Romanian Fiscal Authorities Impound Rompetrol Rafinare Assets Over Debt

Fiscal authorities impounded plots of land, installations and stock in the refinery's divisions. The company said the impound targets to prevent it from selling the respective assets.

"Rompetrol has no plans to sell these assets: in 2007-2010, Rompetrol Group's investment plans amount to over $1 billon, from funds of $1.8 billion granted in the same period by the majority holder, KazMunayGas," the company said in its statement, adding the impound of its assets does not affect the refinery's operations, but affect its image.

Rompetrol said the fiscal authorities' decision "ignores legal and contractual provisions whose terms are very clear." The company said ANAF has impounded its assets for "a sum of money that Rompetrol Rafinare does not owe and will never owe to the state budget, contrary to what ANAF claims."

The Rompetrol Group, owned by Kazakh KazMunayGas, must repay Romanian authorities a historic debt of 2.4 billion lei (EUR1=RON4.2723) in the account of Petromidia refinery's debt to the state budget, which was converted into seven-year bonds by government decision in 2003.

Rompetrol Rafinare has over 4,000 employees.

Rompetrol also said in its statement it will address the International Center for Settlement of Investment Disputes (ICSID), an institution of the World Bank Group based in Washington, D.C..

Rompetrol Rafinare has summoned its shareholders for September 30 to decide on converting into shares the bonds unredeemed from the state and on increasing the refinery's capital with these shares.

Rompetrol Rafinare's capital may be increased with the lei equivalent of maximum EUR517 million, respectively the value of all the bonds issued by Rompetrol Rafinare in 2003.

The Romanian Government revealed at the beginning of the year it expected to collect EUR570 million from Rompetrol.

So far, the company paid less than 10% of the EUR570 million loan falling due at the end of September, while the rest of the sum might be converted into shares, to settle the rest of the debt.

The Rompetrol Group owns almost 99% in Rompetrol Rafinare.

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