Statoil Reduction Positive News for RWE

German utility RWE has said that its financial performance has improved partly due to a revised contract with Norwegian oil and gas major Statoil. The contract, which was revised earlier this year, brings the price of gas supply to RWE in line with market prices.

Despite an 11 per cent decline in gas sales and an 8 per cent decline in electricity sales for the first half of 2012, the company says it has increased its operating result by 9 per cent to €3.6 billion and its EBITDA by 9 per cent to €5 billion.

Revenue remained stable and almost unchanged at €27.1 billion.

However, despite the improvement in performance, resulting from a renegotiated gas contract with Statoil and a better energy trading performance, the company said that the outlook for the future still remained challenging, due to a number of factors.

"The present framework conditions are anything but favourable," CEO of RWE Peter Terium said today in a statement. "Mounting state intervention in the energy sector, shrinking power plant margins and fierce competition in electricity and gas supply are all challenges we are facing."