Gazprom posts strong European sales

Russian energy company credits momentum to increase in the value of the national currency.
By Daniel J. Graeber Follow @dan_graeber Contact the Author   |   Jan. 15, 2016 at 6:56 AM
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MOSCOW, Jan. 15 (UPI) -- Russian energy company Gazprom said it sold more natural gas to European companies and yielded more profit for the nine months ending Sept. 30.

Gazprom reported financial figures, stating total sales gas natural gas increased 9 percent compared with the same period in 2014. In terms of volume, gas deliveries to European and other regional countries were up 2 percent from 2015.

"The overall increase in sales of gas to Europe and other countries was driven by the increase in average Russian ruble price by 20 percent compared to the same period of the prior year," the company said in its filling.

A mid-2015 plunge in the value of the ruble, a weakened energy sector and restrictions to Western markets that came as a result of sanctions pressure has hurt exporting economies like Russia's. Russian President Vladimir Putin said earlier this week inflation was on the rise, while gross domestic product is on the decline.

The Kremlin expects GDP growth of around 0.7 percent for 2016.

Gazprom's performance comes amid pressure from its European consumers to address competition concerns. Ukrainian energy company Naftogaz filed an official complaint in Europe last week, arguing Russian gas pipeline expansion plans would limit competition.

Net sales of gas to former Soviet republics, a group that includes Ukraine, declined 4 percent for Gazprom.

Igor Artemyev, the head of Russia's Federal Antimonopoly Service, in October suggested a breakup of Gazprom in an effort to address leverage concerns.

Russia holds the largest reserves of natural gas in the world, accounting for about a quarter of the world total of proven reserves. Last year, the Kremlin said it expected gas production for full-year 2015 would be lower than last year by about 2 percent.

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