Eneco scales back Russian gas purchases
Dutch energy utility Eneco will let some of its gas supply deals with Russia's Gazprom expire without renewal in light of events in Ukraine, but it will retain a key contract with Gazprom's German subsidiary until 2030, the company told NGW on March 23.
Eneco sources around 10-15% of the gas it buys from Russia directly. Its short and mid-term contracts with Gazprom are held with the latter's London-based entity.
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"We will not extend or renew them, due to the situation in the Ukraine," Eneco said. "We foresee ample opportunity to replace these sources."
The circumstances surrounding its deal with the German arm of Gazprom are more complex. Eneco entered a long-term contract in 2010 with Gazprom's WinGas subsidiary, and will not exit the deal until it expires at the end of this decade.
Gazprom gained 100% ownership of WinGas following an asset swap agreement with BASF's Wintershall in 2015. WinGas' pipelines include the 702-km Mitte-Deutscheland-Anbindungsleitung pipeline, which connects North Sea gas fields with the Dutch border at Bunde.
"We decided to continue this contract, mainly for two reasons. One, termination would endanger the affordable security of delivery for our clients," Eneco said. "It would also mean offering Gazprom [the chance] to make an enormous amount of extra money. The gas they [no longer] have to deliver to us, for a relatively cheap price, they will [instead] be able to sell for the current market prices. We do not want to give that opportunity, also with an eye to the situation in Ukraine."