months in the company’s
field of activity, as communicated by the National Statistics Institute prior to appointment.”
corroborated with Resolution no. 14/2013 of the General Meeting of Shareholders, which
provides that:
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Board of Director’s Report 2016
“Item 1.Establishes the general limits of the remuneration of the Director General of
SNGN Romgaz SA, executive director of the Board of Directors, as follows:
- For the fixed monthly average gross salary between 4 and 6 times on the last 12
months of the gross monthly salary in the company’s filed of activity, as
communicated by the National Statistics Institute prior to appointment”.
Variable Remuneration
The variable remuneration was established according to provisions of Article 37, paragraph
(5) of the GEO no. 109/2011 on corporate governance of public enterprises, as amended
through GEO no. 51/2013, which provides that:
“(5) The level of the variable component is determined according to duly justified
recommendations, formulated on the basis of a comparative study on the payment conditions
for similar positions in companies, from the same activity field, whose majority shareholder is
state, in and other European states, or based on the nomination committee or, if applicable,
by human resources recruitment experts whose services were contracted for the procedure of
selecting the Board members /supervisory committee…”
together with provisions of Article 38, paragraph (2) of the GEO no. 109/2011, providing that:
“The remuneration consists of a fixed monthly salary within the limits provided at
Article 37, paragraph (4) and of a variable component, consisting of a share of the
company’s net profit, a retirement scheme or other forms of remuneration based on
performance indicators.”
corroborated with provision of Mandate Contract and Resolution no. 14/August 26, 2013 of
the General Meeting of Shareholders.
In this context, according to the provisions of the mandate contract, the variable remuneration
is divided into two sub-components, a first component depending on the fulfilment of
performance indicators, while the second sub-component could be granted in case of
exceeding the accomplished net profit level with a higher percentage of 0.4% as compare to
the one approved through the income and expenditure budget of the company, respectively
the amount which represents the difference between the actual accomplished net profit and the
estimated net profit for every financial year, but not larger than the value of the annual fixed
salary determined according to Article 12 (i) from the Mandate Contract of the Director
General.
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Board of Director’s Report 2016
The timeline of the directors’ contracts, the mandate contract, the Management Plan and the
Directors’ Plan is the following:
June 12, 2013 – The Board of Directors’ Resolution no. 8 approves the appointment of
“Mr. Virgil Marius Metea as executive director - Director General”;
July 26, 2013 – The GSM Resolution no. 12 approves the Director’s Contract to be
concluded with the members of the Board of Directors;
September 25, 2013 – the GSM Resolution no. 16 approves the 2013-2017 Directors’ Plan
prepared and presented by the Board of Directors;
December 16, 2013 – the Board’s Resolution no. 29 approves the Mandate Contract
between Romgaz and Mr. Virgil Marius Metea as executive director-Director General.
January 29, 2014 – the Board’s Resolution no. 1 approves the “Management Plan of
Romgaz’s Director General over the mandate contract’s term i.e. 2013-2017”.
November 15, 2016 - By Resolution no.10, the Board of Directors revoke Mr. Virgil
Marius Metea from the position of executive director.
December 30, 2016 – by Resolution no.13, the General Meeting of Shareholders aproves
the Directors Agreement which shall be concluded with the new members of the Board of
Directors.
The Director General’s Management Plan encloses his vision for the fulfilment of the
company’s strategic objectives as provided in the Directors’ Plan and the fulfilment of
performance criteria and objectives set in the Director’s Contracts.
The Director General’s performance criteria and objectives are the same with the performance
criteria and objectives provided in the Director’s Contracts.
The main performance objectives provided in the Directors’ Contracts and the Management
Contract may be summarized as follows:
Increasing the company’s gas resources and gas reserves portfolio by discovering new
resources and by developing and improving the recovery degree of already discovered
resources;
Consolidating the company’s position on the electricity supply market;
Optimizing, developing and diversifying the underground storage activity by
reconsidering its importance for ensuring safety, continuity and flexibility in supplying
natural gas;
Increasing the company’s performance;
Identifying of new growth and diversification opportunities;
Improving the company’s organization structure, including the reorganization of the
internal audit function.
Together with the specific measures taken for fulfilling each objective, Romgaz committed to
implement general measures supporting the fulfilment of the company’s strategic objectives.
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Board of Director’s Report 2016
Such measures target the following activity segments:
Human resources management;
Corporate governance and social responsibility;
Optimization of budgeting and control process;
Improving the company’s image;
Implementation of legal provisions on legal separation of UGS activity;
Developing the role of the company’s risk management.
Considering that the Management Plan was approved only on January 2014, the reporting of
measures and actions undertaken to fulfil the company’s strategic objectives begins only in
Q1 2014.
The measures and actions for the fulfilment of strategic objectives, as set in the Directors’
Plan, are quarterly and annually monitored by the following indicators and performance
criteria:
No.
0
1. EBITDA
2. Revenue
Indicator
M.U.
1
2
thousand
RON
thousand
RON
Performance
criterion
Indicator
Weighting
coefficient
3
4
increasing
4.50%/year
5
0.25
increasing
6%/ year
0.20
3. Labour productivity
RON/person
increasing
6%/ year
4. OPEX
to RON 1000
RON
decreasing
0.60%/ year
operating income
5. Geological resources
million m3
increasing
1%/ year
6. Natural gas production
%
keeping stable
1.5%/ year
decline
7. Outstanding payments
thousand
RON
keeping stable
0
0.10
0.10
0.10
0.15
0.10
For the purpose of mitigating pronounced fluctuations of the indicators due to external factors
beyond the company’s management control, the indicators are calculated by means of relating
their resulting value over the reporting period to the arithmetic means of the indicators’ values
resulting during the past three time periods previous to the reporting period.
In view of the fact that:
Government Decision provisions no. 831 dated August 4, 2010 approved the selling
by the Ministry of Economy, Commerce and Business Environment (through OPSPI)
of 15% of SNGN Romgaz S.A. share capital;
the shares selling process, respectively the approval for trading of shares on the
regulated market operated by Bucharest Stock Exchange and of GDRs on London
Stock Exchange was finalized in November 2013;
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Board of Director’s Report 2016
from an accounting perspective, by the time shares were admitted for trading on a
regulated market Romgaz carried out its activities in accordance with Public Finance
Ministry Order no. 3055/2009;
in 2012, after issuing Order no. 881 dated June 25, 2012, the Public Finance Minister
decided to expand the scope of IFRS. According to this piece of legislation, the
companies whose securities are admitted for trading on a regulated market must apply
as of 2012 the IFRS when preparing the annual financial statements;
According to Public Finance Minister Order no. 1121/2006, these entities had the
option (not the obligation) to prepare separate financial statements based on IRS for
other users than the Romanian state entities.
Order no. 881/2012 repeals Article 4 of Order no. 1,121/2006 requesting the IFRS
applying entities to also draft financial statements in accordance with national
accounting provisions;
the Public Finance Minister Order no. 1286/October 1, 2012 approved the
Accounting Regulations complying with IFRS applicable to companies whose
securities are admitted for trading on a regulated market.( repealed by PFM Order no.
2844/2016)
the Public Finance Minister Order no. 2844/December 19, 2016 repealed the
Accounting Regulations complying with IFRS applicable to companies whose
securities are admitted for trading on a regulated market.
Romgaz is obliged to apply IFRS as of 2013.
Because prior to trading of shares the company’s statutory accounting was according to Public
Finance Minister Order 3055/2009 and as of 2013 it is according to IFRS, some clarifications
are due in relation to how the performance indicators’ achievement degree is calculated. The
Board of Directors approved on November 13, 2013 the required clarifications:
“quarter” means the accumulated time starting from the beginning of the year until the
end of the quarter for which performance indicators are calculated;
for comparison purposes, as of 2014, for the interim periods of the year (QI, QII and
QIII), the indicators relating to the similar time periods of previous 3 years which were
calculated according to Public Finance Ministry Order no. 3055/2009 are established
as follows:
Indicator
iQ
.
(
IFRS
)
Indicator
iQ
.
OMFP
(
3055
)
Indicator
year
OMFP
(
3055)
where: i=1÷3;
x
Indicator
year
(
IFRS
),
for 2013, indicators were calculated based on the financial statements prepared
according to Public Finance Ministry Order no. 3055/2009; at the end of the year,
these are recalculated according to IFRS. Adjustments were made at the end of the
year after the approval of financial statements when annual indicators are calculated
according to IFRS;
the target indicators will be set at the beginning of each year (after closing the
previous year’s financial statements). They are calculated as an average over the past
three years and of the envisaged performance indicator.
In 2016, the following actions have been carried out as regards the modification of
performance indicators included in the Directors Plan for the period 2013-2017, approved by
the General Meeting of Shareholders Resolution no 16/ September 25, 2013:
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Board of Director’s Report 2016
by Resolution no 5/June 16, 2016, the General Meeting of Shareholders approved “the
modification of the performance indicators calculation method, namely to eliminate
the effects of the external factors that are beyond the control of the company’s
management”
By Resolution no.7/August 11, 2016, the item referring to the modification of
performance indicators calculation method approved by Resolution no.5/June 16, 2016
had been repealed.
By Resolution no. 10/November 15, 2016, further the analysis of the proposal to
modify the performance indicators, the General Meeting of Shareholders decided ”not
to approve the modification of the calculation method of the performance indicators
weighting factors, as well as the amendment of the Directors Plan in this respect and
the performance criteria and objectives”
The achievement of performance indicators and criteria in 2016 is shown below:
Average
values
2011-
2013
4
Weighting
factor
Indicator
Target
values
Achieved
values
Achievement
rate
Weight
1
EBITDA
CA
W
Cexpl/Vexpl
RES
dQ
Pres
Total
2
0.25
0.20
0.10
0.10
0.10
0.15
0.10
1.00
6
5
3
+4.5% 2,579,419.0 2,695,492.9 1,989,547.7
+6% 4,146,764.1 4,395,569.9 3,411,867.7
559.1
+6%
-0.6%
+1%
-1.5%
0
2,279.3
5,663.311
0
4,219.4
2,605.0
2,302.1
5,331.1
585.1
704.4
664.5
600.4
604.0
0
0
7=6/5x100
73.8
77.6
79.4
102.6
113.2
79.1
110.0
8=2x7
18.45
15.52
7.94
10.26
11.32
11.87
11.00
-
-
-
-
-
86,36
EBITDA
CA
W
Cexpl/Vexpl
RES
dQ
Pres
– (RON thousand);
– revenue (RON thousand);
– labour productivity (RON thousand/employee);
– operating expenses to1000 RON operating income;
– volume of geological resources (million m3);
– gas production decline (%);
– outstanding payments (thousand RON).
The performance criteria and objectives achievement degree is 86.36%.
The failure to achieve the performance indicators and the performance criteria has been
influenced by:
EBITDA –lower by RON 705.5 million (-26.2 %) compared to target value;
Revenue– lower by RON 983.7 million (- 22.38%) compared to target value;
1 It is the production for 2012, corrected with 1.5% target decline, year 2012 considered as “base year”.
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Board of Director’s Report 2016
Labour productivity- lower by RON 145.3 million /person (-20.60%) compared to
target value
Gas production decline – lower by 1,111.7 million m3 compared to target value.
From the first year of mandate, a number of contingencies arrised beyond the control of the
board of directors or of the company’s management that impede the fullfilment of the
objectives and performance indicators included in the Directors Agreement and Governing
Plan, respectively, such as:
non- compliance of the calendar related to the gradual increase of the market sale price
for domestic gas production considered when preparing and approving the Governing
Plan;
fiscal regulations with a significant impact on the company’s performances, such as:
extending after December 31, 2014 the period for applying the windfall tax for
gas producers as a result of price deregulation;
the tax on special constructions as of January 1, 2014, the so called “pole tax”;
reduced national gas consumption.
As a result, in accordance with the provisions of the Governing Plan and the Directors
Agreement, the company’s Board requested to shareholders to amend the calculation method
of performance indicators included in the Directors Agreement. The request was substantiated
by the Note no. 13293 on May 16, 2016 presented to shareholders and discussed during the
ordinary meeting on June 16, 2016.
Further the analysis of the substantiated requests, by item I of Resolution no. 5 as of June 16,
2016, the General Meeting of Shareholders approved “the amendment of the calculation
method of the performance indicators, namely by eliminating the effects of the influence of
external factors that are beyond the control of the company’s management”. By Item II of the
same Resolution, the General Meeting of Shareholders approved “the conclusion of an
Addendum to the Directors Agreement for amending the calculation method of
performance indicators, namely by eliminating the effects of the influence of external
factors that are beyond the control of the company’s management”, mandating the
representative of the majority shareholder to sign the Addendum to the Directors Agreement
(item III).
Further the request of the Ministry of Energy, as a majority shareholder, the agenda of the
Ordinary General Meeting of Shareholders on August 11, 2016 was supplemented with the
proposal to revoke the approvals of the GMS during the meeting of June 16, 2016 concerning
the amendment of calculation method of performance indicators, conclusion of an Addendum
to the Directors Agreement and mandating the representative of the majority shareholder to
sign it. By Resolution No 7 as of August 11, 2016, the GMS approved the requests of the
Ministry of Energy.
On the agenda of the Ordinary General Meeting of Shareholders of November 15, 2016 the
Report no 25988 of October 5, 2016 has been added regarding the proposal to modify the
performance indicators included in the Director Agreement. By this Report, the Board of
Directors requested "to set the performance indicators in conjunction with the Income and
Expenditure Budget indicators, as approved by Resolution No.5/June 16, 2016 of the General
Meeting of Shareholders”. By Resolution No.10 of November 15, 2016, the GMS did not
approve "the criteria and performance targets, in conjunction with the Income and
Expenditure Budget indicators of S.N.G.N. Romgaz S.A. approved by Resolution No. 5/2016".
Page 97 of 98
MANAGEMENT
SUPPORT DIRECTION
ECONOMIC
DEPARTMENT
MEDIAS BRANCH
TARGU MURES
BRANCH
S.T.T.M.
TARGU MURES
PLOIESTI UGS
BRANCH
FINANCIAL
MANAGEMENT
CONTROL OFFICE
INTERNAL AUDIT
OFFICE
RISK MANAGEMENT
OFFICE
GENERAL MEETING OF
SHAREHOLDERS
BOARD OF DIRECTORS
DIRECTOR GENERAL
Annex no.1
DIRECTIA CALITATE,
SECURITATE, MEDIU
DIRECTIA
RESURSE UMANE
DEPUTY DIRECTOR
GENERAL
(exploration-production)
DEPUTY DIRECTOR
GENERAL
(investments)
DEPUTY DIRECTOR
GENERAL
EXPLORATION
PRODUCTION
DIVISION
BRATISLAVA
BRANCH
BUSINESS
DEVELOPMENT
DIRECTION
PETROLEUM
REGISTRY OFFICE
PROCUREMENT
DIRCETION
S.I.R.C.O.S.S.
MEDIAS
ENERGY TRADE
DEPARTMENT
IERNUT ELECTRIC
POWER PRODUCTION
BRANCH
TECHNICAL
TECHNOLOGIES
OFFICE
DEPARTMENT
RESPONSIBLE FOR
BLOCKS
DRILLING
CHIEF
ENGINEER
CORPORATE
MANAGEMENT DIRECTION
IT AND
TELECOMMUNICATION
DIRECTION
TECHNICAL
DIRECTION
INVESTMENTS,
PROJECT
MANAGEMENT
DEPARTMENT
PROJECT
MANAGEMENT
OFFICE
SNGN “ROMGAZ” SA Annex no 2
Table of Compliance with the Bucharest Stock Exchange Code of Corporate Governance
Code provisions
1
Complies
2
Does not
comply or
partially
complies
3
Reason for non-compliance
4
A.1
A.2
A.3
A.4
A.5
A.6
All the companies must have an Internal Regulation of BoD that includes the reference terms/
the responsibilities of the Board and the company’s key management positions, and that applies,
among others, the General Principles in section A.
The ToR of the BoD should include provisions on the management of conflict of interest stating
that members of the Board should notify any conflicts of interest which have arisen or may arise,
to the Board and should refrain from taking part in the discussion (including by not being present
where this does not render the meeting non-quorate) and from voting on the adoption of a
resolution on the issue which gives rise to such a conflict of interest .
The BoD has at least five members
The majority of the members of the BoD is non-executive; not less than two non-executive
members of the BoD are independent.
Each independent member of the BoD must submit a statement at the time of his/her nomination
for election or re-election, as well as whenever a change in his/her status occurs, indicating the
elements on which it is deemed independent in terms of its character and his judgment.
