Page 11 - EurOil Week 48 2021

EurOil PERFORMANCE EurOil

Gazprom income soars to new record in

Q3 on European gas supply crunch

RUSSIA CORE earnings (EBITDA) at Russia’s state- Wholesale prices at the Dutch TTF hub have
owned gas supplier Gazprom soared to a new soared above $1,000 per 1,000 cubic metres
Gazprom expects higher record in the third quarter, against a backdrop during recent months. Gazprom sold its gas on
earnings in the fourth of a severe supply crunch on the European gas the continent at an average price of RUB17,840
quarter. market that has led to historically high gas prices. ($238) per 1,000 cubic metres in January to Sep-
The company, the world’s largest gas pro- tember, as the majority of its contracts are either
ducer with a share of around a third of the Euro- indexed to longer-term prices at European gas
pean market, reported EBITDA of RUB809bn hubs or oil prices. In the third quarter alone the
($10.8bn) for the three-month period, repre- price was $313.4.
senting an all-time record and 2.4 times more “It is obvious that in Q4 the price of our sup-
than it booked for the third quarter of 2020. It plies to Europe will be significantly higher, which
also marks the sixth consecutive quarter of earn- will have a positive effect on the results of the
ings growth for Gazprom, which was hit harder whole year,” Sadigov said.
than most other suppliers during the coronavi- Gazprom also generated record free cash flow
rus (COVID-19) induced market collapse early of RUB83bn for the third quarter and RUB682bn
last year. for the first nine months of the year, while it man-
Gazprom spokesman Famil Sadigov said the aged to reduce its net debt to EBITDA ratio to 1.2
group anticipated even higher earnings in the by the end of September. It is targeting a ratio of
fourth quarter, as the European market remains 1.0 by year-end.
unusually tight amid low levels of storage, eco- Revenues were also buoyed by higher vol-
nomic recovery, cold weather and global supply umes. While Gazprom has faced accusations of
constraints. withholding gas supply to jack up prices, its sales
The company also generated a record net volumes to Europe and other countries outside
income of RUB581.8bn ($7.8bn) for the third the former Soviet Union increased to 175.7bn
quarter, marking a reversal from a RUB251.3bn cubic metres in the first three quarters of this
loss a year earlier. Net profit too is expected to year, up from 154.4 bcm in the corresponding
climb higher during the remainder of 2021. period of 2020.™

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