Relief for E.ON as Gazprom agrees to cut gas price

Germany’s largest utility, E.ON (FWB: EOAN), has received a significant boost after Russian energy group Gazprom (MICEX-RTS: GAZP) agreed to cut the price of long-term gas supply contracts.

After much tense negotiation, the agreement will enable it to raise its profit forecast, after a challenging 2011, following the German government’s decision to phase out nuclear power.

E.on
AFP reports that the Düsseldorf-based company nearly doubled its outlook for 2012 underlying net profit, and earnings before interest and taxes were forecast to hit €10.4bn-€11.0bn compared with the company’s old range of €4.1bn-€4.5bn.

E.OM, German rival RWE and Poland’s PGNiG had spent the past four years trying to get Gazprom to agree to price cuts. The Russians at the start of 2012 agreed a roughly 10 per cent price cut with another group of clients, including Italy’s Eni.

The news comes following the announcement by E.ON of its strategic investment in distributed generation. PEI carries a poll today asking if E.ON has made the right decision. You can vote here

For more European power news

     

 

Share
     


Did You Like this Article? Get All the Energy Industry News Delivered to Your Inbox

Subscribe to an email newsletter today at no cost and receive the latest news and information.

 Subscribe Now

Whitepapers

The Time is Right for Optimum Reliability: Capital-Intensive Industries and Asset Performance Management

Imagine a plant that is no longer at risk of a random shutdown. Imagine not worrying about losing...

Going Digital: The New Normal in Oil & Gas

In this whitepaper you will learn how Keystone Engineering, ONGC, and Saipem are using software t...

Maximizing Operational Excellence

In a recent survey conducted by PennEnergy Research, 70% of surveyed energy industry professional...

Leveraging the Power of Information in the Energy Industry

Information Governance is about more than compliance. It’s about using your information to drive ...