Gazprom loses its monopoly, production and export sales are falling

Gazprom has lost its monopoly for the gas exports. A part of the Russian gas to Germany will be shipped not by the largest gas holding Gazprom but Novatek.

Though Gazprom was has lost part of the  German market its not that much, nevertheless it has happened, and beginning with Q4 2 bln cubic meters of gas will be annually shipped to Germany by Novatek. The contract is signed for 10 years. The value  of the contract is assessed at around $600 mln a year and could be up to $10 bln for 10 years.

The contract for the supply of the Russian gas to Germany has been signed between Novatek Gas & Power (the European affiliate of Novatek) and EnBW (Germany). According to Interfax, Novatek confirms this information on the signing of the contract for the gas supply to Germany at the volume of 2 bln cubic meters a year ($300 per thousand cubic meters). The gas supply by this contract will start in Q4 2012.

Last year Gazprom supplied about 34 bln cubic meters of natural gas to Germany and 2 bln cubic meters which will be shipped by Novatek makes up 6% of Gazprom’s volume.

Last month it was reported that the Russian gas will be shipped to Germany not only by Gazprom. EnBW didn’t deny it had signed a 10-year contract for the total amount of $6 bln though didn’t release its new supplier. Analysts thought at once it would be the company of L. Mikhelson.

Last year the European mass media reported that EnBW would sell ¼ of its shares to Novatek but officially this information wasn’t confirmed.

EnBW realizes gas, produces energy at the gas electric stations, holds gas storage facilities. Last year EnBW increased the physical volumes of sales by 7.1% having raised the revenue from the gas sales by 1.7%.

Meanwhile Gazprom’s position in H1 2012 has been significantly shaken. The gas exports to the European countries within that period fell 17% to 71 bln 930 mln cubic meters (in H1 2011 86 bln 600 mln cubic meters were exported).

The natural gas exports by Gazprom to Germany in H1 2012 made up 17 bln 130 mln cubic meters, to Turkey – 14 bln cubic meters, Italy – 6 bln 620 mln cubic meters, Poland – 5 bln 030 mln cubic meters.

The gas exports by Gazprom in H1 2012 made up 104 bln 400 mln cubic meters.

Earlier announcing the exports plans for 2012 A. Miller, the head of the holding, said that Gazprom will supply 150 bln cubic meters of gas to the European countries.

Within the last few years the partners of Gazprom due to the changes in the world gas market are aiming for the reconsideration of the  gas contracts signed earlier trying to lower the price. Last year Gazprom had to reconsider the agreements with a few companies at once, among which were Sinergie Italiane, Edisson, «PremiumGas», GDF Suez, Wingas, Wintershall Erdgas Handelshaus, SPP. This year Gazprom agreed to reconsider the contracts with GWH Gashandel, E.On Ruhrgas, ENI and Econgas.

The natural gas production of Gazprom fell in H1 by 5.9%. I H1 2012 Gazprom produced 252 bln 761 mln cubic meter of gas.

It was also reported of the significant fall of Gazprom’s net profit in Q2 2012. The net profit fell 52% making up 500 mln roubles.

http://www.profi-forex.org/news/entry1008134696.html

Translated by Galiya Musabekova