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.