Eni gas renegotiation effects are retroactive; talks going well
BY LIAM MOLONEY
MILAN – Eni’s key renegotiations of its natural gas supply contracts are progressing well and the benefits of a successful outcome are retroactive, said a leading executive of Italy' s largest energy company by market value Wednesday.
"There is quite good traction [in the discussions]...the effects are all retroactive to January 2013, with some to 2012," said Marco Alvera, head of Eni Trading, at a conference call to comment on first-quarter results.
Eni is holding talks with its main gas suppliers, such as Gazprom and Algeria' s Sonatrach, as part of its plan to make such contracts profitable, which were signed under long-term take-or-pay agreements. Such contracts tie the price of the gas Eni has to buy to more expensive oil prices.
Earlier Wednesday, Eni reported first-quarter results in which the gas and power division had $192.4 million in operating loss. This contrasts with a EUR1.02 billion profit in the same period of 2012, which was boosted by the successful conclusion of a separate round of gas contract renegotiations.