A Board member’s other relatively permanent professional commitments and engagements,
including executive and non-executive Board positions in companies and not-for-profit
institutions, should be disclosed to shareholders and to potential investors prior to his/her
nomination and during his/her mandate.
Any member of the BoD should submit to the Board information on any relationship with a
shareholder who holds, directly or indirectly, shares representing more than 5% of all voting
rights. This also applies to any report which may affect the member's position on matters decided
by the Council.
1
x
x
x
x
x
x
The ToR of the BoD has been updated and
approved by the Board of Directors.
Items on the conflict of interests are found
in the Corporate Governance of Romgaz, as
well as in the company's Code of Conduct,
both documents being published on the
company website.
The ToR of the BoD has been updated in
this respect.
This provision is already mentioned at Art.
6, par. 15 of CCG ROMGAZ.
The ToR of the BoD has been updated in
this respect.
A.7
A.8
The company should appoint a Board secretary responsible for supporting the work of the BoD
The corporate governance statement should inform on whether an evaluation of the Board has
taken place under the leadership of the chairman or the nomination committee and, if it has,
summarize key action points and changes resulting from it. The company should have a
policy/guidance regarding the evaluation of the BoD containing the purpose, criteria and
frequency of the evaluation process.
A.9
A.10
A.11
B.1
B.2
B.3
The corporate governance statement should contain information on the number of meetings of
the Board and the committees during the past year, attendance by directors (personally and in
their absence) and a report of the Board and committees on their activities.
The corporate governance statement should contain information on the precise number of the
independent members of the Board of Directors
The BoD should set up a nomination committee formed of non-executives, which will lead the
process for Board appointments and make recommendations to the Board. The majority of the
members of the nomination committee should be independent
The Board should set up an Audit Committee and at least one member should be an independent
non-executive.
The Audit Committee should be composed of at least three members and the majority should be
independent.
The majority of members, including the chairman, should have proven an adequate qualification
relevant to the functions and responsibilities of the Committee. At least one member of the Audit
Committee should have a proven and appropriate accounting and auditing experience.
The President of the Audit Committee should be an independent non-executive member.
Among its responsibilities, the Audit Committee should undertake an annual assessment of the
system of internal control.
2
x
x
x
x
x
x
x partially
x partially
Also, Romgaz has developed a Policy on
related parties referring to this obligation; it
will be submitted for the approval of the
Board in a meeting subsequent to this
statement. Following the approval, it will be
published on the company website.
The section on Statement on corporate
governance
the Annual Board of
Directors’ Report includes statements on the
evaluation of the BoD.
in
the Policy regarding
Romgaz prepared
evaluation and it will be submitted for the
approval of
in a meeting
subsequent to this statement. Following the
approval
the
company website.
it will be published on
the Board
responsibility
the
The
effectiveness of the company’s internal
for monitoring
B.4
B.5
The provision mentioned in section B.3 should consider the effectiveness and scope of the
internal audit function, the adequacy of risk management and internal control reports to the Audit
Committee of the Board, and management’s responsiveness and effectiveness in dealing with
identified internal control failings or weaknesses and submit relevant reports to the Board .
The Audit Committee should review conflicts of interests in transactions of the company and its
subsidiaries with related parties.
B.6
The Audit Committee should evaluate the efficiency of the internal control system and risk
management system
x partially
x partially
control systems, internal audit and risk
management is specified in the ToR of the
Audit Committee.
Internal Rules of the Committee has been
updated to clarify responsibilities, and it
will be submitted for the approval of the
Board in a meeting subsequent to this
statement. Following the approval, it will be
published on
company website,
the
replacing the current Internal Regulation.
x partially
See Section B.3.
This provision is already mentioned under
Art. 8, par. 2 of CCG ROMGAZ.
The ToR of the Audit Committee has been
updated in order to include this provision
and it will be submitted for the approval of
the Board in a meeting subsequent to this
statement.
Also, Romgaz has developed a Policy on
related parties and the document will be
submitted for the approval of the Board in a
meeting subsequent
this statement.
Following the approval it will be published
on the company website.
to
responsibility
for monitoring
The
the
effectiveness of the company’s internal
control systems, internal audit and risk
management systems is specified in the ToR
of the Audit Committee.
3
The ToR of the Committee has been
updated to clarify responsibilities and it will
be submitted for the approval of the Board
B.7
B.8
B.9
B.10
B.11
B.12
The Audit Committee should monitor the application of statutory and generally accepted
standards of internal auditing and should receive and evaluate the reports of the internal audit
team.
The Audit Committee should report periodically (at least annually) or adhoc to BoD with regard
to the reports or analyzes undertaken by the committee.
No shareholder may be given undue preference over other shareholders with regard to
transactions and agreements made by the company with shareholders and their related parties
The BoD should adopt a policy ensuring that any transaction of the company with any of the
companies with which it has close relations, that is equal to or more than 5% of the net assets of
the company (as stated in the latest financial report), should be approved by the Board following
an obligatory opinion of the Audit Committee and fairly disclosed to the shareholders and
potential investors, to the extent that such transactions fall under the category of events subject to
disclosure requirements.
The internal audits should be carried out by a separate structural division (internal audit
department) within the company or by retaining an independent third-party entity
The Internal Audit Department should report functionally to the BoD via the Audit Committee.
For administrative purposes and in the scope related to the obligations of the management to
monitor and mitigate risks, the Internal Audit Department should report directly to the Director
General.
x
x
x
x
x
in a meeting subsequent to this statement.
Following the approval, it will be published
on the company website, replacing the
current ToR.
The provision is already mentioned under
Art. 9 of CCG ROMGAZ and will be
implemented by
the Policy on related
parties and it will be submitted for the
approval of
in a meeting
subsequent to this statement. Following the
approval,
the
company website.
it will be published on
the BoD
x partially
The ToR of the BoD has been updated and
approved by the BoD.
C.1
The company should publish a Remuneration Policy on its website. The Remuneration Policy
must be formulated so as to allow the shareholders to understand the principles and arguments
underlying the remuneration of the members of the Board and of the General Manager. Any
significant change occurred in the Remuneration Policy must be posted in due time on the
company's website.
x partially
This provision is already mentioned under
Art. 11, par. 5 of CCG ROMGAZ, and it
will be implemented by the Remuneration
Policy, and it will be submitted for the
in a meeting
approval of
the BoD
4
subsequent to this statement. Following the
approval,
the
company website.
it will be published on
in
The section on Statement on corporate
the Annual Board of
governance
statements
Directors’ Report
regarding
the
Remuneration Policy and the remuneration
of the Board of Directors members and the
remuneration of the Director General.
implementation of
includes
the
The Annual Report on Remuneration is
presented together with the Annual Board of
Directors’ Report.
x partially
Items on
the GMS organization are
presented to shareholders at each meeting.
A separate document on the GMS procedure
will be prepared and approved.
The company must include in its Annual Report a remuneration statement on the
implementation of this Policy during the annual period under review.
The Report on Remuneration must submit implementation of the Remuneration Policy for
persons identified in this Policy during the annual period under review.
D.1
D.1.1
D.1.2
D.1.3
D.1.4
D.1.5
The company should establish an Investors Relation Department - indicating to the public the
responsible person/persons or the organizational unit.
Besides the information required by the legal provisions, the company should also include on its
corporate website a dedicated Investor Relations section, both in Romanian and English, with all
the relevant information of interest for investors, including:
Principal corporate regulations: the articles of incorporation, general shareholders’ meeting
procedure
Professional CVs of the members of the company’s governing bodies; Board member’s other
professional commitments, including executive and non-executive Board positions in companies
and not-for-profit institutions.
Current reports and periodic reports (quarterly, semi-annual and annual reports) – at least those
specified in Note D.8- including current reports with detailed information related to non -
compliance with the Bucharest Stock Exchange Code of Corporate Governance
Information related to GMS: the agenda and supporting materials; the procedure approved for
the election of BoD members, the rationale for the proposal of candidates for the election to the
Board together with their professional CVs; shareholders’ questions related to the agenda and the
company’s answers, inclusively the decisions taken by the GMS
Information on corporate events (such as payment of dividends and other distributions to
shareholders, or other events leading to the acquisition or limitation of rights of a shareholder)
including the deadlines and principles applied to such operations.
The information will be published within a period so that investors are permitted to take
investment decisions.
5
x
x
x
x
x
x partially
Romgaz prepared the Dividend Policy; it
will be submitted for the approval of the
Board.
x
Romgaz prepared the Policy on forecast; it
will be submitted for the approval of the
Board.
D.1.6
D.1.7
D.2
D.3
D.4
D.5
D.6
D.7
D.8
D.9
D.10
The names and contact data of the persons who should be able to provide knowledgeable
information on request;
Corporate presentations (for example presentations for investors, presentations on quarterly
results), financial statements (quarterly, semi-annual, annual), auditor reports and annual reports
The company will have an annual cash distribution of dividend policy or other benefits for
shareholders, proposed by the Director General and adopted by the BoD as the company’s
Guideline on net profits distribution.
The principles of the annual distribution of dividends policy to Shareholders will be published on
the company’s website.
The company should have adopted a policy with respect to forecasts, whether they are made
public or not. The Policy on forecasts will determine the forecasts’ frequency, period and content
and will be published on the company’s website.
GSM rules should not restrict the participation of shareholders in general meetings and the
exercising of their rights. The modification of rules will become effective no sooner than the
following shareholders’ meeting.
The external auditors should attend the shareholders’ meetings when their reports are presented
there.
The BoD should present to the annual GMS a brief assessment of the internal controls and
significant risk management system, as well as opinions on issues subject to resolution at the
general meeting.
Any professional, consultant, expert, financial analyst, may participate in the shareholders’
meeting upon prior invitation from the BoD.
Accredited journalists may, also, attend the GMS, unless the Chairman of the Board decides
otherwise.
The quarterly and semi-annual financial reports should include information in both, Romanian
and English, regarding the key drivers influencing the change in sales, operating profit, net profit
and other relevant financial indicators, both on quarter-on-quarter and year-on-year terms.
The company should organize at least two meetings/conference calls with analysts and investors
each year. The information presented on these occasions should be published on the company
website in the IR section at the time of meetings/teleconferences.
If the company supports various forms of artistic and cultural expression, sport activities,
educational or scientific activities, and considers the resulting impact on the innovativeness and
competitiveness of the company is part of its business mission and development strategy, it
should publish the policy guiding its activity in this area.
x
x
x
x
x
x
x
x
x
6
Legend:
ToR
BoD
CV
GMS
CCG
BSE = Bucharest Stock Exchange
CCG ROMGAZ = the Code of Corporate Governance of S.N.G.N. ROMGAZ S.A., approved on January 28, 2016.
= Terms of Reference
= Board of Directors
= Curriculum Vitae
= General Meeting of Shareholders
= Code of Corporate Governance
7
SNGN “ROMGAZ” SA Annex no.3
Litigations
No.
File No./ Court of
Law
0
1
2
3
4
5
1
3878/110/2007 -
Bacau County
Court of Law
513/87/2012 -
Teleorman
County Court of
Law
2177/99/2012 -
Iasi County Court
of Law
1318/87/2013 -
Teleorman
County Court of
Law
10917/107/2010/a
2 - Alba County
Court of Law
Case
2
Plaintiff
Defendant
Amount
(RON)
Description
3
4
5
insolvency proceedings Romgaz - creditor
S.C.Uzina Termica
Comanesti S,A -
debtor
328,646.82
6
Decision no. 318/2009 of Bacau Court approved SNGN ROMGAZ SA‘s
request to initiate insolvency proceedings. Currently, the specific
insolvency proceedings acts are performed.
Next
procedural
deadline
7
May 25,
2017
insolvency proceedings Romgaz - creditor
SC Termaserv SRL
Alexandria - debtor
7,200,862
Receivable: RON 7,200,862.08 (on December 31, 2011 - equivalent
value of delivered gas, penalties, interest)
May 11,
2017
insolvency proceedings Romgaz - creditor
SC CET Iasi SA -
debtor
46,270,753
insolvency proceedings
Romgaz - creditor
SC Termaconfort SRL
Rosiorii de Vede -
debtor
1,888,201
insolvency proceedings Romgaz - creditor
SC GHCL UPSOM
ROMANIA SA- debtor
68,573,109
March 14,
2017
April 13,
2017
July 3, 2017
Receivables: RON 46,270,752.91 (equivalent value of delivered gas,
late payment penalties, interest, court fees). Civil court decision no.
697/April 17, 2012 issued by Iasi County Court of Law established the
opening of the general insolvency procedure for the debtor and
appointed an interim official receiver
Receivables: RON 1,888,200.99 (delivered gas price, late payment
penalties, interest/penalties calculated according to Payment Schedule
Agreement, fees related to enforcement procedure).
On 29.11.2010, SNGN ROMGAZ SA filed against the SC GHCL
UPSOM ROMANIA SA an application to open insolvency proceedings.
(File no. 10917/107/2010). SNGN ROMGAZ SA requested acceptance
of a certain, liquid and due receivable in amount of RON 60,841,881.14
(representing the equivalent value of natural gas, penalties calculated
according to Payment Schedule Agreement no. 100/May 5, 2009, late
payment penalties calculated until February 28, 2011, equivalent value
of assignment of receivables according to Assignment of Receivables
Contract no. 1/June 2, 2009)
Against decision no. 351/F/May 18, 2011, the debtor filed recourse
requesting the discarding of sentence and referring the case back to
Alba Court of Law.
1
No.
6
File No./ Court of
Law
564/2005 - Official
Receiver Office
Milos Cristian
Case
Plaintiff
Defendant
Amount
(RON)
Description
enforcement
proceedings
Romgaz - creditor
SC
Termoelectrica
Bucuresti - debtor
PEET
SA
42,665,005
Based on the enforcement order, Civil Decision no. 181/C/2005 issued
by Sibiu County Court of Law the debtor was obliged to pay the
creditor the amount of 148,826,365 (delivered gas price, default fees,
the
interest, court fees), bailiff office Milos Cristian requested
enforcement of the order against the monies the company has in bank
accounts opened in Bucharest.
Following the approval of attachment of bank accounts, the bailiff sent
letters of attachment of bank accounts opened in Bucharest.
Next
procedural
deadline
insolvency
6659/85/2012 -
Sibiu County
Court of Law
8028/95/2013 -
Gorj County Court
of Law
Claims
Romgaz-creditor
insolvency proceedings Romgaz - creditor
S.C.Grup de Comert
si Investitii SRL -
debtor
S.C. Grup de Comert
si Investitii SRL (by
the official receiver-
Divizia de
Reorganizare
Judiciara si Executare
Creante IPURL) -
debtor
Romgaz
1,135,220
SNGN ROMGAZ SA filed a summons requesting the debtor to pay
RON 1,135,220
finalised
1,135,220
On October 24, 2013, Gorj Court allowed the application of the debtor
S.C.Grup de Comert si Investitii SRL by court Decision no. 446/2013,
requesting
to
reorganize its activity.
insolvency proceedings
the opening of
in order
March 27,
2017
4,333,255
45,973
The plaintiff requested by the summons:
- to adjust the work contract No. 221/2012, concluded between the
parties, in the sense of enforcing the payment of the amount of
RON4,333,255 by the defendant, as equivalent value of additional
works performed following the extension of the contract duration.
Amount of claims: RON 45,973.26 - overdue payments penalties
calculated according to Natural Gas Sale Contract No.14/2008.
Recourse. Recourse dismissed by Giurgiu Court of Law.
finalised
finalised
Adjustment of work
contract no. 22/2012
SC FORAJ SONDE
SA
claims
Uzina
S.C.
Termoelectrica
Giurgiu - defendant
Romgaz - plaintiff
7
8
9
10
11
7779/85/2014 -
Sibiu County
Court of Law
6991/236/2009 -
Giurgiu Court of
Law
110/228/2011 -
Braila County
Court of Law
proceedings for real
estate claim
SC Foradex SA -
plaintiff
Romgaz, SC
Amromco Energy
SRL - defendants
n/a The plaintiff requested the defendants to grant full possession of Well
22 Balta Alba to Foradex, decommissioning of the rig and payment of
penalties.
finalised
2
No.
12
13
File No./ Court of
Law
5910/228/2010 -
Braila County
Court of Law
1299/57/2011 -
Appeal Court of
Law in Alba Iulia
14
598/57/2011 -
Sibiu County
Court of Law
(retrial at the High
Court of
Cassation and
Justice)
15
7852/85/2013 -
Sibiu County
Court of Law
16
8259/62/2013 -
Brasov County
Court of Law
Case
Plaintiff
Defendant
Amount
(RON)
Description
eviction proceedings
SC Foradex SA -
plaintiff
Romgaz - plaintiff
of
Annulment
action
administrative
no.
