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Introduction & Market Context
Romanian natural gas producer Societatea Nationala de Gaze Naturale ROMGAZ SA (BVB:SNG) released its H1/Q2 2025 investor presentation on August 14, highlighting strong second-quarter performance and progress on strategic projects. The company, which is 70% owned by the Romanian state, maintains its position as the country’s largest gas producer with a 53% market share in domestic production.
ROMGAZ continues to play a crucial role in Romania’s energy security, providing over 47% of domestic gas consumption in H1 2025 and controlling more than 90% of underground storage facilities. The company’s presentation comes as Romania has emerged as the top natural gas producer in the European Union in 2024, enhancing ROMGAZ’s strategic importance in the region.
Quarterly Performance Highlights
ROMGAZ reported a significant improvement in Q2 2025 performance compared to the same period last year, with net profit jumping 23% year-over-year to RON 728 million ($145.6 million). This strong quarterly performance was driven by a 15% increase in revenues to RON 1,868 million and a 30% surge in EBITDA to RON 999 million, resulting in a robust EBITDA margin of 53.5%.
The company’s performance for the first half of 2025 showed mixed results, with revenues increasing by 9% year-over-year to RON 4,248 million, while net profit declined by 9% to RON 1,679 million. EBITDA for H1 2025 decreased slightly by 2% to RON 2,308 million, maintaining a strong EBITDA margin of 54.3%.
As shown in the following financial performance highlights chart:
Gas production remained relatively stable at 2.49 billion cubic meters (bcm) in H1 2025, with a slight increase of 0.4% year-over-year in Q2 alone. The company’s average daily production was 13.7 million cubic meters, with three new wells contributing 9.1 million cubic meters to production in 2025. ROMGAZ also conducted workovers on 105 wells in H1, with 85 wells successfully restarted.
The following chart illustrates the company’s natural gas production trends:
Strategic Initiatives
The Neptun Deep project in the Black Sea represents ROMGAZ’s most significant growth opportunity and accounts for the largest portion of the company’s capital expenditures. ROMGAZ holds a 50% stake in this major offshore development through its subsidiary ROMGAZ BLACK SEA LIMITED, with OMV Petrom owning the remaining 50%.
The project, which represents an investment of up to EUR 4 billion, is progressing according to schedule with drilling currently underway in the Pelican South field. First gas production is expected in 2027, with production at plateau estimated at approximately 8 bcm annually, which would make it the largest natural gas project in the Romanian area of the Black Sea.
As illustrated in the following project overview:
Capital expenditures for H1 2025 totaled RON 1.89 billion, with 73% allocated to the Neptun Deep project. The remainder was primarily directed toward exploration (11%) and other investments in production, storage, and electricity generation.
The capital expenditure breakdown is shown in the following chart:
Another key strategic initiative is the new Iernut Power Plant, which is nearing completion with approximately 98% of construction finished as of end-July 2025. This state-of-the-art facility will have a capacity of 430 MW and represents an important step in ROMGAZ’s diversification into electricity production.
Competitive Industry Position
ROMGAZ maintains a dominant position in Romania’s natural gas market, with its business segments spanning gas exploration, production and supply, underground gas storage, and electricity production. The gas exploration, production, and supply segment generated 89% of revenues and over 100% of EBITDA in H1 2025.
The company’s business segment breakdown is illustrated here:
In terms of gas sales, ROMGAZ reported a 12.6% increase in volumes sold and a 9.4% rise in gas revenues for H1 2025. The company’s client portfolio is well-diversified, with Romania’s two top gas suppliers (E.ON and ENGIE) accounting for 43% of volumes sold, large producers of thermal/electrical energy representing 40%, and other clients making up the remaining 17%.
The following chart shows the gas supply and sales performance:
ROMGAZ also dominates the underground gas storage business with a 91% market share, operating five underground storage facilities with a total capacity of 2.87 bcm. This segment contributed 6% of revenues and 5% of EBITDA in H1 2025.
Forward-Looking Statements
ROMGAZ outlined its growth strategy around three main pillars: further developing its existing portfolio, strengthening market share through diversification, and expanding its commercial presence. The company aims to achieve a reserve replacement ratio of over 50% annually for its onshore operations while adding 10 production wells in Neptun Deep.
The growth strategy is summarized in this overview:
On the ESG front, ROMGAZ has committed to a minimum 10% reduction of carbon, methane, and other gas emissions by 2030 compared to 2020 levels, with a longer-term path toward net-zero emissions by 2050. The company is also implementing renewable energy production projects with a planned total capacity of 180 MW by 2030.
The company’s ESG strategy is outlined here:
ROMGAZ also highlighted several important recent events, including the conclusion of a new two-year market making contract to improve shares trading liquidity in August 2025, the publication of its first ESG report on April 30, 2025, and the successful completion of a EUR 500 million bond issue with investor demand ten times higher at EUR 5 billion. The company is planning another bond issue, although Fitch Ratings has revised ROMGAZ’s outlook from "Stable" to "Negative."
With its strong market position, robust profitability margins, and strategic investments in major projects like Neptun Deep, ROMGAZ appears well-positioned to maintain its role as a key energy security provider in Romania and the broader Central and Eastern European region, despite operating in a highly regulated environment with price caps and special taxes.
Full presentation:
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