Strategic Managment at Petrom Company

Topics: Natural gas, Renewable energy, Strategic management Pages: 13 (3496 words) Published: March 29, 2011





The purpose of this paper is to present an overall view of the strategic and operational management of the Romanian company, Petrom S.A. Our purpose is to analyze the mission and vision of the company, how the strategy is implemented, if are there any barriers and in the same time the external environment or what competitive advantage has the company. The research for this paper was conducted through a detailed information gathering concerning the company’s activity. We were also provided with various documents and presentation brochures of the company, in order to get familiarized with it.

Petrom is the largest oil and gas producer in South Eastern Europe. With activities in the business segments of Exploration and Production, Refining, Marketing as well as Gas, Petrom has proved oil and gas reserves of 823 mn boe, a maximum refining capacity of 8 million tons per year, approximately 550 filling stations in Romania and over 260 filling stations in Moldova, Bulgaria and Serbia.

1. General description of the company
Short history
After in 1991 Petroleum Petrom SA Autonomous was established, the Romanian Oil Company was established as a joint stock company, formed by the reorganization RAFIROM, PECO and PETROTRANS, which were merged and have stopped working. Romanian Oil Company owned all the ten refineries in Romania, with extraction fields, warehouses and petrol stations(1996). In 1997 the Romanian Oil Company, which owned all ten refineries in Romania, with extraction fields, warehouses and petrol stations, was divided between the eight refineries functioning on their own, the rest falling assets owned National Company Petroleum (SNP) Board. In 1999 it achieved the first stage of organizational restructuring by releasing a number of 13,000 people in up-stream sector. At the same time it launched the first phase of privatization of the company through a capital action. In 2002 mechanical-energy activities within the branch Petromar Constanta branch outsourced to PETROSERV, they are taken up by SC Petrom Service SA, together with all related personnel. The privatization process begins by publishing in the international press and Romania announced the selection of the consultant. 12 investment banks submitted expressions of interest are selected in July. Signing the agreement with EBRD for $ 150 million syndicated loan representing a pre-privatization. They initiate the first phase of the privatization process. In 2004, employees are submitting offers. OMV, Occidental and MOL are selected for negotiations. On 23 July 2004, OMV acquired 51% stake in Petrom. The transaction was completed in In 2006 a package of 99.9% is acquisitioned, OMV Romania, OMV Bulgaria and OMV Serbia and has 30 gas stations and 95% of MOL Aviation Petroleum. Petrom acquired a 74.9% stake in Ring Oil Holding & Trading Ltd., a company that holds a portfolio of eight exploration licenses and one exploration and production license in Russia. In 2008 Petrom has signed a contract to build a power plant in Brazi along with General Electric and Metka. The consortium will be build and deliver by September 2011, having a plant for producing electricity and steam combined cycle, which will run on natural gas. In 2009, Petrom has started production of crude oil from western Kazakhstan Komsomolskoe field.

2. Vision, mission and corporate values
Each organization must have a well defined purpose within its social and economic environment. It must define its mission and vision based on understanding the relationship it has with its customers, suppliers, partners and other interested parties; on its characteristics and own competencies. Moreover, the organization must establish strategic objectives for development taking into consideration its current and future capabilities, as well as the risks and...
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