5951/08.04.2011
issued by the National
Fiscal
for
Agency
Administration DGFP
Sibiu
Romgaz, SC
Amromco Energy
SRL– defendants
Agentia Nationala de
Administrare Fiscala;
DGFP
-
defendant
SIBIU)
The scope of the summons is the eviction of the defendants with
respect to well 22 Est Balta Alba.
1,688,843
Amount of claim: RON 1,688,843, High Court of Cassation and Justice
rejects the recourse due to ANAF lack of grounds.
SNGN ROMGAZ SA brought the action before administrative appeal
requesting annulment of financial control protocol no. 5951/April 8,
2011 issued by ANAF-DGFP Sibiu establishing the unconformity with
legal provisions in relation with setting and payment of dividends for
2008 financial year, in relation to which default interest of RON
1,688,843 is calculated.
Next
procedural
deadline
stay of trial
proceedings
complusory
enforcement
Bring the action before
administrative appeal
Romgaz - plaintiff
Court of Accounts of
Romania - defendant
102,357,059
SNGN ROMGAZ SA brought the action before administrative appeal
requesting annulment of actions issued by the Romanian Court of
Accounts – Sibiu Chamber of Accounts, namely: Note no.3/2011;
Decision No.10/24.01.2011;Finding report registered at SNGN Romgaz
SA under no. 2033/10.12.2010
currently not
established
Claims -undue payment Romgaz - plaintiff
Claims -undue payment Romgaz - plaintiff
SC APROV SA; SC
ROMOIL SA -
defendant
SC Condmag
SA;Cameron
International
Corporation -
defendants
3
20,052,457
In the summons, SNGN ROMGAZ SA requested the court to compel
the defendants to pay jointly the amount of RON 20,052,457 :
stay of trial
proceedings
-
-
RON 14,408,931 lei – representing the undue payment made
according to supply contract no. 42/2010 and
RON 5.643.526 – representing the additional payment made
under supply contract no. 6/2010)
In the summons, SNGN ROMGAZ SA requested the court to compel
the defendants to pay jointly the amount of RON 43.059.199,
representing the undue payment in connection with work contract no.
217/2006
stay of trial
proceedings
43,059,199
No.
17
File No./ Court of
Law
8258/62/2013 -
Brasov County
Court of Law
18
19
20
21
22
23
8260/62/2013 -
Brasov County
Court of Law
19495/3/2013 -
Bucuresti Court of
Law
2541/96/2013 -
Harghita County
Court of Law
13991/320/2012 -
Tg. Mures court
781/85/2014 Sibiu
Court of Law
(Bucuresti Court
of Law file no.
28323/3/2014
11688/85/2012 –
Sibiu Court of
Law
Next
procedural
deadline
stay of trial
proceedings
Case
Plaintiff
Defendant
Amount
(RON)
Description
Romgaz - plaintiff
Claims
payment, contract
provision
worksno.14/2009
-undue
for
of
Claims -undue payment Romgaz - plaintiff
SC INSPET SA; SC
Condmag SA; SC
Petrostar SA; SC
Industrial Trading
SRL - defendants
SC Condmag SA -
defendant
15,596,065
In the summons, SNGN ROMGAZ SA requested the court to compel
the defendants to pay jointly the amount of RON 15,596,065
representing the undue payment made related to contract no.14/2009
23,645,128
In the summons, SNGN ROMGAZ SA requested the court to compel
the defendants to pay jointly the amount of RON 23,645,128
representing the undue payment related to the contract for provision of
works no. 39/2007
stay of trial
proceedings
claims (equivalent value
of delivered and unpaid
natural gas, according
to gas sale-purchase
contract no. 2/2010)
insolvency proceedings
Romgaz - plaintiff
SC G-ON Eurogaz
SRL - defendant
11,920,527.50
Claimed amount: RON 11,920,527.50 (equivalent value of delivered
and unpaid natural gas)
compulsory
enforcement
Romgaz - creditor
SC MAVEXIM SRL -
debtor
The trial date of June 25, 2013 allowed the debtor’s request to file for
insolvency (in compliance with art. 27 paragraph 5 of law 85/2006).
The debtor initiated insolvency procedures.
May 17,
2017
Corruption
offence
criminal
Romgaz - plaintiff
claiming damages
Budan Marcel -
defendant
Claims
Romgaz - plaintiff
Electrocentrale
-
Bucuresti
SC
SA
defendant
Romgaz - plaintiff
SC
GRUP
defendant
TEHNOTOP
-
SRL
579,532 Criminal complaint for investigating Mr. Budan Marcel for corruption
charges (Law 78/2000) in connection with repair works to the access
road to Schela Corunca. By filing letter JE166/01.04.2013 SNGN
ROMGAZ SA became injured party in the file for the amount of RON
579,532. The reason why Romgaz became injured party is the fact that
the work was recorded as fixed asset in Romgaz-Mures Branch
accounting records, a fixed asset over which it retains no title.
Amount of claim: RON 240,280,906.05
240,280,906
appeal,
currently not
established
March 6,
2017
112,139.15
Amount of claim: RON 112 139. 15. The compulsory enforcement
proceedings were initiated.
finalised
4
No.
24
File No./ Court of
Law
28218/3/2009 -
Mures County
Court of Law
25
26
27
28
921/237/2013 -
Gura Humorului
Court of Law
5768/85/2013 -
Sibiu County
Court of Law
149/322/2014 -
Targu Secuiesc
Court of Law
1213/251/2012 -
Luduş Court of
Law
Case
Plaintiff
Defendant
Amount
(RON)
Description
965,612 Amount of claims: RON 965,612. Recourse is dismissed. Decision is
irrevocable.
Next
procedural
deadline
finalized
SC LORETO EXIM
SRL – respondent /
appellant
Romgaz-SIRCOSS
appellant / respondent
Romgaz-STTM
Tg
Mures (appellant)
complaint of violation
Romgaz SIRCOSS
- appellant
Inspectoratul pentru
Situatii de Urgenta
Suceava - respondent
claims - default fees
SC
PROD
plaintiff
ALLSTAR
-
SRL
Romgaz (SIRCOSS) -
defendant
1,750 Amount of claim: RON 1,750
finalised
13,744,98 Amount of claim : RON 13,744.98
finalized
complaint of violation
ISCTR - respondent
SNGN Romgaz SA -
de
Sucursala
Energie
Producţie
-
Electrică
defendant
Iernut
Romgaz
(SIRCOSS)
appellant
-
Tegla
Ciprian,
Crişan Flaviu, Timar
Romul,
Marian
Maftei
Niculina,
Petru, Rădulescu
Gheorghe, Stoica
Nicuşor,
Cosma
Călin, Mathe Geza
and Pantea Ilie –
plaintiffs
(employees
of
SNGN Romgaz SA
– SPEE Iernut)
4,000 The complaint of violation requested the annulment of Offence Report
and of the contravention sanction and, alternately, the replacement of
fine with a warning.
finalized
36,000 Amount of claims: approx. RON 36,000, appeal, pending trial date
SPEE Iernut employees, as tenants of work-related lodging, requested
the court of law to:
Currently
not
established
-
-
-
Calculate rent according to Law no. 17/1994, Law no.
114/1996, GEO 40/1999, Government Decision no. 310/2007
and the New Civil Code.
set the reimbursement of amounts paid as rent, in excess of
the threshold of computed rent, starting with august 2009
until the final settlement of this cause.
Compel the defendant to pay court fees;
In the course of court proceedings, the defendants Marian Niculina and
Radulescu Gheorghe filed a request to waive court proceedings.
5
Case
Plaintiff
Defendant
Amount
(RON)
Description
No.
29
File No./ Court of
Law
1855/251/2013 -
Luduş Court of
Law
eviction proceeding
SC Comindal Impex
SRL - defendant.
SNGN Romgaz SA
- Sucursala
de
Producţie Energie
Iernut –
Electrică
plaintiff
30
261/43/2013 –
Appeal Court of
Law in Tg. Mures
The Bid Awarding
Report was challenged
SC Comindal Impex
SRL – appellant.
Romgaz - Sucursala
de Producţie Energie
Electrică
-
respondent
Iernut
Next
procedural
deadline
compulsory
enforcement
finalised
Based on bilateral relationship between the parties, the
lease
agreement no. 1294/2006 was concluded. Because on June 30, 2013,
the lease agreement had expired for the commercial premises located
in Iernut, P-ta 1 Decembrie 1918, bl. 1, groundfloor, Mures county,
SPEE Iernut organized on June 21, 2013 an open tender. The
appointed winner was PFA Cormos Daniela.
-
On June 21, 2013, SPEE Iernut organized an open tender for the lease
of the commercial premises located in Iernut, P-ta 1 Decembrie 1918,
bl. 1, groundfloor, Mures county. Three persons subscribed to the
tender among which the appellant, SC Comindal Impex SRL. The
appointed winner was PFA Cormos Daniela. SPEE Iernut rejected the
challenge filed by SC Comindal Impex SRL. For this reason, it
requested the court to cancel the Bid Awarding Report no. 5635/June
21, 2013 and to reorganize the tender. It invoked lack of compliance
with the Technical Specifications.
31
32
33
34
1471/63/2010Dolj
County Court of
Law
16181*/215/2009
- Craiova Court of
Law
Establish
right
Specific
procedure
easement
Romgaz - SISGN
Ploiesti - plaintiff
Draghici Marian and
others - defendants
Dolj Court of Law declined the competence in favour of Craiova Court
file no.18150/215/2010) which dismisses the action.
currently not
established
performance
Covei Gheorghe -
plaintiff
Romgaz
Ploiesti -defendant
- SISGN
169,938 The plaintiff filed an application to compel SNGN ROMGAZ SA –
SISGN Ploiesti to decommission the pipelines allegedly undercrossing
the plaintiff’s land and to pay the value of absence of usage right of
due to said pipeline. Amount of claim: EUR 37.764
Initially, the file was pending before Craiova Court of Law, which
dismissed the request.
finalised
1540/215/2013 -
Craiova Court of
Law
12310/63/2011 -
Dolj County Court
of Law
Prunoiu Gheorghita
- plaintiff
Romgaz
Ploiesti - defendant
- SISGN
Constantin Victoria -
plaintiff
Romgaz
Ploiesti - defendant
- SISGN
50,000 The plaintiff filed an application to compel SNGN ROMGAZ SA to pay
RON 50,000.
79,020
Amount of claim: EUR 17.560. The plaintiff filed an application to
compel SNGN ROMGAZ SA to decommission the pipelines allegedly
undercrossing the plaintiff’s land.
stay of trial
proceedings
stay of trial
proceedings
6
No.
35
File No./ Court of
Law
2471/215/2012 –
Craiova Court of
Law
36
37
38
39
40
1463/108/2012 –
Arad Court of Law
10980/320/2008 –
Tg. Mures Court
of Law
488/251/2008 –
Ludus Court of
Law
4424/320/2009 –
Tg. Mures Court
of Law
302/317/2014 –
Tg. Carbunesti
Court of Law
41
17666/320/2010 –
Tg. Mures Court
Of Law
Case
Plaintiff
Defendant
Amount
(RON)
Description
Romgaz – SISGN
Ploiesti – plaintiff
Zamfiroiu Florina s.a.
– defendant
Romgaz – SISGN
Ploiesti – creditor
SC Amarad SA –
debtor
Sipos Ioan –
plaintiff
Petrea Zachei,
Petrea Cornelia –
plaintiffs
Romgaz - Suc. Tg.
Mures – defendant
(and plaintiff
counterclaim )
Romgaz - Tg. Mures
Branch– defendant
Sipos Ioan ; Sipos
Terez – plaintiffs
Romgaz - Suc. Tg.
Mures – defendant
Daianu Maria –
plaintiff
Romgaz - Suc. Tg.
Mures – defendant
4,875 The defendant paid by mistake to Beldiman Ion (subsequently
deceased) the amount of RON 6500 as of June 27, 2008. As a
consequence, the company undertook actions to recover the amount
and, in accordance with the provisions of Articles 1092, 992 and 993
Civil Code, the Court compelled the defendant Beldiman Rodica, as
inheritress (wife) to refund the above mentioned amount.
The defendant filed recourse for this decision. At that moment, it was
found that besides the defendant Beldiman Rodica there are 4 more
legal successors, the deceased’s daughters (Zamfiroiu Florina, Barcu
Tita, Burtea Petria Georgeta and Ciumuliga Ionela) being defendants
to this case.
Upon the debtor’s request, prepared in accordance with the provision
of Article 27, paragraph 5 of Law 85/2006, insolvency procedures were
initiated.
42,418.48
Next
procedural
deadline
reinstateme
nt
March 23,
2017
450 By summons, the plaintiff requested the court to compel the defendant
to pay rent in exchange of using the land, which is the property of
plaintiff.
stay of trial
proceedings
20,000
By summons, the plaintiffs requested the court to establish the property
title in connection with an unincorporated parcel of 11,600sq.m.
File suspended until the irrevocable decision of file no. 487/251/2012*
stay of trial
proceedings
20,600 By summons, the plaintiffs requested the court to compel the
defendant to the payment of rent in exchange for using a land parcel,
the property of defendants (EUR 4,400).
stay of trial
proceedings
22,500 The defendant is compelled to pay to the plaintiff a compensation of
RON 9,216 representing the equivalent value of production made
during 2011, 2012, 2013. The defendant is obliged to pay the plaintiff
the amount of RON 2,625.8 as court fees. Appeal allowed on January
22, 2016.
finalised
Romgaz - Suc. Tg.
Mures – defendant
SC Network Press
Concept SRL
Medias (fosta
RODIPET) –
defendant
6,851.25 The defendant failed to meet the contractual obligation to deliver the
Romanian Official Journal for Q2 and Q3/2008: 4 subscriptions to Part
I bis and one subscription to Part IV, therefore the defendant is obliged
to refund RON 6,851.25 (out of which RON 565,70 is VAT). Currently
the case is suspended based on Article 36 of Law 85/2006 on
stay of trial
proceedings
7
No.
File No./ Court of
Law
42
3231/320/2011 –
Tg. Mures Court
of Law
43
44
7659/320/2011 –
Tg. Mures Court
of Law
claims
13525/320/2011 –
Tg. Mures Court
of Law
Case
Plaintiff
Defendant
Amount
(RON)
Description
Insolvency procedure.
Next
procedural
deadline
finalised
Cez Vanzare SA
Craiova –by
authorized
represenative
ROMANIA SRL –
creditor
Naghy Bela –
plaintiff
Romgaz - Suc. Tg.
Mures – debtor
5,534 Because of overdue payment of some invoices, the creditor requested
the court to compel the debtor to pay RON 5,112.85 (late payment
penalties) and RON 421.52 (court fees) in accordance with GD 5/2011.
As of June 28, 2011, Tg. Mures Court of Law dismissed the request for
payment. The decision is not communicated.
Romgaz - Tg. Mures
Branch– defendat
100,800 By summons, the defendant requested the court to oblige SNGN
finalised
ROMGAZ SA Tg. Mures Branch to pay:
- RON 100,800 representing rent expenses (for 3 years) for the
occupation of land by Well Cluster 8 Ulies (property of the defendant)
Sipos Ioan -
plaintiff
Romgaz – Suc. Tg.
Mures – defendant
45
198/315/2012 –
Targoviste Court
of Law
Nicolescu Georgeta
– plaintiff
Romgaz – Suc. Tg.
Mures – defendant
request
annulled
finalised
39,250 By summons, the plaintiff requested the court to oblige SNGN
ROMGAZ SA – Suc. Tg. Mures to pay EUR 8,500, a retroactive claim
(EUR 100/ month x 85 months) and as of October 26, 2011 to pay
EUR1,000/month as rent.
The summons grounds on the fact that the plaintiff cannot use a 2,800
sq.m parcel of land due to conditions imposed by Romgaz-Mures
Branch, which has 2 wells in the respective land. The first instance
dismissed the summons. The decision was not communicated. Claims:
EUR 8,500 (retroactively) and EUR 1,000/month for the future.
On October 15, 2012 Targu Mures Court of Law annulled the
summons. The decision has not been communicated.
96,940 By summons, the plaintiff requested the court to compel SNGN
ROMGAZ SA – Tg. Mures Branch
to pay RON 96,940 as
compensation for decreasing the value of the land use from II category
to IV category. The plaintiff’s claims are grounded on the fact that
Romgaz-Tg Mures Branch did not entirely fulfil the obligations to
restore land to its initial use (land where well 1 Iazu was drilled), as
established in court decision no. 4646/October 28, 2009 (irrevocable)
issued by Targoviste Court of Law in case file no. 438/315.2008.
Claims: RON 96,940.
