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Transgaz and Black Sea Oil & Gas sign the order to start the works to take over the MGD Project gas production into the NTS

Bucharest Romania, 2 September 2019

Corbu, Constanta county, 30 August 2019: Transgaz S.A. (“Transgaz”) CEO, Mr. Ion Sterian, and Black Sea Oil & Gas S.R.L. (“BSOG”) CEO, Mr. Mark Beacom, signed today in Corbu the order to start the works of the two projects to take over the Midia Gas Development Project (“MGD Project”) production into the National Transmission System (“NTS”).

The event was attended by the Minister of Economy, Mr. Niculae Badalau and the head of the Chancellery of the Prime Minister, Mr. Costin Mihalache, who presented the message of the Prime Minister of Romania, Mrs. Viorica Dăncilă.

Transgaz’s project “NTS extension Vadu – T1” consists of building a new 20″ (Dn 500) gas pipeline designed to carry natural gas at a pressure of 55 bar, with a total length of approximately 24.37 km that will connect the Black Sea coast with the National Gas Transmission System – Transit 1 pipeline on the route Black Sea coast – Corbu – Sacele – Cogealac – Gradina. The construction works are expected to be completed in 2021.

The MGD Project consists of 5 production wells (1 subsea well at Doina field and 4 platform wells at Ana field) a subsea gas production system over the Doina well which will be connected through an 18 km pipeline with a new unmanned production platform located over Ana field. A 126 km gas pipeline will link the Ana platform to the shore and to a new GTP. The processed gas will be delivered into the NTS at the gas metering station to be found within the GTP. The production is estimated to start in Q1 2021.

“We are witnessing today a very important moment for the Romanian economy. We start together two projects, the Midia Gas Development Project of Black Sea Oil & Gas and the expansion of the National Gas Transmission System of Transgaz, that will bring benefits for Romanians and the economy through the major contribution to the exploitation of natural gas in the Black Sea. The expansion of the National Gas Transmission System is one of the most important work performed by Transgaz and represents the starting point for the entry of the Black Sea gas into the Romanian economy and on the international market. I congratulate Transgaz and the Ministry of Economy for the sustained activity they carried out in order to develop Romania’s energy infrastructure. I wish Black Sea Oil & Gas success in this project, I encourage them to consolidate and diversify their investments in the oil and petrochemical industry in Romania and I assure them of the full support of the Government for the development of projects with benefits for both Romanians and the Romanian economy”, declared Prime Minister Viorica Dancila.

Minister of Economy, Niculae Badalau added that: “This project will cover 10% of Romania’s gas per annum and, more than that, it represents an important contribution at national level, as well as for the economic and social development of the local communities. It is the result of an investment that has so far amounted 200 million US dollars and further 400 million will be spent by BSOG until completion of the construction and which demonstrates our commitment to continue supporting the business environment in Romania.”

“Transgaz respects its mission to function as a national and regional energy security provider, through the investments of strategic importance that it carries out both in Romania and in the Republic of Moldova, where we are building the Ungheni-Chisinau gas pipeline. At the same time, Transgaz through the development of the National Gas Transmission System, makes its substantial contribution to the economic and social development of Romania. We achieve these very important objectives through the expansion of the NTS, which will allow all local communities to be connected to the gas network, but also through strategic projects, such as BRUA, which will bring significant economic and social benefits for Romania, allowing the potential of our country to be reached. We can state with responsibility that energy represents the resource of the present and the future, and the energy infrastructure is a sustainable vector through which this resource is transformed into clear opportunities. Transgaz remains a serious partner for all investors interested in economic development” said Mr. Ion Sterian, General Manager of SNTGN Transgaz, on the occasion of signing the order to start the works.

Commenting on the event, Mr. Mark Beacom said: “We are very pleased to have reached another milestone in this pioneering offshore project that we have been working on alongside our partner Transgaz over the past three years. We thank Mr. Sterian and his team for their proactive and professional approach in reaching this stage.”

About Transgaz

“TRANSGAZ” S.A. is the technical operator of the Romanian gas transmission system and it is responsible for its operation under quality, safety, efficiency and environmental conditions. Transgaz has been established based on Governmental Decision no. 334/28 April 2000 and is the Romanian legal person operating as a trading joint-stock company, under the Romanian legislation and its By-laws.

About BSOG

BSOG, owned by Carlyle International Energy Partners and the European Bank for Reconstruction and Development, is a Romanian based independent oil and gas company, targeting exploration and development of conventional oil & gas resources. The company’s current portfolio is made up of XV Midia Block and XIII Pelican Block, the shallow waters area, concession in the Romanian Black Sea where it is the operator and holds a 70% interest.