Russian gas export monopoly Gazprom has cut gas prices for long-term contracts with European energy firms to bring them in line with trends on spot markets, the head of Gazprom’s export arm Alexander Medvedev said on Tuesday.
“Proceeding from the fundamental principles and terms of the existing long-term contracts, Gazprom Export reached and formalized agreements in late 2011 and early 2012 with some major European buyers, stipulating a certain adjustment in the price of Russian natural gas purchased under these contracts,” Medvedev said.
The lower gas prices apply to Gazprom’s contracts with GDF Suez, German Wingas, Slovakian SPP, Italian Sinergie Italiane and Austrian Econgas, Medvedev said.
The move was made taking into account “trends on the European gas market and the situation in the economy and the energy sector of some European states,” Medvedev said.
Some European energy companies, such as Italy's Edison, Germany's RWE and E.On and Poland’s PGNiG's, earlier appealed to the Stockholm Arbitration Tribunal for a ruling on gas price discounts and a switch to gas spot prices, which are far below gas prices sealed in Gazprom’s long-term contracts.
Until now, only Edison had been successful, obtaining a 200 million euro discount from Gazprom.
The companies for which Gazprom has now cut gas prices, are not among the firms that appealed to arbitration in Sweden.
In response to arbitration appeals by some European companies, Gazprom said it could reach agreement with some European consumers by the end of 2011 outside arbitration proceedings.
In its third-quarter report, Gazprom said it was holding commercial negotiations on discounts with RWE Transgas, SPP, Shell Energy Europe, E.On Ruhrgas, Eni, GDF Suez, EconGas, GWH Gashandel, Centrex and PGNIG.