Romania’s largest driller files for bankruptcy following Chevron’s departure

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Dafora Medias, the largest onshore drilling company in Romania, has decided to file for insolvency – a move that is widely reported to have been caused by the departure of Chevron from Romania and by OMV Petrom’s decision to reduce its onshore drilling operations. OMV Petrom and Chevron were two of Dafora’s biggest clients, alongside gas producer Romgaz.

Chevron did not give reasons for its decision to cease exploration in Romania, back in Ferbruary 2015, although it might have had something to do with the statement made by Romanian Prime Minister Victor Ponta in November last year when he announced that despite initial estimates by the Energy Information Agency, Romania has no shale gas to speak of. The EIA put the country’s technically recoverable shale gas resources at 51 trillion cubic feet (Tcf)

“It looks like we don’t have shale gas, we fought very hard for something that we do not have,” Ponta told television channel Antena 3. “I cannot tell you more than this but I don’t think we fought for something that existed.”

Romania issued a memorandum on shale gas exploration in 2010 which was subsequently lifted in March 2013. However there seems to be little support for fracking among the Romanian people, with anti-fracking protests staged several times in the past, both in the capital Bucharest and on the Cheveron drilling sites.

According to the portal Romania-Insider, Dafora Medias, which is controlled by Romanian businessman Gheorghe Calburean, had EUR 45 million in revenues, in 2014, 27% higher than in the previous year.

The company has managed to considerably reduce its losses, from EUR 35 million in 2013 to EUR 0.43 million in 2014 but its total debt for the last year remained at EUR 78 million, which was 1.3 times the value of its assets.

The company, which is listed on the Bucharest Stock Exchange and is currently valued at some EUR 3.5 million, could not come to an agreement with the state to postpone paying its fiscal debt, which amounted to some EUR 2.7 million, causing it to file for bankruptcy.

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