OMV sues Romania at ICC for breaching privatization contract

Austrian company OMV, the major shareholder of Petrom, sued the Romanian state in March 2017, at the International Court of Arbitration (an institution that is part of the International Chamber of Commerce - e.n.) in Paris, for breaching the provisions of the privatization contract regarding the recovery of environment investments, the oil company's report for 2016 reveals.

According to the privatization contract, the Romanian state committed to pay to OMV the amounts that this company would have invested in environmental works related to historical pollution, amounts that were estimated at 542 million euros.

"In April 2016, OMV sent to the Romanian state a litigation notification in regards to certain unpaid requests by the Romanian stated for decontaminating some wells and rehabilitating the environment, worth 34 million euros," the OMV report points out.

Since the notification was sent, the Romanian state and OMV had at their disposal 180 days to amicable resolve this conflict.

"This deadline expired on 19 October 016 and on 7 March 2017, OMV started the arbitration procedures against the Romanian state, according to the International Chamber of Commerce (ICC) regulations," representatives of the Austrian company stated in the document.

Through the Petrom privatization law, the Romanian stated committed that, for a period of 15 years since the completion of the privatization process, namely starting from 14 December 2004, will totally compensate the company for any claim regarding the environment's historic contamination, according to the terms and conditions stipulated in the compensation commitment regarding the environment.

Furthermore, for 30 years since the completion, the Romanian state should have totally compensated the company for any claims in respect to the abandonment or decommissioning the wells that were abandoned, stopped, closed or waiting to be abandoned, at the date of signing or completing, giving the case, in accordance with the terms and conditions stipulated in the compensation commitment regarding the environment.