On June 3, 2013 the court partly allowed the claim, compelling
Romgaz – Tg. Mures Branch to pay RON 2,510 as compensation and
RON 1,540 as court fees. Romgaz-Tg. Mures paid both amounts.
8
No.
46
File No./ Court of
Law
487/251/2012* –
Ludus Court of
Law
Case
Plaintiff
Defendant
Amount
(RON)
Description
Romgaz – Suc. Tg.
Mures – plaintiff
Bartha F. Irina; Local
Commission for
application of Law
18/1991 within Zau de
Campie city hall;
OCPI Mures;
County Comission for
application of Law
18/1991 within
prefecture Mures –
defendant
47
493/251/2012 –
Ludus Court of
Law
Romgaz – Suc. Tg.
Mures – palintiff
Petrea Zachei; Petrea
Cornelia – defendant
Next
procedural
deadline
stay of trial
proceedings
By summons, SNGN ROMGAZ SA – Suc. Tg. Mures requested the
court to establish absolute nullity (relative) and the relative nullity of the
property title no 132498/2002, by which the property title was re-
enacted for Bartha F. Irina over an arable land of 11,600 m2, located in
village Barbosi, commune Zau de Campie, due to the fact that 426 m 2
was erroneously included in the property title. In fact, the property title
was issued on behalf of Bartha Irina with the aid of the defendants 2, 3
and 4. There was an expropriation order for the land according to
Decrees 658/1973, 55/1978, 22/1979 and the land was removed from
the agricultural use. It could not fall within the scope of Law 18/1991.
Subsequently, the defendant disposed of this land by means of selling
it to Petrea Zachei and Petrea Cornelia, according to authenticated
contract no. 18/1991. The latter have petitioned the court against
Romgaz-Tg. Mures Branch for claims. The issuance of a property title
in connection with the surface occupied by the Branch’s assets is not
legal.
- By summons, SNGN ROMGAZ SA – Suc. Tg. Mures requested the
court to establish the absolute nullity of land sale contract no.
123/2005; the defendants are the buyers. The summons is grounded
on the fact that the authenticated sale contract no. 123/2005 is void
because is a subsequent act of the seller’s property title (please refer
to case file no. 487/251/2012 – Ludus Court of Law. Following the
procurement of land, the defendants filed a claim against Romgaz –
Tg. Mures Branch (file case no. 448/251/2008 – Ludus Court of Law).
Currently, this case
487/251/2012 of Ludus Court of Law is irrevocably settled.
is on stay of proceedings until case file
48
5423/320/2012 –
Kemeny Elena
Antonia – plaintiff
Romgaz – Suc. Tg.
Mures – defendant
200,000 By summons the plaintiff requested the court to decide: value of
finalized
claims: RON 200,000.
By the date of trial, December 19, 2014, the court dismissed the
request. The plaintiff initiated appeal –Mures County Court of Law. By
the date of trial, June 09, 2015, the appeal was dismissed. The
decision is final.
49
7399/320/2012 –
Tg. Mures Court
of Law
CEZ Distributie SA
Craiova, by
authorized
Romgaz – Suc. Tg.
Mures – debtor
1,344.74 By summons, the creditor requested the recovery of claims of RON
1,344.74 resulting from invoices regarding regularization of electricity
consumption in several consumption points within SPG Oltenia. Value
9
No.
File No./ Court of
Law
Case
Plaintiff
Defendant
Amount
(RON)
Description
Next
procedural
deadline
representative
COFACE
ROMANIA CREDIT
MANAGEMENT
SRL – creditor
Barsan Romulus -
plaintiff
of claims: RON 1,344.74.
By the date of retrial, April 16, 2015, Tg. Mures Court of Law dismissed
the request.
Romgaz – Suc. Tg.
Mures – defendant
88.000 By summons the plaintiff requested the court to compel the payment of
the following claims: RON 80,000; RON 30,000; RON 3,000/month;
RON 88,000.
March 28,
2017
Romgaz – Suc. Tg.
Mures – plaintiff
Borda Alexandru –
defendant
50
51
7070/320/2012 –
Tg. Mures Court
of Law
963/85//2013 –
Sibiu Countu
Court of Law
1,307 The case consists of obliging the defendant to refund the plaintiff the
amount of RON 1,304 representing the holiday allowance and the
holiday remuneration for the period he didn’t work and received holiday
leave, because after effectuating the holiday leave for the year 2012
(34 days) in March and May 2012, the defendant had a number of 32
(working days) of unjustified absences, which lead to his disciplinary
dismissal. Court allowed the action. The enforcement order over the
defendant has been initiated.
By summons, the plaintiff requested the court to oblige SNGN
ROMGAZ SA-Tg. Mures Branch to pay compensations (to be
subsequently settled by expertize) for lack of using the land of 1,221.5
m2 (during the period July 2010-July 2013) and for contaminating and
damaging the plaintiff’s piece of land by a group of crossings valves
belonging to the defendant and located on the plaintiff’s land.
The summons was allowed on May 12, 2014. The decision has not
been communicated yet.
52
4320/328/2013 –
Turda Court of
Law
Claims –
compensations
Lasonti Doina Maria
– plaintiff
Romgaz – Suc. Tg.
Mures – defendant
claims- compensations
53
54
11278/320/2013 –
Tg. Mures Court
of Law
6774/85/2013 –
Sibiu Court of Law
Romgaz – Suc. Tg.
Mures – defendant
Romgaz – Suc. Tg.
Mures – plaintiff
Serb Neli – plaintiff
5,200 By summons, the plaintiff requested the court to oblige SNGN
finalised
ROMGAZ SA-Tg. Mures Branch to pay the amount of RON 5,200
SC ICPE
ELECTROCOND
TECHNOLOGIES SA
– defendant
SC ENER- G
NATURAL POWER
LIMITED – defendant
SC INSTASERVICE
441,399 Value of claims: RON 441,398.85 (delay penalties), the enforcement
procedure has been suspended, payment in accordance with the
agreement on payment installments.
By summons, Romgaz-Tg Mures Branch requested the court to
compel the defendants to jointly pay RON 441,398.85, representing
default penalties calculated for the late fulfillment of obligation to
commission two pieces of equipment under the scope of contract no.
11/P/2011 concluded between the plaintiff and the defendants.
The case was allowed. The defendants filed for appeal at Alba Iulia
Court of Appeal.
finalised
10
No.
File No./ Court of
Law
Case
Plaintiff
Defendant
Amount
(RON)
Description
SRL -defendant
Next
procedural
deadline
3164/330/2013 –
Urziceni Court of
Law
Payment order ( article
1013 and Civil
Procedure Code
Romgaz - Suc. Tg.
Mures – Plaintiff-
creditor
SC FER MINERVA
SRL – defendant
debtor
4,361.88 By summons for issuance of a payment order for recover the amount
RON 4,361.88 out of which RON 3,896.79 (metallic waste invoices)
and RON 465.09 (delay penalties).
compulsory
enforcement
55
56
57
58
14630/320/2013 -
Tg. Mures Court
of Law
Complaint of violation
Romgaz - Suc. Tg.
Mures – plaintiff
Comuna Raciu –
through mayor –
defendant
1403/3/2014 –
Bucuresti Court
of Law- declined
its competency to
Sector 6 Bucuresti
Court of Law
4465/317/2013 –
Tg. Carbunesti
Court of Law
Annulment of
administrative act
SNGN ROMGAZ
SA- Suc. Tg. Mures
– plaintiff
Agentia Nationala de
Cadastru si
Publicitate Imobiliara
– defendant
Specific performance
procedure
Durla Sabina –
plaintiff
Romgaz - Suc. Tg.
Mures - defendant
59
1434/1371/2007
Mureş Comercial
Court of Law
Insolvency procedure
Romgaz – STTM
Tg.Mureş – Creditor
SC Poliglot
Comimpex SRL -
Debtor
11
50,000 SNGN ROMGAZ SA – Suc. Tg. Mures filed a complaint against the
Violation Notice and requested the enforcement of violation regarding
the construction-demolishing (of 2 cooling towers of Compressor
Station Sanmartinu de Campie) without a demolishing authorization.
By complaint the plaintiff requested the court to replace the fine of
RON 50,000 with warning or the minimum fine provided by law, namely
RON 1,000.
On the trial date, May 28, 2014, the complaint was dismissed.
SNGN ROMGAZ SA filed appeal at Mures County Court of Law.
Appeal was dismissed.
finalized
13,879.72
finalised
54,000 By summons, the plaintiff requested the court:
finalised
-
-
value of claims: RON 54,000;
compelling the defendant to sign with the plaintiff a land
lease
6,783.41 As of November 22, 2007, Mures County Court of Law allowed the
request for initiating the insolvency procedure against the debtor SC
Poliglot Coninpex RL. During November 22, 2007- July 08, 2010 the
insolvency procedure was carried out. STTM Tg. Mures is a creditor
included in the body of creditors with the amount RON 6,783.41.
May 25,
2017
No.
60
61
62
63
64
File No./ Court of
Law
7/1371/2009 al
Mureş
Commercial Court
of Law
580/1371/2010 –
Mures
Commercial Court
of Law
12236/320/2012 –
Tg. Mures Court
of Law
3295/104/2013 –
Olt County Court
of Law
2247/200/2015–
Buzau Court of
Law
Case
Plaintiff
Defendant
Amount
(RON)
Description
Romgaz –STTM
Tg.Mureş – creditor
SC Coriz SRL, by
liquidator Chertes
Constanta - debtor
Romgaz – Suc.
Medias – creditor
SC Globe Trotters
SRL – debtor
Romgaz – Suc.
Medias – plaintiffs
SC Torpi SRL; SC
Manadas SRL –
defendands
1,451.52 STTM Tg. Mures as creditor is included in the body of creditors with
the amount of RON 1,571.82.
9,206.21 Value of claims: RON 9,206.21
11,575.52 Value of claims: RON 11,575.52
Next
procedural
deadline
finalised
March 8,
2017
stay of trial
proceedings
Insolvency procedure
Romgaz – Suc.
Medias – creditor
SC MIC PETROCHIM
INDUSTRIE SRL
Ganeasa – debtor
505,02 Value of claims: RON 505.02 (RON 460.66 - unpaid invoice
+penalties). Court passed Decision no. 777/2016 dated November 28,
2016 which was not communicated. Possibility to file recourse
Complaint of violation
Romgaz – Suc.
Medias – appellant
ISCTR Bucuresti -
respondent
3,000 The complaint of violation against the Violation Notice and payment of
sanction in amount of RON 3,000 for unlabeled condensate gas
transportation.
The complaint is allowed. The civil fine sanction was replaced with a
warning. The decision is not final. Appeal was not allowed.
finalised
65
119/829/2014 –
Podu Turcului
Court of Law
Statutory burglary-
condensate removal
Romgaz – Suc.
Medias – plaintiff
claiming damages
Stratulat, Mihoci,
Grigoras – defendant
the stolen condensate was
363.20 The file was settled by convicting the defendants and compelling the
defendants to return the goods. The loss has been recorded due to the
fact
to Romgaz
that
representatives.
Against this decision, the public prosecutor appealed. The Court of
Appeal allowed the appeal with respect to custodial sentences and
maintained the other dispositions of the appealed decision. The
decision is final.
returned
66
3128/257/2013 –
Medias Court of
Law
Claims
Romgaz – plaintiff
Asociatia sportiva
“Dacia Atel” –
defendant
6,247.77 By summons, the court is requested to establish the termination of the
Sponsorship Contract no. 178/2011 and, as a consequence, to restore
the parties to their initial state by obligating the defendant ASOCIATIA
SPORTIVA “DACIA ATEL to pay RON 6,247.77, RON 5,000 as
financial support provided under Contract 178/2011.
compulsory
enforcement
12
Case
Plaintiff
Defendant
Amount
(RON)
Description
No.
67
File No./ Court of
Law
3127/257/2013 –
Medias Court of
Law
68
5026/85/2013 –
Sibiu County
Court of Law
claims
Romgaz – plaintiff
compensations
Romgaz – plaintiff
3035/262/2014 –
Moreni Court of
Law
claims – recourse
action
Romgaz - STTM
Targu Mures:
plaintiff
611/102/2015 –
Mures County
Court of Law
Challenging of decision
disciplinary sanction
Moldovan Ionel:
plaintiff
Asociatia
transparenta deciziei
administrative Medias
– defendant
Paltan Radu Dan –
defendant
Enache Ilie:
defendant (employee
of STTM Targu
Mures)
Romgaz - STTM
Targu Mures:
defendant
33727/197/2014 -
Brasov Court of
Law
2629/317/2015 -
Targu Carbunesti
Court of Law
Payment injunction
Complaint of violation
Romgaz - STTM
Targu Mures:
plaintiff
Romgaz - STTM
Targu Mures:
appelant
SC Suppliers Concept
SRL: defendant
ISCTR Bucuresti
(State Inspectorate for
Control of Road
Transportation):
respondent
13
69
70
71
72
Next
procedural
deadline
compulsory
enforcement
compulsory
enforcement
2,926.64 By summons, the court is requested to establish the termination of the
Sponsorship Contract no. 8/February 25, 2010 and, as a consequence,
to restore the parties to the initial state by obligating the defendant
ADMINISTRATIVE
ASOCIATIA
MEDIAS” to pay the amount RON 2,926.64.
“TRANSPARENTA DECIZIEI
4,681.01 By summons, SNGN ROMGAZ SA requested the court to incur
property liability of Mr. Dan Paltan, former employee of SNGN
ROMGAZ SA, and, as a consequence, to compel him to pay RON
681.01 paid by SNGN ROMGAZ SA pursuant to Article 192, paragraph
1, letter d) of CCM, supplemented with inflation rate until the payment
in full of the amount.
16.725,40 The scope of the case file is the settlement of recourse action in
connection with claims amounting RON 16,725.4. On the trial date,
May 28, 2015, the court reserved judgement. Judgement was
successively postponed for July 7, 2015. The plaintiff’s request was
allowed.
The scope of the case file is the settlement of the challenge filed by the
finalised
plaintiff against the disciplinary sanction.
On May 26, 2015, the court allowed the request and annulled the
sanctioning decision and compelled Romgaz to the payment of
amounts withheld as a result of the decision and the payment of court
fees of RON 2,500. The decision is not communicated.
1.275,89 The scope of the case file is the settlement of the request to issue a
finalised
payment injunction for RON 1,275.89.
On February 24, 2015, the request was dismissed. The decision was
not communicated.
7.000,00 The scope of the case file is the settlement of the complaint of violation
filed by STTM Targu Mures against Offence Report no. 51280019/April
28, 2015 setting the fine of RON 7,000 lei. Appeal allowed to ISCTR.
finalised
Case
Plaintiff
Defendant
Amount
(RON)
Description
No.
73
File No./ Court of
Law
3479/102/2014 -
Mures County
Court of Law
Claims, wage-related
rights
Sindicatul "Extractie
Gaze si Servicii"
Targu Mures:
plaintiff
Romgaz: defendant
74
2382/257/2014 -
Medias Court of
Law
Complaint of violation
Romgaz: appelant
Autoritatea Nationala
de Reglementare in
Domeniul Energiei:
defendant
75
3626/102/2014 -
Mures County
Court of Law
Damages: wage-related
rights
Ilinca Dan Claudiu:
plaintiff
Romgaz: defendant
76
3104/85/2014 -
Sibiu County
Court of Law
Public procurement
related litigation
Romgaz plaintiff
77
3625/102/2014 -
Mures County
Court of Law
Reimbursement of
monetary differences
resulting from wage-
related rights
Ilinca Dan Claudiu:
plaintiff
S.C. ICPE
Electrocond
Tehnologies S.A.,
Energ Natural Power
Limited, S.C.
Instaservice S.R.L.:
defendants
Romgaz: defendant
14
By summons the plaintiff requested the court to compel Romgaz to
make an indexation of the wages of the plaintiff syndicate members as
of November 1, 2013.
Summons dismissed – Decision no. 150/February 5, 2015
The plaintiff filed an appeal to Tg Mures Court of Appeal. On May 14,
2015 (trial date) the appeal was dismissed.
Decision is final.
500.000,00 The scope of the case file is the settlement of the complaint of violation
filed by Romgaz whereby the annulment of ANRE Offence Report no.
40475/June 30, 2014 was requested and, alternately, the replacement
of fine with a warning. On the trial date September 29, 2014, Medias
Court of Law allowed the complaint and decided to replace the fine
with a warning.
ANRE filed an appeal with Sibiu County Court of Law.
On April 7, 2015 the appeal was allowed and the complaint was
dismissed. The Decision is final.
