Sterling Deems All Charges Against It Are False, Romanian State Is Sole Culpable

Publish date: 29-04-2009
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The vice-president of Canada's Sterling Resources, Stephen Birrell, said Tuesday that all the accusations against Sterling are false, and the Romanian state is the only culpable by self-annulling the right to benefit from a share of the oil production in the Black Sea.

"Sterling has never been officially notified on having breached the law. All the charges are false. We were accused of having changed the terms of the deal, from the exploration and production distribution into exploitation and payment of some dues. We have been having the exploitation right since the beginning, through the deal initially signed in 1992. We were also accused that through additional act 11 from 2007, the state lost the right to take part in the production sharing, but the state self-annulled this right, not Sterling, through the Oil Law, which introduced dues instead of production sharing," Birrell said.
Birrell was heard Tuesday by the deputies with the Commission for Industries and Services within Romania's Chamber of Deputies, on the deal between Sterling and the Romanian state.
The deal targeted the oil exploration and exploitation of two perimeters in the Black Sea.
Birrell equally answered all charges brought against the company he represents.
"We were accused of not proving our technical and financial creditworthiness. We have been operating on the Romanian market since 1993, and this had not happened without the government approving our technical and financial capability. We have all the necessary authorizations and licenses. The National Agency for Mineral Resources (ANRM) has never asked for any certificate or proof of our creditworthiness," Birrell also said.
ANRM president Gelu Maracineanu previously accused Sterling that it has never officially proved its financial and technical creditworthiness to develop oil operations in the Black Sea and it does not have the necessary authorizations to develop the oil operations in Romania.
"Several checkups took place at Sterling, the last one in April 2009, but nobody told us we lack the necessary permits or we breached the Romanian or European legislation," according to Birrell.
Birrell said he is affected by the false statements on the contract between Sterling and ANRM and hopes the Commission's probe develops based on facts and not on charges.
Based on the initial deal, Sterling was entitled to exploration and exploitation rights as well as various incentives, such as the exemption from paying taxes and dues. These were all negotiated with the Romanian Government and further mirrored in the 45% quota from the oil production the state was entitled to.
The production distribution mechanism has not been enforced with the Romanian state since 1995, namely since the Oil Law enactment which introduced the dues payment.
Birell also said that in 2001, the Government confirmed in a letter the exemption from taxes and dues of the companies subject to with leases in Romania.


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