After almost 12 years of odes to the private small and medium-sized enterprises and their beneficial role in the economy, the Romanian State proves once again that the nostalgia for industrial giants is far from over. In "the year of the SNP Petrom privatisation," the Industry Ministry seems determined to create a petrochemical colossus, instead on focusing on the oil company's sale.
After all, since a state-owned SNP (National Petroleum Company) was successful, why shouldn't we get another one - the National Petrochemical Company (SNP)?
The Industry and Resources minister Dan Ioan Popescu yesterday said he was planning to create a company comprising the petrochemical divisions of Arpechim Pitesti (one of Petrom's refineries), Petromidia Navodari (belonging to private group Rompetrol) and Oltchim RAâsmnicu-VAâslcea.
The minister made the announcement one week after the resignation of Ioan Popa, general manager of Petrom. The oil group's privatisation is in full swing, and Arpechim is an important component of Petrom.
The new petrochemical mammoth may post more than 700 million dollars in turnover and will need investments worth several hundred million dollars, according to the minister. It is not clear yet where the investments will come from, since Oltchim alone has debts in excess of 300 million dollars. Moreover, it is not clear whether Rompetrol (Petromidia shareholder) will participate in the new company with the necessary assets or a big part of Petromidia assets will find their way back to state ownership.
Another big unknown is the impact of these plans on the privatisation of Petrom, since the sale process has already been launched.
The idea of a joint strategy for the oil and petrochemical industries has been disclosed ever since last year, after the failed attempt at privatising Oltchim.
The plant, which posts $350m annual turnover, relies solely on the Arpechim refinery for the ethylene and propylene supplies. Under the circumstances, Oltchim managers have repeatedly said the company's sale will be difficult since Petrom is also preparing for privatisation and the source of raw materials is no longer certain.
Dan Ioan Popescu yesterday told Mediafax that the merging project encompassing Arpechim, Oltchim and Petromidia sprang from the need to bring this industry back to life. More investments could also be attracted this way, the minister said.
Rompetrol Group CEO Dinu Patriciu told Mediafax he approved of including Petromidia's petrochemical operations in a complex comprising Oltchim and Arpechim.
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