GAZPROM'S $11 BLN
FT - Gazprom will reveal a financing package for the $11bn gas pipeline to Germany by the end of this month as the Russian energy company seeks to draw a line under the cost of a series of political battles with European regulators.
The group was forced in August to abandon plans to split the cost of the 1,200km Nord Stream 2 pipeline under the Baltic Sea with the project's European partners Engie, OMV, Wintershall, Shell and Uniper after Polish competition regulators objected.
Alexander Medvedev, Gazprom's deputy chairman, said a new financing model would be announced this month and that the European companies were still preparing to find a way to contribute to the pipeline's construction.
"Theoretically, Gazprom could carry the whole cost but I believe that our co-operation with our partners will not allow us to do it," Mr Medvedev told the Financial Times.
On Thursday, Gazprom chairman Alexei Miller met with Uniper chairman Klaus Schaefer in Moscow for talks on the pipeline.
"Gazprom and Uniper confirmed their intention to promptly put into operation Nord Stream 2," the Russian company said in a statement released after the meeting, adding that work on the project would be "carried out in accordance with the schedule".
Taking the full cost would significantly increase the burden on Gazprom, the world's largest natural gas producer, which is also spending €11.4bn on a new pipeline to Turkey. Gazprom in January budgeted just $1.8bn in investment this year for Nord Stream as part of a $15.3bn total spend on pipelines and transportation in 2017.
Many eastern European countries have objected to the pipeline, saying it will increase the EU's reliance on Gazprom and bypass existing gas pipelines in Ukraine, financially harming Kiev. Gazprom says the pipeline is a commercial venture.
Gazprom already supplies 34 per cent of Europe's gas. Exports to Europe and Turkey rose 12.5 per cent in 2016 last year to a record high. But low gas prices have hurt profitability and its share price has fallen 16 per cent this year amid costly legal delays.
Last month, chief executive of Austria's OMV, Rainer Seele, said that a deal to pay for the pipeline had to be implemented this year to ensure construction would begin next year, ahead of a scheduled opening of late 2019.
"Every participant has a preferred model," Mr Seele told Tass, the Russian news agency. "We should agree a common model, which is supported by the five potential European partners and Gazprom — but we do not have one as yet."
Gazprom has also been blocked from fully utilising Opal, an existing European pipeline, by European courts who temporarily upheld a Polish complaint that its dominant user status hurt competition.
"Blocking of Opal is giving us substantial financial damages," said Mr Medvedev, who described the decision as having been taken not with "economic consideration . . . but political consideration".
Mr Medvedev declined to say whether he felt Gazprom had been treated unfairly by European regulators, but expressed confidence that an upcoming European Court of Justice ruling would overturn the decision.
"I'm rather sure that objective consideration of the court is making support of Poland practically impossible," he said. "And we still believe in European justice and that's why I believe European Court has enough professional experts to separate political speculations from economic consideration."
Mr Medvedev also said that he expected a decision this year to resolve a longstanding financial battle between Gazprom and Ukraine's Naftogaz over a 10-year gas supply contract that ends in 2019, but admitted the two companies had yet to start discussions.
The two companies have appealed to the Arbitration Institute in Stockholm over claims and counter-claims worth almost $70bn relating to gas pricing and transit fees for gas pumped to Europe through Ukraine.
Mr Medvedev added that the company was open to discussing future gas supply contracts through Ukraine but had yet to agree with Ukrainian officials where the talks would take place.
|March, 23, 08:40:00|
|March, 23, 08:35:00|
|March, 23, 08:30:00|
|March, 23, 08:25:00|
|March, 23, 08:20:00|
|March, 23, 08:15:00|
WNN - Asia needs nuclear energy to meet its economic, energy and environmental goals, but such plans are still in the development phase in the South East region of the continent, Agneta Rising, director general of World Nuclear Association, said.
NPD - Preliminary production figures for February 2018 show an average daily production of 1 944 000 barrels of oil, NGL and condensate, which is a decrease of 83 000 barrels per day compared to January.
AOG - China National Petroleum Corporation (CNPC), the world’s third largest oil company, has been awarded stakes in two of Abu Dhabi’s offshore concession areas following the signing of agreements with Abu Dhabi National Oil Company (ADNOC).
REUTERS - U.S. West Texas Intermediate (WTI) crude futures CLc1 were at $63.69 a barrel at 0744 GMT, up 15 cents, or 0.2 percent, from their previous close. Brent crude futures LCOc1 were at $67.56 per barrel, up 14 cents, or 0.2 percent.