Gazprom Signs Corrective Gas Price Contract with E.ON

Gazprom Export, the export arm of Russian energy Gazprom, has signed a revised gas price deal with Germany’s E.ON, bringing the terms of its long-term natural gas deliveries into line with compensation deals with other European customers, Gazprom said on Tuesday.

“This agreement is a compromise and takes into account current trends in the natural gas market development,” Gazprom Export head Alexander Medvedev said at the signing ceremony.

The agreement stipulates a retroactive downward price revision from the fourth quarter of 2010. E.ON expects a 1 billion euro increase in its half-yearly financial results from the Gazprom price revision agreement, the company said in a statement.

Following the Gazprom deal, E.ON has raised its 2012 EBITDA forecast to 10.4-11 billion euros from 9.6-10.2 billion euros and its net income forecast to 4.1-4.5 billion euros from 2.3-2.7 billion euros.

Other European gas consumers have previously received a 10 percent price discount from Gazprom.

Some European energy companies, such as Italy’s Edison, Germany’s RWE and E.ON and Poland’s PGNiG’s, appealed to the Stockholm Arbitration Tribunal last year for a ruling on gas price discounts and a switch to gas spot prices, which were far below gas prices set in Gazprom’s long-term contracts.

Poland’s state-owned oil and gas firm PGNiG is seeking a 20 percent discount for supplies of Russian gas from Gazprom, Dziennik Gazeta Prawna newspaper reported on Tuesday, quoting source close to the Polish company.


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