In the summons the plaintiff requested the court to compel Romgaz to
the payment of:
- inflation-adjusted damages and legal interest as of September 2014
in relation to the allowance representing the equivalent value of
7,500m3 of gas, of each of Christmas, Easter and Gas Worker’s Day
allowance and of court fees.
Summons dismissed. Appeal was filed with Tag. Mures Court of
Appeal. Appeal dismissed.
1.139,00
274.900,60 Romgaz requested the court to compel the defendants to the joint
updated payment of RON 274,900.60 representing the prejudice
caused to Romgaz representing the equivalent value of electricity
generation not made during December 16, 2013-January 14, 2014 and
to the payment of court fees.
1.743,75
In the summons, the plaintiff requested the court to compel Romgaz to
reimburse wage-related monetary rights for September-November
2014 the inflation-adjusted amount of RON 1,743.75 and legal interest
until date of actual payment and to the payment of court fees.
On March 24, 2015, the trial date, the request was dismissed. Appeal
was files with Tg. Mures Court of Appeal. Also the defendant filed an
appeal against the reasoning of the judgement decision. The plaintiff’s
Next
procedural
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finalised
finalised
January 31,
2017
final
No.
File No./ Court of
Law
Case
Plaintiff
Defendant
Amount
(RON)
Description
appeal was dismissed.
78
1794/85/2014 -
Sibiu County
Court of Law
Adjustment of Work
Contract no.
233/September 26,
2012
S.C. Dafora S.A
Medias: plaintiff
Romgaz: defendant
3.840.149,47
plus TVA
79
3456/102/2014 -
Mures County
Court of Law
damages: wage-related
rights
Sindicatul “Extractie
Gaze si Servicii”
Targu Mures:
plaintiff
Romgaz: defendant
80
4093/85/2014 -
Sibiu County
Court of Law
Finding nullity of
provisions contained
under article 117 of the
Collective Labour
Contract in connection
with the holiday
allowance
Romgaz: plaintiff
Sindicatul Liber
Romgaz Romgaz
S.A.: defendant
15
In the summons, the plaintiff requested the court to establish the
adjustment of work contract no. 233/September 26, 2012 meaning the
increase of contract price by RON 3,840,149.47 plus VAT and to
compel Romgaz to the payment thereof. This amount represents the
equivalent value of additional and unforeseen works and the legal
interest.
Alternately, to compel Romgaz to pay RON 3,840,149.47 plus VAT as
damages for contract default, and the relating court fees.
The case benefitted from a technical and legal expertise in the field of
natural gas, the trial date was September 2, 2015 when the expertise
finding was filed. Appeal was filed. Response to appeal. Recourse
dismissed.
In the summons, the plaintiff requests the court to compel Romgaz to:
- granting and paying damages equivalent to the inflation-adjusted
holiday allowance according to Art. 117 par. 1) of Collective Labour
Contract no. 8400/28.02.2012 in force until July 31, 2014, and related
legal interest until the actual date of payment for the employees not
benefitting from the holiday allowance in July 2014;
- granting and paying damages equivalent to 70% of the inflation-
adjusted holiday allowance according to Art. 117 par. 1) of Collective
Labour Contract no. 8400/28.02.2012 in force until July 31, 2014, and
related legal interest until the actual date of payment for the
employees who did not benefit from such starting with August 2014;
- Court fees
On the trial date of April 30, 2015, the court decided to stay the
proceedings.
In the summons, the court was requested to find the nullity of Art. 117
of Collective Labour Contract regarding holiday allowance given the
issuance of Law no. 94/2014 for the approval of GED no. 8/2009 on
granting holiday tickets. The request was allowed on March 3, 2015,
The defendant filed for appeal at Alba Iulia Court of Appeal. Appeal
was granted.
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procedural
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Summons is
obsolete
finalised
No.
81
File No./ Court of
Law
3477/102/2014 -
Mures County
Court of Law
Claims: wage-related
rights
Case
Plaintiff
Defendant
Amount
(RON)
Description
Rus Maria: plaintiff
Romgaz: defendant
44.198,00
In the summons, the court was requested to:
Sindicatul Liber din
cadrul SNGN
ROMGAZ - defendant
82
48605/301/2014 -
Sector 3 Bucuresti
Court of Law
Claims
Romgaz: plaintiff
Asociatia Sprijin
Maternitatea Bucur:
defendant
5.000,00
Specific performance
83
1090/1371/2014 -
Mures County
Court of Law –
Commercial
Section
84
4760/102/2013 -
Mures County
Court of Law
Criminal court -
corruption (Law
78/2000)
Deusan Simion si
Maria; Bereczki
Francisc si Emilia;
Pahontu Dragos si
Nicoleta Diana :
plaintiffs
Romgaz -
Sucursala Medias:
injured party
Romgaz – Sucursala
Targu Mures:
defendant
Giurgea Teodor s.a.:
defendant
Next
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finalised
March 17,
2017
-
-
-
find the nullity of article 1 of the protocol concluded between
Romgaz and Sindicatul Prodserv Energetic Mures and of the
agreement concluded between Romgaz and Sindicatul Liber
SNGN ROMGAZ SA on March 1, 2014;
compel Romgaz to the payment of RON 44,198 as wage-
related monetary
(wage, holiday
allowance, gas allowance, retirement entitlements);
compel Romgaz to pay court fees.
rights not granted
The request was dismissed on February 18, 2015. The plaintiff filed an
appeal with Tg. Mures Court of Appeal. Appeal was dismissed due to
lack of grounds.
In the summons, the court was requested to establish the nullity of the
Sponsorship Contract no. 111/2014 and consequently, to:
- compel the defendant to reimburse RON 5,000 granted as financial
aid;
- compel the defendant to pay amounts representing the rate of
inflation and the legal interest relating for the period between the
payment date, June 21, 2013 and the repayment date;
- compel the defendant to pay court fees.
Request allowed - Decision 94/January 31, 2015. Right to appeal
within 30 days from the communication.
In the summons, the court was requested to compel Romgaz to:
- reinstate the land (private property) to its initial state;
- performance of protection works in relation to the decommissioned
well within a range of 20m from the well, not 50 as the defendant had
established as safety distance.
Tg. Mures Court of Appeal dismissed the appeal. Appeal filed.
In this case file, Romgaz – Sucursala Medias is injured party because
of its quality of creditor to SC Globe Trotters SRL, a company in
insolvency. In fact, the prejudice to Romgaz – Sucrusala Medias is due
to an agreement between the defendants and the directors of SC
Globe Trottes SRL for the creation of an unlawful assignment (by
making use of fictional documents).
85
2699/251/2014 -
Ludus Court of
Law
Eviction
Romgaz - SPEE
Iernut: plaintiff
SC Marele Alb
Prodimpex SRL:
defendant
The scope of file is the settlement of the eviction request initiated by
the plaintiff due to the fact that the defendant has late rent payments.
On May 7, 2015, the court allowed the request. The Compulsory
enforcement procedure was initiated.
16
No.
86
File No./ Court of
Law
1637/85/2014 -
Sibiu County
Court of Law
Case
Plaintiff
Defendant
Amount
(RON)
Description
Next
procedural
deadline
Challenging decision on
disciplinary sanctioning
Anton Dan:
contestator
Romgaz - SIRCOSS
Medias: respondent
87
88
89
90
3564/257/2014 -
Medias Court of
Law
3803/257/2014 -
Medias Court of
Law
Complaint of violation
Complaint of violation
Romgaz -
SIRCOSS Medias:
petent
Romgaz -
SIRCOSS Medias -
petent
CNADNR –
CESTRIN:
respondent
CNADNR –
CESTRIN:
respondent
770/284/2014 -
Racari Court of
Law
545/185/2014 -
Balcesti Court of
Law
Establishment of
easement right
Romgaz - SISGN
Ploiesti: plaintiff
Tudor Gheorghita
s.a.: defendant
Claims
Popa Elena: plaintiff Romgaz -SISGN
Ploiesti; Romgaz –
Sucursala Targu
Mures: defendant
91
15600/281/2014 -
Ploiesti Court of
Law
Claims
Tarca Ileana:
plaintiff
Romgaz - SISGN
Ploiesti: defendant
The scope of file is the settlement of the challenge against the
disciplinary sanction of the challenger. The respondent filed a
counterclaim to trigger the patrimonial liability of the challenger. The
challenge was dismissed on September 25, 2014. The counterclaim
was allowed and Decision no. 949/2014 of September 25, 2014 was
communicated.
The challenger filed for appeal at Alba Iulia Court for Appeal. The
appeal was dismissed. The Decision was final. Proceedings are made
to recover the amounts claimed in the counterclaim.
2.750,00 The scope of file is to settle the complaint of violation filed against the
finalised
Offence Report imposing the fine of RON 2,750 for lack of vignette.
Complaint was allowed. The fine was replaced with a warning.
250,00 The scope of file is to settle the complaint of violation filed against the
finalised
Offence Report imposing the fine of RON 250 for lack of vignette.
Complaint was allowed.
Complaint dismissed. Romgaz – SIRCOSS Medias filed for appeal at
Sibiu County Court of Law.
On the trial date, May 7, 2015, Sibiu County Court of Law allowed the
complaint and annulled the Offence Report.
The scope of file is to settle Romgaz request to establish easement
rights in order to gain access to wells 116 and 131 Bilciuresti.
Request dismissed in December 10, 2015. Romgaz filed for appeal.
The appeal was allowed.
30.000,00 Our company was sued for decommissioning pipelines which allegedly
undercrosss the plaintiff’s land and requests the court to compel the
defendant to the payment of the equivalent value of lack of land usage
– RON 30,000.
A technical expertise was ordered for this case file. Appeal was filed
with Valcea County Court of Law.
10.000,00 Our company was sued for decommissioning pipelines which allegedly
undercrosss the plaintiff’s land and requests the court to compel the
defendant to the payment of the equivalent value of lack of land usage
– RON 10,000.
Action allowed on the trial date set on June 16, 2015. The Defendant
was compelled to pay RON 4,611.68 (damages, stamp duty, expert
fee, legal counsel fee) and to reinstate the land to its initial state.
Appeal filed at Prahova County Court of Law. Appeal allowed. Final.
March 7,
2017
finalised
17
Case
Plaintiff
Defendant
Amount
(RON)
Description
No.
92
File No./ Court of
Law
16535/320/2014 -
Targu Mures
Court of Law
Claims
93
1208/1371/2014 -
Mures County
Court of Law
Claims
Romgaz - STTM
Targu Mures:
plaintiff
SC Rocada Serv
SRL: plaintiff
Bad Marcel Ioan:
defendant (former
employee of STTM
Targu Mures)
Romgaz - STTM
Targu Mures;
Romgaz - SPEE
Iernut; Romgaz:
defendant
94
221/85/2015 -
Sibiu County
Court of Law
Claims
SC Foraj Sonde SA
Craiova: plaintiff
Romgaz: defendant
95
35/102/2015 -
Mures County
Court of Law
Claims – undue
payment
Romgaz: plaintiff
Ilinca Dan Claudiu:
defendant
18
Next
procedural
deadline
finalised
finalised
Currently
not
establised
finalised
1.258,84 The scope of file is the settlement of claims amounting RON 1,258.84.
On March 18, 2015 (the trial date) the court declined its competrency in
favour of Tg. Mures County Court of Law. Romgaz request is
dismissed. Appeal was allowed by Tg. Mures Court of Appeal on
December 10, 2015.
1.674.003,60
24.045,92 The scope of file is the settlement of claims amounting RON 24.045,92
representing the equivalent value of transportation services provided
by the plaintiff, late payment penalties and court fees.
The court decided to introduce in this case file Romgaz and SPEE
Iernut as defendants. Stay of proceedings. Request dismissed on
November 10, 2015.
In the summons, the plaintiff requested:
- to compel Romgaz to adjust the work contract no. 311/2013
“Preparatory preliminary works, drilling and test at well Frasin 905” so
as to extend the work performance deadline and to increase the
contract price in connection with the accident no.2 Phase IV drilling of
well 905 Frasin in amount of RON 1,674,003.60 lei, including the legal
interest until the actual payment date;
- compelling Romgaz to the payment of court fees.
An expertise with speciality in the oil and gas field was ordered. The
request was dismissed. (Decision no. 1105/2016 of November 18,
2016). Rights to file a recourse
In the summons, Romgaz requested the court to:
- compel the defendant to pay the amount of RON 1,158 plus the
inflation adjustment until the actual date of payment, the amount
representing unpaid monetary rights unduly paid in August 2014 further
to the fact that the defendant did not sign the Addendum no.
22465/16/August 11, 2014 to the individual labour agreement no
9500/July 1, 2006;
- compel the defendant to pay court fees.
On the trial date of April 27, 2015 the court partly allowed the request
and compelled the defendant to pay RON 1,158 lei as undue wage-
related rights, amount to be adjusted by the inflation rate. Possibility to
appeal. The defendant files appeal which is dismissed by Tg. Mures
Court of Appeal. The amount was recovered.
1.158,00
No.
96
File No./ Court of
Law
205/102/2015 -
Mures County
Court of Law
Labour related
litigation- claims
97
151/102/2015 –
Mures County
Court of Law
Labour related
litigation- claims
Case
Plaintiff
Defendant
Amount
(RON)
Description
Next
procedural
deadline
finalised
Sindicatul "Extractie
Gaze si Servicii"
Targu Mures:
plaintiff
Tg. Mures
"Extractie Gaze si
Servicii" Trade
Union - plaintiff
Romgaz: defendant
Request dismissed.
Romgaz - defendant
In the summons, the plaintiff requested the court to compel Romgaz to
pay compensation in amount of the equivalent value of 312.5 m3 of gas
for the former employee Ilinca Alexandru, for the period March – April
2012, a value discounted by the inflation index and the statutory
interest until effective payment.
As of the trial date April 23, 2015, the summons was dismissed.
Appeal in 10 days of communication. Appeal partly allowed by the Tg.
Mures Court of Appeal on October 1, 2015. Final decision
98
7138/303/2014 –
Court of Law
Sector 6 Bucuresti
Suspension of
compulsory
enforcement
Interaction SRL -
appellant
Romgaz - respondent
Purpose of the claim is suspension of compulsory enforcement.
Claim allowed
SNGN ROMGAZ SA has appealed against the decision – Bucharest
Court of Law. Appeal dismissed
99
3591/303/2014 –
Court of Law
Sector 6 Bucuresti
Challenge of
compulsory
enforcement
Interagro SA;
Interagro SRL -
appellants
Romgaz - respondent
Challenge rejected (with reference to compulsory enforcement file
Cristian Milos no. 28/2014).
The appellants have filed for appeal – Court of Bucharest. As of the
trial date June 9, 2015 the appeals were dismissed.
100
122/57/2015 –
Alba Iulia Court of
Appeal
Litigation public
acquisition
Trade Union
Sindicatul Liber
SNGN ROMGAZ
SA- complainant
Romgaz - respondent
finalised
Complaint against the Decision CNSC issued in the course of the
public acquisition procedure "Elaborare studiu privind implementarea
unui sistem de management prin obiective si a unei politici de
remunerare bazata pe managementul prin obiective pentru personalul
de conducere din cadrul Romgaz" (Preparing a study for implementing
a management system by objectives and remuneration policies based
on management by objectives
the Romgaz members of
management).
On the trial date March 13, 2015, the complaint was dismissed. Final
decision
for
19
File No./ Court of
Law
Case
Plaintiff
Defendant
Amount
(RON)
Description
No.
101
48/267/2015 –
Novaci Court of
Law
Presidential Ordinance–
specific performance
procedure
Filip Floarea
Filip Zamfir
plaintiffs
Romgaz - Suc. Tg.
Mures - defendant
The plaintiffs requested the Court to compel SNGN ROMGAZ SA to
stop operation of well 83 Alunu.
Litigation was settled by Decision given in the Council Chamber on
the summons. Decision not
February 9, 2015
communicated
that annulled
In the summons, the plaintiffs did not specify the grounds de facto et
de jure of the summons. From the summons it results that the request
is to connect the case with File no. 48/267/2015 of the Novaci Court of
Law. The Court has given a term for the plaintiffs to specify their claim
and to indicate the grounds de facto et de jure for such claim.
On trial date April 28, 2015, the stay o fproceeding was ordered.
195,253.86 The scope of the dispute is the settlement of the claim for establishing
patrimonial liability and payment of compensation in amount of RON
195,253.86 to replace/ purchase 718.68 m of casing that is missing
inventory. Claim allowed. Decision not communicated.
