Page 10 - Euroil Week 49 2019
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EurOil PERFORMANCE EurOil
Gazprom improves offering at ESP
RUSSIA
Gapzrom faces stiff competion in Europe from LNG.
RUSSIA’S Gazprom announced on December 3 it would launch within-day gas deliveries at its electronic sales platform (ESP), as it looks to offer its European customers more flexible sup- ply options.
The ESP, which offers Russian gas to buy- ers in daily auctions on top of deliveries under long-term contracts, has sold almost 16bn cubic metres of gas since its start-up in September last year. Until now Gazprom has offered gas for delivery on a day-ahead, balance-of-month ahead, months-ahead and quarters-ahead basis.
“The platform now offers a new standardised commercial product,” said Gazprom’s export arm in a statement. “The framework agreement now includes a description of deal procedures as well as nomination procedures for products within delivery period ‘within day,’” it said.
Gazprom is also providing the opportunity for buyers to sign framework agreements for contracts running until January 2022. Till now, the current limit on contract length has been one
calendar year. This paves the way for the offer of longer delivery periods, including season-ahead and year-ahead.
In addition, the company said it had abolished a gas restriction of 1 bcm for contract obligations within one commercial framework agreement. It has also simplified the transaction conformation process, cutting the amount of paperwork.
“The electronic sales platform of Gazprom Export has proven to be an effective and reliable trading tool,” Gazprom Export head Elena Bur- mistrova said. “We believe that market interest in our platform will increase as a result of our latest innovations.”
Gazprom has seen stiff competition in Europe this year from a new wave of new LNG supply that has flooded the market. The company has used its ESP to target customers unwilling or unable to buy Russian gas under long-term con- tracts, that might otherwise buy LNG instead. According to Gazprom Export, 1.36 bcm of gas was sold on the platform in November.
POLICY
Romanian prosecutors drop $600mn fraud case at Petromidia refinery
ROMANIA
The case concerned a $600mn debt from the company’s privatisation in 2000.
ROMANIA’S Directorate for Investigating Organ- ised Crime and Terrorism (DIICOT) announced that it has closed the criminal investigation against Romanian company Rompetrol Rafinare, which operates the country’s biggest refinery Petromidia, and its parent-group KazMunayGas International (KMGI), but the state assets authority (AAAS) and another firm involved in the case can appeal in court the decision. Prosecutors surprisingly said that there is no evidence to suggest criminal action related to the case.
The case was related to a historic debt of $600mn that the Petromidia refinery had to repay to the Romanian state, dating back from the refinery’s privatisation, in 2000.
Under a provision in the privatisation contract reportedly purposely placed in favour of the buyer, the private investor converted as much as possible of the debt into shares, in order to get rid of the debt but also maintain the majority stake, and the state currently holds a 44% participation in the refin- ery. In addition, KMGI promised to contribute the Romanian state’s part in a joint investment fund
that is currently building Rompetrol car fuel sta- tions and plans to build a power generation plant at the refinery’s site as well.
In May 2016, DIICOT put KMGI’s stake in Rompetrol Rafinare and other assets worth around $600mn under distraint.
However, on December 5, DIICOT decided to drop the charges and lift the majority of pre- cautionary measures against Rompetrol Raf- inare and KMGI. The decision was sent to the parties, DIICOT explained when the informa- tion leaked to media.
Head prosecutor Bogdan Licu, contacted over the decision, said he was not aware but will check. “Justice is not working smoothly recently,” he said, quoted by Radio Free Europe.
The initial private owner of the refinery, Dinu Patriciu, paid $10mn for the refinery. In 2007, when he sold 75% to KMGI, he announced that the company was valued at $3.6bn. The refinery, controlled by Dutch-registered investment vehi- cle Rompetrol (currently KMGI) rarely posted small profits in Romania.
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w w w . N E W S B A S E . c o m Week 49 12•December•2019
