BR Interview | Nicolae Bănică, CEO OSCAR Downstream: Romania is one of the few European countries that may achieve energy independence

In a recent Business Review exclusive interview, Nicolae Bănică, CEO of OSCAR Downstream, offers unique insights into the evolving landscape of the Oil & Gas industry. From the resurgence of demand post-pandemic to the accelerating green transition, Bănică navigates the complexities of an industry poised at the intersection of tradition and innovation. With a keen eye on Romania’s energy future and OSCAR Downstream’s strategic positioning within it, Bănică shares his perspectives on the trajectory of production, consumption, and investment, illuminating a path forward amidst dynamic change.

How has Oil & Gas production and consumption developed in recent years and when should we see a decline?

After the sharp declines during the pandemic years, economic activities have picked up and this gave a new impulse to Oil & Gas demand, which now stands at record levels globally.

The industry remains strong and will remain so for years to come, even though the war in Ukraine has accelerated the green transition, especially in Europe.

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How do you think production and consumption will evolve in the medium and long term?

As the green transition advances all over the globe, conventional fuels production and consumption will decrease accordingly. However, oil is a resource we will continue to use for at least several more decades, even if the downward trend in consumption continues.

While Romania remains one of the top European crude oil producers, a considerable part of local consumption is covered by imports. According to the National Prognosis Commission, this year’s production is estimated at 2.98 million tons of oil equivalent, while imports at 9.65 million tons.

The Commission also expects Romania’s oil production to steadily decrease by 2026 at an annual rate of 2.2%, while imports will increase by 4.1% per year.

This trend is reflected in our business volume at OSCAR Downstream, in recent years. We expect this market dynamic to continue, as major private and public investment plans are put into motion.

In terms of gas consumption, Romania is predicted to double its needs over the following years, in view of the considerable pipeline of large energy investment projects (gas power plants), increasing industrial needs and the expansion of distribution networks.

What investments are needed in this sector?

Romania has a balanced mix of energy resources and is one of the few European countries that may achieve energy independence, while also playing a major strategic role in the region.

It needs, however, to strengthen its energy infrastructure and design an integrated, efficient, and competitive national platform that complements the benefits and strengths of both conventional and renewable resources.

We’ve seen an accelerated development of renewable energy projects in recent years. Such trend – and this is a global reality – has shifted attention from the Oil & Gas industry, with several experts warning that this investment gap could trigger a boomerang effect on consumers.

I believe that every company, conventional or renewable players alike, should be committed to the joint effort for a sustainable, responsible future, however transition must be smooth and risk-free for consumers and the economy overall.

We are constantly following up on trends and new technologies that change the face of our industry in more mature markets, hoping that OSCAR will be the pioneer that brings those new technologies in Romania, once the market conditions are right.

Over the past years, we have invested more than EUR 50 million to develop the largest in-house, fully-integrated logistics chain in the industry (a +110 unit gas station network strategically distributed nationwide, over 2,500 OSCAR – DIESELPoint in-house fueling stations, the largest in-house tanker fleet in Romania with more than 100 modern tankers, and 7 environmental-friendly OSCAR warehouses located at a distance of at least 200 km from each other).

From the moment that fuel enters OSCAR Downstream’s ecosystem, until final delivery to clients, the distribution flow is completely controlled by the company. Thus, it ensures the same quality of products and services that clients have been used to since the very beginning.

Separately, we continue our investment in automation and digitalization, so that to streamline our operations and client interactions, while reducing our carbon footprint.

At Group level, we are actively pursuing opportunities for investments in renewable energy (starting with solar panels installed in our facilities). Also, we are considering the installation of recharging stations for electric cars around the OSCAR network.