* Part of Russian company's strategy to expand in Europe:
Konig
* Gazprom took sole control of trader in October 2015
* Competition key to achieving fair gas price
Gazprom's now 100%-owned gas supply and trade subsidiary Wingas can
play an important role in helping Gazprom expand its presence in
Europe, the head of the German company said in an interview this
week.
Gerhard Konig also said increased competition on European markets
was key to a fairer end-user gas price.
"The successful positioning of Wingas on the German and increasingly
on the European markets, supports Gazprom's strategy of expansion in
Europe," Konig said in Gazprom's Blue Fuel newsletter.
Wingas was set up in 1993 by Gazprom and Germany's Wintershall to
supply and trade gas.
In September 2015, Gazprom took over Wintershall's share in the
company, giving it 100% control, in exchange for upstream assets in
Russia.
Konig said the fact that Wingas was now under full Gazprom control
would help both companies improve their European presence.
"The integration of Wingas into the Gazprom group is an enormous
opportunity for both companies to strengthen their market position,"
Konig said.
"We want to develop our trading and storage business in Germany and
our other core European markets together with Gazprom."
The long-awaited asset swap deal was finalized in September last
year, giving Gazprom full control of Wingas as well as traders WIEH
(Wintershall Erdgas Handelshaus Berlin) and WIEE (Wintershall Erdgas
Handelshaus Zug).
The controversial deal, first agreed in November 2012, was called
off in December 2014, but was again revived by the two long-term
partners last year.
The swap, which is financially retroactive to April 2013, was
heavily scrutinized by European antitrust authorities as it gives
Gazprom increased control over the EU's gas markets.
STORAGE CONTROL
Konig said that Gazprom taking full control of Wingas "helps to
strengthen supply security for the European customers even more."
"At the same time, it shows how important the European gas market is
for the world's largest gas producer," he said.
Gazprom now also has full control of the astora storage company,
which owns facilities in Rehden and Jemgum in Germany, as well as a
share in the gas storage facility in Haidach, Austria.
Konig said that Gazprom owning gas storage in Europe was a major
benefit.
"It is hardly possible to create more supply security for Europe,"
he said.
Through astora, Wingas has over a fifth of Germany's storage
capacity at its disposal "which makes a really important
contribution to the country's supply security," Konig said.
With its 4.4 Bcm of working gas, the Rehden storage facility is the
largest storage facility in western Europe.
"With the foreseeable continuing decline of Europe's own production,
additional gas imports will be necessary, which means the importance
of gas storage will also grow," he said.
He added that Gazprom was the "only notable producer" that is
actively contributing towards supply security on the market and is
investing in supply security through new pipelines.
"It is therefore very much in Gazprom's interests to keep the gas
flowing to Europe," he said.
--Stuart Elliott,
stuart.elliott@platts.com
--Edited by Maurice Geller,
maurice.geller@platts.com
© 2016 Platts, The McGraw-Hill Companies Inc. All rights reserved.
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