The present file is separated from Case File no. 487/251/2015* (of
Ludus Court of Law) where it was listed as alternative head of claim
(establishing absolute nullity and annulment of land documentation
received by OCPI Mures under no. 1932/2006). Appeal dismissed on
May 26, 2016 due to lack of grounds
5,112
In the claim, the plaintiff requested the court to compel SNGN
ROMGAZ SA to pay the amount of RON 5,112 as compensation for
the plaintiff’s land degradation, effects on the fertility of the soil due to
technological
laying a well gathering pipeline
installation of well 21 Grebenis from well 214 Grebenis, without the
plaintiff’s agreement. Claim allowed. Right to recourse.
to separate
the
Next
procedural
deadline
finalised
finalised
finalised
finalised
Currently
not
established
102
49/267/2015 –
Novaci Court of
Law
Not specified
Filip Floarea
Filip Zamfir
plaintiff
Romgaz - Suc. Tg.
Mures - defendant
103
104
589/102/2015* -
Mures County
Court of Law
225/251/2015 –
Ludus Court of
Law
claims, compensation
Romgaz - SA Suc.
Tg. Mures - plaintiff
Kovacs Ladislau -
defendant
Establishing the nullity
of an act
Romgaz - plaintiff
105
2042/320/2015 –
Tg. Mures Court
of Law
claims - compensation
Chiciudean Vasile -
plaintiff
Bartha F. Irina; Local
Committee to Enforce
Law no. 18/1991
under the City Hall of
Zau de Campie; OCPI
Mures; County
Commission to
Enforce Law no.
18/1991 under the
Mures Perfecture –
defendant
Romgaz - Suc. Tg.
Mures - defendant
20
No.
106
File No./ Court of
Law
1081/1371/2014-
Tg. Mures Court
of Law
Payment ordinance
SC Ambient SA –
creditor plaintiff
Romgaz - STTM Tg.
Mures – debtor
defendant
Case
Plaintiff
Defendant
Amount
(RON)
Description
107
847/1285/2014 -
Cluj County
Specialized Court
of Law
Insolvency proceedings Romgaz - SPEE
Iernut - creditor
SC Marele Alb
Prodimpex SRL -
debtor
108
2738/251/2014 –
Ludus Court of
Law
claims - compensation
Romgaz - SISGN
Ploiesti - defendant
Tanase Rodica -
plaintiff
109
674/85/2015 –
Sibiu County
Court
Payment ordinance
Romgaz -
SIRCOSS - creditor
SC AMGAZ SA -
debtor
Next
procedural
deadline
May 12,
2017
130,496.59 The scope of the dispute is the settlement of the request to issue a
payment ordinance for the amount of RON 130,496.59 representing
claims made by Ambient pursuant to the debt assumption contract no.
121/ September 21, 2012 concluded between SC ATL Constructii SRL,
SC Ambient SA and Romgaz SA.
On the trial date April 16, 2015 the court dismissed the application.
Decision not communicated.
64,742 By the civil decision no. 101/16.01.2015, the specialized Court of Cluj
has decided to open the general insolvency proceedings against the
debtor. To recover the outstanding debt in amount of RON 64,742 (as
a result of the debtor’s failure to comply with the rental contract no.
10394/01.11.2010), SPEE Iernut was listed in the preliminary Table of
outstanding debts with the amount of RON 60,605.36 lei. Appeal was
filed.
8,837 The scope of the dispute is settlement of the claim by which the plaintiff
requested SNGN ROMGAZ SA to be compelled to decommission the
pipelines allegedly undercrossing the plaintiff’s land and to pay the
value relating to lack of land use.
For the case, a topographical expertise was ordered. On February 18,
2015, claim allowed. Appealed.
1,333.975.14 An order for payment was filed, and after the 15 days’ term, a request
was filed at the County Court of Sibiu.
On the trial date May 15, 2015, the Court partially allowed the request
and compelled the debtor to pay RON 781,921, dismissing the head of
claim referring to compelling the debtor defendant to pay the penalties
amounting to RON 484,694.70.
Decision not communicated. Subsequernt to the communication, a
remedy at
the amount
representing late payment penalties. Request partially allowed.
for recovering
law will be
formulated
110
93/43/2015 –
Tg. Mures Court
of Appeal
Revision of Decision in
Case File no.
1622/102/2013
Romgaz – applicant
for revision
Moldovan Ionel-
respondent
The scope of the dispute is settlement of the request for revision filed
by SNGN ROMGAZ SA regarding the Decision in case file no.
1622/102/2013.
On the trial date April 27, 2015, the request for revision was dismissed.
Final
21
No.
111
File No./ Court of
Law
3843/121/2014 –
Galati County
Court of Law
Case
Plaintiff
Defendant
Amount
(RON)
Description
Insolvency procedure
Romgaz - creditor
Electrocentrale Galati
SA - debtor
162,281,861.83 The subject matter of the case file is the settlement of the request filed
by the debtor SC Electrocentrale Galati SA, under Law no.85/2006 on
insolvency procedure. On June 16, 2014, the Court allowed the
application, decided to open the general insolvency procedure against
the debtor.
SNGN ROMGAZ SA
the
filed an application
outstanding debt in amount of RON 162,281,861.83 (equivalent value
of natural gas, penalties and interests). In relation to this amount to be
the body of creditors, only RON
included
139,056,681.91 was allowed by the liquidator of assets of SC
Electrocentrale Galati SA. Romgaz, as creditor, challenged the
preliminary table of receivables. (Currently, the challenges to the
preliminary table are on trial)
For subsequent procedure – trial date: June 15, 2015
to acknowledge
for Romgaz
in
Next
procedural
deadline
May 15,
2017
112
2246/303/2015 –
Court of Law
Sector 6 Bucuresti
challenge to
compulsory
enforcement
SC Interagro SA -
challenger
113
2859/320/2015 –
Tg. Mures Court
of Law
Specific performance
procedure
114
1352/102/2015 –
Mures County
Court of Law
Specific performance
procedure
Szabo Maria -
plaintiff
Szabo Maria
Matilda- intervener
on her behalf
Ban Onoriu, Ban
Maria Cristina -
plaintiffs
Romgaz - respondent
Challenge to the compulsory enforcement performed by BEJ Milos in
Romgaz - Suc. Tg.
Mures - defendant
Romgaz - Suc. Tg.
Mures - defendant
500 EUR/month
80,000 EUR -
compensation
the Enforcement Case File no.28/2014.
On the trial date March 18, 2015, the challenge was dismissed.
SC Interagro SA filed appeal –County Court Bucuresti. The appeal was
dismissed.
In the summons the plaintiff requested the Court to compel the
defendant to:
- decommission the pipelines laid on the land within her property
- authorize the plaintiff to perform such works at the expense of the
defendant (in case of refusal);
- payment of court fees. Plaintiff’s application dismissed
In the summons the plaintiff requested the court to compel the
defendant to:
- full decommission of well 18 Acatari (abandoned); or
- payment of a rent amounting to 500 EUR/month in case the
defendant refuses to decommission the well;
- payment of EUR 80,000 as compensation for land not used for the
purpose it was purchased for. Stay of proceedings
finalised
22
No.
115
File No./ Court of
Law
2190/257/2015-
Medias Court of
Law
Complaint of violation
Romgaz -
complainant
Case
Plaintiff
Defendant
Amount
(RON)
Description
Next
procedural
deadline
Currently
not
established
116
1765/85/2015 –
Sibiu County
Court of Law
challenge of public
acquisition
Sindicatul Liber
“ROMGAZ” –
appellant
117
1644/85/2015 –
Sibiu County
Court of Law
claims
Romgaz -
SIRCOSS Medias -
plaintiff
Inspectoratul de Stat
in Constructii -
defendant
Autoritatea Nationala
de Reglementare in
Domeniul Energiei
(Romanian National
Regulatory Authority
for Energy)-
respondent
Romgaz - respondent
75,000 The scope of the dispute is settlement of the complaint of violation filed
by SNGN ROMGAZ SA that requested, mainly, annulment of the
Finding Report and Sanctioning of Non-Criminal Offences no.
43376/June 11, 2015 prepared by ANRE, and, alternatively,
replacement of the fine sanction by a warning. Complainant’s
application allowed, responded entitled to appeal. Appeal filed
The scope of the dispute is settlement of the challenge filed against the
tehnical specifications prepared by ROMGAZ SA under the award
procedure of the contract for “Consultancy services for developing a
strategy for reorganizing and organization redesign of ROMGAZ SA”.
On the trial date of June 30, 2015, the challenge was dismissed. The
Decision was not communicated. Filed appeal was dismissed on
September 15, 2015
487.44 The scope of the dispute is settlement of claims for the recovery of
undue tax in amount of RON 487. 44. On the trial date of December
17, 2015 the application was dismissed. Appeal filed. Appeal
dismissed.
118
117
118
119
1532/1/2015 -
ICCJ
1644/85/2015 –
Sibiu County
Court of Law
1532/1/2015 -
ICCJ
1492/102/2015 –
Mures County
Court of Law
Corrupt payment
Romgaz – plaintiff
claiming damages
Rudel Obreja s.a. -
defendant
410,000
In the case file, SNGN ROMGAZ SA is plaintiff claiming damages in
amount of RON 410,000
March 13,
2017
claims
Corrupt payment
Challenge of
disciplinary sanction
decision
Romgaz -
SIRCOSS Medias -
plaintiff
Romgaz – plaintiff
claiming damages
Timar Romul -
plaintiff
Inspectoratul de Stat
in Constructii -
defendant
Rudel Obreja s.a. -
defendant
Romgaz - SPEE
Iernut - defendant
487.44 The scope of the dispute is the settlement of claims for the recovery of
undue tax in amount of RON 487. 44. On the trial date of December
17, 2015 the application was dismissed
In the case file, SNGN ROMGAZ SA is plaintiff claiming damages in
amount of RON 410,000
410,000
March 13,
2017
The challenge requested the annulment of Disciplinary Investigation
Decision no 137/2015 and the compellment of the defendant to pay the
amounts representing calculation differences with respect to base
salary due for May 2015, amounts withheld as a result of disciplinary
sanctions. The court allows the plaintiffs challenge. Appeal was filed.
Appeal was dismissed.
23
No.
120
121
122
123
File No./ Court of
Law
797/251/2015 –
Ludus Court of
Law
2899/62/15 –
Brasov County
Court of Law
1208/1371/2014
Targu Mures
Court of Law
28323/3/2014
Case
Plaintiff
Defendant
Amount
(RON)
Description
Payment injunction
procedure
Romgaz - SPEE
Iernut - plaintiff
SC Romarcom SRL -
defendant
40,002.40
In the summons, the court was requested to compel the defendant to
pay RON 40,002.04 representing the equivalent value of unpaid rent
and two public utilities invoices) for the buffet space rented to the
defendant. On July 17, 2015, the plaintiff request was dismissed with
entitlement to request annulment within 10 days. Request dismissed.
insolvency
Romgaz
SC Condmag SA
83,225,512.28 Recovery of undue payment found by the Court of Accounts
Next
procedural
deadline
March 28,
2017
claims
Romgaz
Rocada SRL
24,045.92 Decision was postponed to October 20, 2015. Tg. Mures County Court
finalised
of law annuls the decision. Final decision.
declaratory action
Romgaz
Elcen B
240,000,000 Request allowed. Decision was not communicated, it is possible for
Elcen Galati
162,281,861.83 Challenge of the nominal table
ELCEN to file for appeal
124
4783/121/2011
insolvency
125
126
127
128
129
1960/257/ 2015
2411/257/2015
509/1371/2015
complaint of violation
complaint of violation
insolvency
4488/317/2015
2496/102/2015
stay of execution
claims
130
847/1285/2014
insolvency
Romgaz
Romgaz
Romgaz
Romgaz
Romgaz
Romgaz
Romgaz
ANRE
ANRE
Foraj Sonde Ernei
Bej Daianu Ghe.
Kovacs Ladislau
SC Marele Alb SRL
turda
131
132
1208/1371/2014
1560/251/2015
claims
claims
Rocada SRL
Romgaz
Romgaz
Romarcom SRL
75,000 Request dismissed, appeal was filed. Appeal was dismissed
50,000 Decision pending. Appeal dismissed
1,428.98 First trial date. Insolvency procedure is continued.
13,891 First trial date. Romgaz request as allowed. Appeal was filed
318,881.96 Communication of Expert Opinion
64,742 Total receivables listed in the preliminary receivables table RON
60,605.36. The calculation difference of RON 4,136.64 is current
receivables
24,045.92 Dismisses the plaintiff’s request. Recourse annulled. Final decisions
62,972.85 The civil actions for claiming damages filed by Romgaz-SPEE Iernut
against SC Romarcom SRL is partially allowed and consequently:
-
-
-
the defendant is obliged to pay the plaintiff RON 16,605.35
as damages;
the defendant is obliged to pay the plaintiff RON 935
represening court fees.
SC Romarcom filed for appeal.
March 6,
2017
Case
postponed
May 17,
2017
finalised
March 23,
2017
May 12,
2017
finalised
Currently
not
established
Stay of
proceedings
Currently
133
134
28218/3/2009
3702/257/2015
litigation GEO 34/2006
Specific performance
Romgaz SA
Viromet SA
Loreto
Romgaz
431, 677 Dismisses the parties’ request on December 10, 2015
Court of first instance
135
8029/2/2015
Challenge of
Romgaz
ANAF Brasov
22,424,030 Bucharest Court of Appeal partially allows Romgaz action, with a right
24
No.
File No./ Court of
Law
Case
Plaintiff
Defendant
136
774/308/2016
administrative
document
Specific performance
137
775/308/2016
Specific performance
Topliceanu N.:
defendant
Romgaz - Sucursala
Medias
Moldovan Vasile:
defendant
Romgaz - Sucursala
Medias
138
8237/107/2012
Insolvency
139
5991/303/2016
Restitution procedure
Romgaz -
Sucursala Medias
Romgaz -
SIRCOSS
SC AgroValea Lunga
SRL: debtor
SC Loreto Exim SRL
Amount
(RON)
Description
to file an appeal within 30 days.
Equivalent
value of ordered
expertize
Equivalent
value of ordered
expertize
The defendant requests the registration in the Land Register 2500
Nades of the housing Nades canton, which Romgaz has sold by
means of Sale Contract no. 10723/December 9, 1997.
The defendant requests the registration in the Land Register 2500
Nades of the housing Nades canton, which Romgaz has sold by
means of Sale Contract no. 10724/09.12.1997, associated to Case File
no. 774/308/2016.
986.52 Equivalent value of unpaid invoice.
180,857.38 –
principal debt
60,080.82 –
ancillary debt
(legal interest)
Sector 6 Bucuresti Court of Law – action filed for restitution for the
recovery from SC Loreto Exim SRL of undue payment generating for
the defendant an unjust enrichment. The claim was partially allowed.
Right to appeal in 30 days from the communication date.
140
447/85/2016
labour related litigation
Nicola Lucian
Romgaz - SIRCOSS
1,000.00 The plaintiff Nicola Lucian challenged the suspension decision. Appeal
dismissed due to lack of grounds. Final.
141
927/85/2016
labour related litigation
Podar Nicolae
Romgaz - SIRCOSS
The plaintiff Podar Nicolae challenged the dismissal decision.
142
928/85/2016
labour related litigation
Dan Ioan
Romgaz - SIRCOSS
Dan Ioan filed with Sibiu County Court of Law a challenge against the
dismissal decision.
143
944/85/2016
labour related litigation
Lorincz Levente
Romgaz - SIRCOSS
Levente Lorincz filed with Sibiu County Court of Law a challenge
against the dismissal decision.
144
2206/85/2009
claims
SC GRANIT SRL
Romgaz - SIRCOSS
Relsease of contract performance guarantee in connection with the
145
2307/257/2016
complaint
8057/320/2016 -
Judecatoria Targu
Mures
claims
146
147
Romgaz -
SIRCOSS
SC Ambient SA:
plaintiff
9261/320/2016 -
Judecatoria Targu
Mures
unjust enrichment
SC Rocada Serv
SRL: plaintiff
CNADNR
3,000.00 SIRCOSS challenged the traffic violation report and relating fine.
work contract that has been implemented.
Appeal was filed.
Romgaz - STTM
Targu Mures:
defendant
Romgaz - STTM
Targu Mures:
defendant
25
130,496.59 The plaintiff requests the payment of RON 130,496.59 representing
outstanding payment obligations under the Debt Assumption Contract
no. 121/September 21, 2012 concluded with Romgaz-STTM, to which
the legal interest is added.
24,045.92 The plaintiff requests to compel the defendant to the payment of RON
24.045,92 representing the equivalent value of transportation services
supplied and not paid and relating late payment penalties applied
against the principal debt until the actual date of payment.
