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Russia's Gazprom sells more gas to Europe

May 11, 2011 at 1:38 PM   |   Comments

MOSCOW, May 11 (UPI) -- Gazprom's natural gas exports to Europe are growing rapidly, the company said.

Gas deliveries by the Russian state-controlled energy giant to European customers in April increased 20.5 percent over the same period last year, and volumes are expected to remain steadily high, Gazprom Chief Executive Officer Alexei Miller said this week.

"Gazprom's gas export volumes this May are virtually matching its winter volumes," Miller was quoted as saying by Russian news agency RIA Novosti. "The request for today's supplies is almost 500 million cubic meters. The volumes of gas supplies are increasing along with the demand for gas in Europe."

Gazprom last week finished the first leg of the 760-mile Nord Stream pipeline, designed to move up to 55 billion cubic meters of natural gas to Western Europe, enough to meet the demands of 25 million homes.

The pipeline, which is a major boost for Russian gas sales in Europe, could start delivering before the end of this year, said the companies involved, which apart from Gazprom include Eon Ruhrgas and BASF/Wintershall from Germany, Gasunie from the Netherlands and GDF Suez from France.

Laid through the Baltic Sea, Nord Stream is linking Russian gas fields with a seaport in Germany, a longtime Gazprom customer that may even increase its imports in the future.

German Chancellor Angela Merkel has announced plans to drop nuclear power production as soon as possible and as an alternative mentioned plans to build modern gas-fired power stations.

Miller in remarks last month was jubilant about the European natural gas market, saying it was "skyrocketing."

"This April, for instance, we are going to export more gas than in some of the winter months, and by December gas is expected to cost around $500 under our long-term contracts," Miller said in a statement posted on the Gazprom Web site. "I believe these are not the last record figures for this year."

The world's largest natural gas producer, Gazprom last month reported record earnings that trumped even those of ExxonMobil and Chevron, citing high oil prices (which in European long-term contracts determine the gas price) and a spike in demand. At the same time, Gazprom gradually raised prices at home to increase profits and reduce gas waste.

© 2011 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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