Next
procedural
deadline
not
established
April 3,
2017
April 3,
2017
April 24,
2017
Currently
not
established
Stay of
proceedings
Stay of
proceedings
Stay of
proceedings
Stay of
proceedings
Currently
not
established
Currently
not
established
March 3,
2017
File No./ Court of
Law
Case
Plaintiff
Defendant
Amount
(RON)
Description
No.
148
4083/105/2016 -
Tribunal Prahova
Annulment of tax and
duties control document
Romgaz - STTM
Targu Mures:
plaintiff
SPFL Ploiesti:
defendant
4,140.00 The plaintiff Rogan - STTM Targum Mores requested the annulment of
the taxes and duties control documents contained in Decision no
116440/17.11.2015 issued by Service Public Finance Locale Ploiesti
(Ploiesti Public Finance Local Office) in connection with the payment
obligation of accessories in relation to the taxation of the fixed asset -
Backhoe Komatsu, plate number PH-25-STM, the property of the
plaintiff. Request dismissed. Right to file recourse within 15 days from
the communication date of the decision.
452 The plaintiff requests the annulment of the Disciplinary Sanction
Decision no. 86/April 24, 2016 issued against employee Negrea
Alexandru Stelian employed as shipping-receiving clerk, establishing a
disciplinary sanction of reducing the monthly wages by 5% for a period
of 2 months. The Decision was issued by Romgaz - STTM Targu
Mures. Action dismissed. Right to appeal within 10 from
the
communication date.
1,064 The plaintiff requests the annulment of the Disciplinary Sanction
Decision no. 85/April 24, 2016 issued against employee Cotoi Ioan
Stefan employed as shipping-receiving clerk, establishing a disciplinary
sanction of reducing the monthly wages by 10% for a period of 2
months. The Decision was issued by Romgaz - STTM Targu Mures.
Action dismissed. Right to appeal within 10 from the communication
date.
63,811.09 The plaintiff requests the triggering of patrimonial liability of its
employee, employed as shipping-receiving clerk, by compelling him to
pay to Romgaz - STTM Targu Mures RON 63,811.09, representing a
prejudice due to inventory shortage caused by his negligence as
results from the Annual Inventory Report for STTM Tg. Mures 2015,
and the relating legal interest, until the actual date of payment.
2,069.46 Decision was not communicated for filing the appeal.
4,809.58 Recovery of receivables.
4,000.03 Recovery of receivables. Request is allowed.
64,742.00 Recovery of receivables.
Next
procedural
deadline
Currently
not
established
Currently
not
established
Currently
not
established
March 2,
2017
Compulsory
enforcement
March 2,
2017
149
1122/102/2016 -
Tribunal Mures
Challenge of document,
labour related litigation
Negrea Alexandru
Stelian: plaintiff
150
1123/102/2016 -
Tribunal Mures
Challenge of document,
labour related litigation
Cotoi Ioan Stefan:
plaintiff
Romgaz - STTM
Targu Mures:
defendant
Romgaz - STTM
Targu Mures:
defendant
151
1278/102/2016 -
Tribunal Mures
claims, action against
patrimonial liability
Romgaz - STTM
Targu Mures:
plaintiff
Cotoi Ioan Stefan:
defendant
152
153
154
389/102/2016
Tribunalul Mures
868/102/2016 -
Tribunalul Mures
3183/306/2016 -
Judecatoria Sibiu
claims
claims
claims
Romgaz - SPEE
Iernut: plaintiff
Romgaz - SPEE
Iernut : plaintiff
Romgaz - SPEE
Iernut : plaintiff
155
847/1285/2014 -
Tribunalul
Insolvency proceedings Romgaz - SPEE
Iernut: creditor
SC ECO RT SRL
Medias: defendant
SC Metal Divers Instal
SRL
SC Laromet Metal
Star-D SRL:
defendant
SC Marele Alb
Prodimpex SRL:
26
No.
File No./ Court of
Law
Case
Plaintiff
Defendant
Amount
(RON)
Description
156
157
specializat Cluj
1560/251/2015 -
Judecatoria Ludus
claims
Romgaz - SPEE
Iernut: plaintiff
9261/320/2016 -
Judecatoria Targu
Mures
Unjust enrichment
cauza
SC Rocada Serv
SRL
158
1335/251/2016 -
Judecatoria Ludus
claims
159
698/251/2016 -
Judecatoria Ludus
Claims, separated from
File Case no.
1855/251/2013
Romgaz - SPEE
Iernut: plaintiff
PFA Cormos
Daniela: plaintiff
509/1371/2015 -
Tribunalul
Comercial Mures
2899/62/2015 -
Tribunalul Brașov
Insolvency proceedings Romgaz: creditor
Insolvency proceedings Romgaz: creditor
6602/320/2015 -
Judecătoria Targu
Mureş
claims
Turcu Victoria:
plaintiff
debtor
SC Romarcom SRL:
defendant
Romgaz - SPEE
Iernut; Romgaz -
STTM; Romgaz:
defendant
PFA Cormos Daniela:
defendant
Romgaz - SPEE
Iernut: parat; SC
Comindal Impex SRL:
defendant
SC Foraj Sonde SA
Ernei: debtor
SC Condmag SA:
debtor
Romgaz - Sucursala
Targu Mures:
defendant
5451/320/2016 -
Judecatoria Targu
Mures
5452/320/2016 -
Judecatoria Targu
Mures
5453/320/2016 -
Judecatoria Targu
Mures
318/1371/2016 -
Tribunalul
Complaint of violation
Complaint of violation
Complaint of violation
claims
Romgaz -
Sucursala Targu
Mures: appellant
Romgaz -
Sucursala Targu
Mures: appellant
Romgaz -
Sucursala Targu
Mures: appellant
BSG Security SRL
Targu Mures:
Politia Municipiului
Targu Mures:
respondent
Politia Municipiului
Targu Mures:
respondent
Politia Municipiului
Targu Mures:
respondent
Romgaz - Sucursala
Targu Mures:
27
160
161
162
163
164
165
166
62,972.85 Recovery of receivables. Appeal filed by the defendant.
24,045.92 Recovery of receivables.
4,184.00 Recovery of receivables. Request allowed. Right to file an appeal
within 30 days.
150,000 Recovery of receivables.
1,428.98 Request to initiate insolvency proceedings.
3,291.41 Request to initiate insolvency proceedings.
30,288 plus
legal interest
Claims – outstanding rents for the land relating to access roads and
the well site for well no. 138 Șăușa amounting RON 30,288 and legal
interest during 2012-2014.
According to Decision no. 4551/September 30, 2016 the court takes
note of the transaction between the parties in amount of RON 27,172.
2,000 Complaint of violation against the offence report. The complaint is
partially allowed. Right to file an appeal within 30 days from the
communication.
2,000 Complaint of violation against the offence report. The complaint is
the
file an appeal within 30 days
from
to
dismissed. Right
communication.
2,000 Complaint of violation against the offence report. The complaint is
partially allowed. Right to file an appeal within 30 days from the
communication.
470,671.04 Claims arising in connection with the abusive termination of Security
Services Contract. The court takes note of the plaintiff’s waiver of court
Next
procedural
deadline
Currently
not
established
March 3,
2017
Currently
not
established
April 6,
2017
May 17,
2017
March 26,
2017
finalised
Currently
not
established
Currently
not
established
Currently
not
established
No.
File No./ Court of
Law
Comercial Mures
Case
Plaintiff
Defendant
Amount
(RON)
Description
Next
procedural
deadline
plaintiff
defendant
167
168
319/1371/2016 -
Tribunalul
Comercial Mures
627/102/2016 -
Tribunalul Mures
claims
corruption
LEX Guard Security
SRL Reghin:
plaintiff
Romgaz: injured
party and plaintiff
claiming damages
169
1828/251/2016 -
Judecatoria Ludus
Validation of
garnishment
Raiffeisen Bank
S.A.: creditor
Insolvency
Romgaz
Romgaz - Sucursala
Targu Mures:
defendant
Avram Pantelimon,
Olaru Ioan Tiberiu,
Mincan Emil Valentin,
Ştefan Ioan:
defendants
Romgaz - Sucursala
Targu Mures – tert
poprit, Chertes
Grigore Danut :
debtor
SC Termoelectrica SA
action. Decision no. 73/2016. Right to file recourse within 30 days from
the communication date.
126,483.91 Claims arising in connection with the abusive termination of Security
Services Contract. Action dismissed. Court issues no. 94/2016. Appeal
may be filed within 30 days from the date of communication.
Currently
not
established
146,637.06 Criminal action against corruption. The court dismisses the challenge
filed by Parchetul de pe langa ICCJ – DNA – Serviciul Teritorial Targu
Mures against the Criminal Case Resolution dated December 13, 2016
issued by Tg. Mures Court of Law due to lack of grounds. The
Reslution no. 72/2016 is final.
94,882.86 The garnished third party did not take the required measures specified
in the notice of garnishment.
42,665,005.29
Insolvency.
170
171
172
173
9562/3/2016 -
Tribunalul
Bucuresti
1801/85/2016 -
Tribunalul Sibiu
461/1371/2016 -
Tribunalul
Comercial Mures
681/57/2015
Challenging of
procedure to fill a
position
Insolvency
Toderici Simona
Romgaz
Labor related litigation. Challenging of procedure to fill a position.
Request dismissed. Appeal is filed.
Romgaz: creditor
SC InstaService SRL:
debtor
274,900.60 Debtor’s request is allowed. Preliminary table.
Action for annulment
Romgaz: plaintiff
Consiliul National
pentru Combaterea
Discriminarii si
Sindicatul "Extractie
Gaze si Servicii"
The scope of
is
the action
to partially allow Decision no.
371/September 2, 2015 issued by Colegiul Director al CNCD, the use
of the wording “signing syndicate” in Romgaz Collective Labor Contract
2015-2016 does not constitute a discrimination based on syndicate
membership and on access to its facilities; consequently the deletion
from Romgaz Collective Labor Contract of the above-indicated wording
is not required, the issuance of a fine to Romgaz is not grounded and
the publishing of the resolution in a nation-wide paper is not required.
Alba Court of Appeal allowed the action. CNCD filed recourse. ICCJ
did not set a trial date.
174
652/102/2016
Labour related litigation Stefan Ioan: plaintiff Romgaz: defendant
Scope of action: annulment of Decision 74/2016 regarding the
Individual Work Contract extension of suspension. Mures County Court
of Law dismissed the action. No appeal was filed.
final
28
March 23,
2017
April 4,
2017
March 15,
2017
Currently
not
established
No.
File No./ Court of
Law
175
1877/85/2016
Case
Plaintiff
Defendant
Amount
(RON)
Description
Annulment of General
Shareholders Meeting
SIF Oltenia: plaintiff Romgaz: defendant
On October 4, 2016 Sibiu County Court of Law dismissed the action.
The Decision is to be communicated. Appeal was filed by SIF Oltenia.
Appeal is to be judged by Alba Iulia Court of Appeal. Currently, no term
was established.
176
3267/117/2016
Specific performance
177
2157/215/2016/10
807/63/2016*
Public procurement
Related litigation
Todoran Lucian:
plaintiff
Sirius - Es Ro:
plaintiff
Romgaz: defendant
Cluj County Court of law dismisses the action.
Romgaz si SC Foraj
Craiova SA:
defendants
2,098,669.66 Craiova Court of Law. Declined by Dolj County Court of Law. New case
file: 10807/63/2016*.
178
1284/102/2016
Labour related litigation Sturza Ioan: plaintiff Romgaz
158,272 Discrimination.
179
249/57/2011
Labour related litigation Romgaz: plaintiff
180
1300/102/2016
Labour related litigation Tegla Nicodim
Ciprian: plaintiff
CNCD and Sturza
Ioan: defendants
Romgaz: defendant
Alba-Iulia Court of Appeal: annulment of Decision no. 603/December
09, 2015.Recourse will be filed with the Higher Court of Cassation and
Justice.
130,000 Mures County Court of Law: scope of case file is to compel Romgaz to:
- review wage-related rights starting with 2013 until now and
onwards;
- pay wage-related monetary difference starting with June 2013 until
the full payment thereof amounting RON 130,000 at the record date of
the action, for 36 months;
- pay legal interest on wage-related monetary differences starting
with June 2013 until the full payment thereof.
150,000 Ludus Court of Law: separated from file no. 1855/251/2013.
7,000 Summons, reimbursement of amount.
PFA Cormos
Daniela: plaintiff
Romgaz
Romgaz and SC
Commindal Impex
SRL: defendants
Asociatia "Creation
Transylvania"
Romgaz
Asociatia "Sf. Patrick"
1,750 Summons, reimbursement of amount.
Rocada Serv SRL
STTM Targu Mures,
SPEE Iernut, Romgaz
24,045.92 Unjust enrichment: payment of equivalent value for transportation
services.
SC Accent Service
SRL
Romgaz
14,257.22 Payment of equivalent value of car repair services for cars in Romgaz
property.
29
181
698/251/2016
claims
182
183
184
185
1311/257/2016 –
Medias Court of
Law
4887/306/2016 –
Sibiu County
Court of Law
9261/320/2016 -
Targu Mures
Court of Law
3595/279/2016 -
Piatra Neamt
Court of Law
claims
claims
claims
claims
Next
procedural
deadline
Stay of
proceedings
Stay of
proceedings
April 16,
2017
March 14,
2017
March 7,
2017
March 3,
2017
March 8,
2017
No.
186
187
188
189
190
191
192
193
194
195
196
197
198
File No./ Court of
Law
801/85/2016 -
Sibiu County
Court of Law
5158/2/2016 -
Alba Iulia Court of
Appeal
5243/257/2016 -
Medias Court of
Law
5243/257/2016
Medias Court of
Law
5217/257/2016
Medias Court of
Law
35304/3/2016 -
Bucuresti Court of
Law
341/257/2017 -
Medias Court of
Law
5243/257/2016
Medias Court of
Law
1640/85/2016 -
Sibiu County
Court of Law
11986/3/2016
2093/102/2016 -
Mures County
Court of Law
2372/102/2016 -
Mures County
Court of Law
2389/102/2016 -
Mures County
Case
Plaintiff
Defendant
Amount
(RON)
Description
granting monetary
rights
Sindicatul Liber
Medias
Public procurement
European Funds
Invest SRL
Romgaz
Romgaz
Employees’ participation to profit to the extent of 10% of the company’s
net profit. Appeal dismissed. Decision no. 1610/2016.
Complaint in relation to CNSC Decision no. 1137/June 28, 2016.
Complaint dismissed. Decision 1729/2016. Final.
Complaint of violation
Romgaz
ANRE
Complaint of violation
in
relation
to Offence Report no.
87670/December 14, 2016.
Complaint of violation
Romgaz
ANRE
Complaint of violation
in
relation
to Offence Report no.
87660/December 14, 2016.
Complaint of violation
Romgaz
ANRE
Complaint of violation
in
relation
to Offence Report no.
87105/December 12, 2016.
Insolvency
Romgaz: creditor
SC Electrocentrale
Bucuresti SA: debitor
569,945,968.48
Insolvency – table of receivables was filed. Challenge was filed.
Complaint of violation
Romgaz
ANRE
50,000 Complaint of violation
Complaint of violation
Romgaz
ANRE
50,000 Complaint of violation
Payment injunction
Romgaz
Distraint upon property Romgaz
Annulment of document Sindicatul Liber
Romgaz
SC Electrocentrale
Bucuresti SA
SC Electrocentrale
Bucuresti SA
Romgaz
187,249,423.79 Request for annulment (EGO no.119/2007). Action allowed. Final
decision no. 1328/December 09, 2016.
Alba Iulia Court of Appeal allowed the request. Civil Decision no.
1163/June 22, 2016.
On January 10, 2017 declined its competency in favour of Sibiu County
Court of Law.
Monetary rights
Employees of SPEE
Iernut
Romgaz
Reviewing wage-related monetary rights starting with May 1, 2016 until
now.
annulment of document Sindicatul Liber
Romgaz
Annulment of document.
Romgaz
30
Next
procedural
deadline
Currently
not
established
Currently
not
established
Currently
not
established
March 2,
2017
Currently
not
established
March 24,
2017
Currently
not
established
March 7,
2017
March 9,
2017
No.
File No./ Court of
Law
Court of Law
Case
Plaintiff
Defendant
Amount
(RON)
Description
Next
procedural
deadline
31
SNGN “ROMGAZ” SA Annex no. 4
ANNUAL REPORT
on social responsibility sponsorship/patronage action for 2016
Projects, actions, social responsibility initiatives in the following fields: medical, health,
medical treatment and interventions
Romgaz offers support for health specific projects, identified as a priority, especially in
communities where the company operates.
Mediaș Municipal Hospital: Financial support for continuing the Projects for modernization
and increase of energy efficiency by using solar energy for hot water and by using heat pumps
and geotechnical drilling at Internal Medicine Pavilion from Medias Municipal Hospital
In 2015 Medias Hospital, the only medical facility serving the north of Sibiu county, at the
company’s initiative, according to the 2014 validated CSR action plan and being entirely
financially supported by Romgaz, conducted the pilot project for energy efficiency of a
building, called Green Hospital. The action consisted in modernizing the Infectious Diseases
Pavilion and increasing energy efficiency by the use of energy from renewable sources using
geothermal drilling with heat pumps and solar panels. This investment has reduced production
costs of the heat by 50% for this pavilion, at the same time being a sustainable method. The
pilot project proved to be an effective one, which is why Medias Hospital has taken steps to
extend the heat production system from renewable sources at other pavilions. Currently, the
project for increasing energy performance by using renewable energy sources is in the process
of preparing documentation for approval of intervention works (D.A.L.I.) the total project
value being EUR 235,000. For the Green Hospital pilot project Romgaz contributed with
EUR 50,000 euro. Stage 2 will be conducted in 2017.
Benefits for the community: Reduction of energy costs reflected in hospital’s budget without
reducing the comfort of the patients. Environmental protection through the use of renewable
energy sources.
Târnăveni Municipal Hospital „Dr. Gheorghe Marinescu: Financial support for the purchase
of a CT scanner to equip the Laboratory of Radiology and Medical Imaging
Târnăveni Hospital serves a community of about 22,000 people, the vast majority coming
from rural areas of the Transylvanian Basin, where the company operates for over 100 years.
In the investigation and treatment process, the hospital requires specialized equipment which
is why Romgaz has met their request for funding to purchase a CT scanner to equip the
Laboratory of Radiology and Medical Imaging. The acquisition will be achieved during 2017.
Benefits for community: Cost reduction for local community
investigations by providing proximity.
to perform imaging
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Ploiești Emergency Hospital: Financial support for equipping Anaesthesia and Intensive
Care units, Medical Analysis Central Laboratory, Neurosurgery and Orthopaedics in Ploiești
Hospital with necessary medical equipment
Ploiesti Storage branch employees are members of the community served by Ploiești
Emergency Hospital, which is the only hospital that provides medical emergency services
within a radius of 60 km for approx. 250,000 urban residents and rural surrounding areas. The
acquisition will be achieved during 2017.
Benefits for community: Quality services for Ploiesti inhabitants and inhabitants from rural
surrounding areas in the emergency department of Ploiesti Hospital.
Blaj Municipal Hospital: Financial support for the purchase of specialized equipment for
Hospital Laboratory, a Biochemistry Laboratory equipment and a Doppler ultrasonograph
The hospital serves a community of about 52,000 urban and rural residents, and some of them
are members of the communities where Medias Production Branch has production fields.
Romgaz has met the hospital need giving financial support to purchase Biochemistry
Laboratory equipment and a Doppler ultrasonograph. The requested amount is additional to
own financial resources for renewing the equipment. The acquisition will be achieved during
2017.
Benefits for community: Cost reduction for local community to perform laboratory or
imaging investigations by providing proximity.
“Petru Poni” Institute of Macromolecular Chemistry, Iasi: Financial support for patenting
(WO Patent) the Project „Thermoreversible Injectable Hydrogels for Cardiac Tissue Repair
after Myocardial Infarction”
Financial support offered to “Petru Poni” Institute of Macromolecular Chemistry, Iasi for the
project "Thermoreversible Injectable Hydrogels for Cardiac Tissue Repair after Myocardial
Infarction" is an aid to encourage health research. The invention of „Petru Poni” Institute
researchers has positive results in the laboratory, but there is also required to have an
internationally patent protection. Romgaz has offered a part of the amount required to cover
these costs so that the right conditions can be provided for producing and merchandising the
gel. Hydrogel is due to come into production during 2017.
Benefits for community: Thermorevesible hydrogel is a product intended to heal myocardial
infarction by non-invasive surgery. Injecting an ml of gel in the cardiac tissue it will result in
a healthy tissue within 4 weeks. The product was tested in the laboratory having remarkable
results.
The product has a major social and economic impact, heavily reducing costs compared to
conventional surgery for heart attack and the recovery time of the patient.
In a 2011 Eurostat statistic, Romania ranks 7 out of 33 analysed countries with deceased from
cardiovascular diseases, with a total of 700 people per 100,000 residents, compared to the EU
average of 278 people per 100,000 inhabitants.
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The Association Education for Europe: Financial support for running the project "Romgaz
supports Health in Mures rural units".
The project is to be conducted in 2017 in 10 villages in Mures County, Romgaz covering a
part of the total project value of RON 69,000. The project addresses to communities or
disadvantaged social groups, providing a complete set of analysis within the perimeter of the
village as well as general check-up done by partner doctors.
Benefits for community: Access to basic medical tests for people with reduced mobility or
under-privileged people from the rural area in question.
Social responsibility projects, actions, initiatives in the fields: education, social and sport
Education and other social and/or sportive actions dedicated to the community are part of
priority directions and with high expectations of their members. Romgaz has been constantly
involved in supporting the sports community of Medias and its surroundings as sport is a
means of optimizing the health of the population and an activity that facilitates socialization
in today's society where is an increasingly trend of individuals dispersal and human isolation.
Petroleum - Gas University of Ploieşti: Financial support for running the internally and
internationally promoting project to attract students
The strategy of Romania's energy sector aims to cover the energy needs for all economic
sectors, ensuring a decent standard of living and respecting sustainable development. The
development of this sector with secular tradition requires specialized human resources with
good knowledge in the technical and scientific field. The financial support granted by
Romgaz for running programs to promote research in this area aims to attract graduates to
support energy sector development.
Petroleum - Gas University is a non-profit and non-political educational institution with a
unique profile in the country, specialized in education and scientific research of their own
and/or in collaboration with other institutions in the country and abroad.
Benefits for community: Institutional and scientific research development in the oil and gas
field for the benefit of the community, supporting the development of specialists in this field,
increasing the energy sector potential by providing qualified human resources.
Gaz Metan Medias Sport Club: Financial support for performing the activities within the
football sport club in 2016
The senior football team promoted in 2016 in the first league of the internal football
championship, placing third after 15 rounds. The children and junior centre consists of
approximately 150 players split in six groups (9-12 years) and approximately 100 children (6-
12 years) that play in local and national competitions organised by the Romanian Football
Federation, the County’s Football Association or in independent competitions such as:
Gheorghe Hagi Cup, Gheorghe Ene Cup, etc.
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Benefits for the community: Gaz Metan Medias is a well-established local sports club since
1945. The club is present in the first league through the first team, whereas the B-team, the
children and junior centre perform a prolific activity. Romgaz has constantly been involved in
supporting Gaz Metan Medias sport club activities.
“Elisabeta Polihroniade” Association Bucharest:Main sponsor of the event Romgaz Kings
Tournament (Bucharest – Medias 28.11 – 01.12.2016).
The Kings Tournament, an event of success, where Romgaz is involved together with the
Elisabeta Polihroniade Sports Club Association is among the most appreciated international
chess competitions, being acknowledged by the Romanian Chess Federation and the World
Chess Federation (FIDE). It has been included in 2010 in the Grand Slam due to the excellent
conditions offered by the organisers. The international competition has three components: the
games between chess grand masters, Chassebase online games, between Romanian children
and foreign children, and Romgaz Open, with the free participation of all professional and
unprofessional players.
Benefits for the community: making chess popular throughout the country and introducing the
optional lesson “Education through chess” in the pre-university level. The high performance
sportsman became a symbol for the society. He/she captures the attention and the interest of
masses not only through his/her results but they becomes also a role model of success. These
values may be transmitted to those that aim at being a performant sportsman and concurrently
they act as incentives for those who practice sports for pleasure.
Electromures Sport Club, Mures County: Financial support for performing the activities of
the sports club in year 2016
Romgaz granted in 2016 financial support for the nine-pin bowling team of “Electomures-
Romgaz”. The women’s nine-pins bowling champion team qualified for the autumn edition of
the continental Champions League further to ranking fifth at the XXVIII-edition of the World
Cup.
Benefits for the community: Electromures Sports Club has been established in 1971, Romgaz
supported the club where some of its employees play.
“Romgaz Table Tennis Sport Club” Medias: Financial support for performing the activities
of the sports club in year 2016
Romgaz has granted financial support for performing the club’s activities since 1999, the
establishment year. Initially it has been the sole sponsor, but today the club receives
sponsorships also from other community members.
Results: first place – children team, second place – the mini cadet team and third place – the
junior team. Cristina Dumitrescu and Diana Muntean are national double champions, cadets.
BEATRICE Hila ranked first at the national championship, children 8-10 years, ad
participated at the European Championship Mini-Cadets.
Andreea Dragoman is member of the national women junior team, champion in Romania,
won at the ITTF World Junior Circuit in India the gold medal at senior mixt and also the
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bronze medal, at the European table Tennis Championships Andreea won the gold medal for
cadets and juniors, in Zagreb 2016. Her best result of 2016 was at the World Championship
Juniors in Cape Town, South Africa, first place double with Adina Diaconu.
Benefits for the community: Their results capture the attention and the interest of masses not
only through the achievements but also through the exponential model of the success. These
values may be transmitted to those that aim at being a performant sportsman and concurrently
they act as incentives for those who practice sports for pleasure. Andreea Dragoman, member
of the club and national champion, is frequently mentioned in the local community as a model
of a performant sportsman.
“Pro As” Sports Club, Sibiu: Financial support for organising the international tennis
tournament “Futures FRT-14 Circuit”
Romgaz granted financial support to the association in order to organise the XIIIth edition of
the international tennis tournament “Futures FRT-14 Circuit” at Medias in 12-19 August,
2016.
Benefits for the community: promoting tennis and enabling tennis players from Medias to
take part in an international tournament. Playing sports improves population’s health and
facilitates socialisation in current societies that tend to become more and more isolated. The
high performance sportsman became a symbol for the society. He/she captures the attention
and the interest of masses not only through his/her results but he becomes also a role model of
success. These values may be transmitted to those that aim at being a performant sportsman
and concurrently they act as incentives for those who practice sports for pleasure.
Macondo Cultural Association, Bucharest: Financial support
educational project CinEd – European Education for Youth
for
implementing
the
Romgaz has granted financial support for
the educational
cinematographic project for pupils and teachers CinEd – European Education for Youth; the
extended project for cinematographic education for European students (Bucharest,
Alexandria, Buzau, Galați, Craiova, Mediaș, Târgu Mureș, Timișoara, Ploiești and Roman, 18
April – 14 May 2016).
implementation of
the
Benefits for the community: the teachers have received free accounts on the platform to
access the educational resources and the movie list and therefore a large number of Romanian
pupils could develop a new perspective on how to watch and understand art movies, by
becoming active spectators with critical inputs.
The Association for Promoting the Romanian Film: Financial support for the project TIFF
Film Caravan (July – September 2016)
A project with tradition, initiated to make up for the lack of theatre halls, the Caravan carries
on successfully for the 8th year. From July to September, on an open-air giant inflatable
screen, the viewers had the opportunity to enjoy stories granted awards at festivals, and box-
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office hits from Romania, Hungary, France, Germany, Norway, Spain, Great Britain, USA,
Canada or Brazil.
Towns included: Carei, Baia Mare, Satu Mare, Arad, Timișoara, Alexandria, Oradea, Sfantu
Gheorghe, Fagaras, Iasi, Galati, Constanta, Targoviste, Brasov, Piatra Neamt, Falticeni,
Medias and Suceava.
Benefits for the community: access of community members to cultural events
Social responsibility projects, actions, initiatives in other fields: cultural, cults
Romgaz involvement in projects or programs for the community’s interest is driven by the
desire to meet the expectations of the society and to support multilateral initiatives that can
contribute to the sustainable development in the benefit of the present and future generations.
Moreover, Romgaz supports also cultural projects.
National Romanian Committee of the World Energy Council, Bucharest: Financial support
for organising the “Regional Energy Forum for Central and Eastern Europe - FOREN
2016”.
Organized every two years by the Romanian National Committee under the auspices of the
Government of Romania, under the leadership of the World Energy Council (WEC) and with
the support of WEC Member Committees in Central and Eastern Europe, FOREN is already
being recognized as the most important multi-energy event in Central and Eastern Europe,
gathering more than 1000 participants. Besides WEC/ RNC members, the Forum attracts top
officials from ministers, governments, academia, energy leaders from European international
companies, experts in energy and environment issues, and representatives of mass-media.
Benefits for the community: possibility to address main challenges for the energy industry in
order to contribute to its sustainable development; access to events that represent the meeting
ground of energy professionals.
Romanian Youth National Art Centre (Centrul National de Arta Tinerimea Romana)
Main partner of the Magic Winter Concert (10 December Romanian Athenaeum-Bucharest)
Romanian Youth Orchestra conducted by Cristian Mandeal delighted the audience who
participated in the Magic Winter concert, an event organized by Lato Communication in
partnership with the Romanian Youth National Art Centre and Romgaz.
Benefits for the community: Access of the community members to cultural events.
Astra Film Foundation, Sibiu: Main sponsor of Astra Film Festival event (Sibiu 17-23
October 2016)
In 2014, Romgaz became the official partner of Astra Film Festival, who developed during
the over twenty years of existence a cultural brand acknowledged in the country and abroad
by the good quality of the films, the multitude of programs presented and the variety of
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professional workshops. The Festival is considered the most important forum for the
documentary film in Romania.
Benefits for the community: Access of the community members to cultural events, developing
country brand.
Sibiu Jazz Festival Foundation:Main partner of Sibiu Jazz Festival Project (Sibiu 23-29 May
2016)
The most known jazz festival in Romania, Sibiu Jazz Festival is unique in Romania
considering the longevity, consistency and impressive number of celebrities of the genre,
which attended the event. It is the oldest festival of its kind in the country and one of the
oldest jazz festivals in the world, which is why Sibiu was declared since the 80s, “Jazz
Capital” in Romania. Worldwide, there are rare similar festivals which can boast a history of
over four decades, when the very existence of this music hardly exceeds a century. The
declared scope of Sibiu Jazz Festival is to constantly and continuously contribute to the
revitalization of jazz movement in Romania, in the spirit of jazz tradition from Sibiu, by
connecting to the European and international tendencies of jazz music and promoting the
Romanian values abroad, thus becoming a cultural vector for Sibiu citadel and for the
Romanian jazz world as well.
Benefits for the community: Access of the community members to cultural events, developing
country brand
Euro Fest Association, Bucharest: Main partner of Medias Central European Film Festival
(September 1 – 3, 2016 Medias)
Romgaz directly supported Medias Central European Film Festival (MECEFF meceff.ro), a
cultural event that re-joined the famous names of the European cinema, being equally a
cultural and multi-ethnic project.
The project MECEFF- MEDIAS CENTRAL EUROPEAN FILM FESTIVAL “7+1”
(MECEFF “7+1”) is a - known festival for the neighbouring countries’ cinemas through
which cinemas make themselves known and the Romanian new film is introduced in a special
context, both thematically and geographical proximity, that of great tradition cinemas giving
film producers of an indisputable prestige such as Milos Forman, Jiri Menzel, Jaromil Jires,
Andrzej Wajda, Jerzy Kawalerowicz, Andrei Munk, Istvan Szabo etc.
Benefits for the community: Access of the community members to cultural events, developing
country brand
Medias Townhall: Financial support for modernization/rehabilitation works at educational
units (SNG Technological High School, St. L Roth Theoretical High School) and medical
units (Medias Policlinic and Medias Municipality Hospital)
Romgaz supported some projects initiated by Medias town hall in order to perform
modernization and rehabilitation works at some educational units in town, such as the
Technological High school SNG and Theoretical High school St L. Roth, but also at medical
units, such as Medias Policlinic and Medias Municipality Hospital. Both educational units and
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medical units serve the city of Medias where the company has its headquarter. The activities
shall be performed during 2017.
Benefits for the community: Through these activities, Romgaz continued to support the
development of local community both by improving the educational conditions in both high
schools where the children from the town and surroundings study and ensuring the proximity
to benefit by quality medical services.
Municipality Direction for Culture, Sport, Tourism and Young People, Medias: Financial
support for organizing various cultural events in Medias
Romgaz supported some projects initiated by the Municipality Direction for Culture, Sport,
Tourism and Young People, Medias such as: organizing the traditional Christmas carols
show, organizing events celebrating 750 years of documentary certification of Medias
Municipality, performing some fit up works at Sports Hall where a serious of cultural and
sportive events shall take place in the future.
Benefits for the community: communication platform and local civic involvement and
developing the identity of the local community and respect for the cultural legacy.
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