The Oslo business daily Dagens Naeringsliv, citing sources it did not name, reported Friday Eni is seeking that amount in an arbitration proceeding initiated against Statoil in August -- claiming it is paying a 50 percent mark-up over spot market rates due to long-term contracts tied to the price of oil.
Eni filed arbitration claims in August against Statoil and Dutch supplier GasTerra citing overcharges. It has successfully completed commercial negotiations with other gas suppliers such as Russia's Gazprom and Algeria's Sonatrach.
In the case of Gazprom, Eni secured a deal to adjust gas prices for the whole of 2013, while the two companies agreed to continue negotiations on the price parameters and volume of deliveries for 2014.
The reason Statoil's alleged selling price is so high above market price is the long-term supply agreement it signed with Eni in 1997, locking gas prices to oil prices. Since then, gas prices on the open market have become considerably weaker than oil prices, so Eni is seeking an adjustment.
Statoil had no comment other than to confirm Eni has started a arbitration proceedings against the Norwegian oil major.
"I do not comment on individual contracts," Statoil spokesman Morten Eek told Dagens Naeringsliv. "In general it can be said that an arbitration process in this context is nothing more than a neutral party review of what's appropriate conditions given the current market conditions."
Eni Chief Executive Paolo Scaroni has said the company needs to bring down the amount it pays for imported natural gas in a soft market that is seeing decreased demand.
He told The Financial Times last month gas consumption in Europe has fallen by 15 percent since 2008, partly because of high prices. The use of gas for electricity production, for example, plummeted by 25 percent from 2010 to 2012, while the use of coal for power generation has increased by 10 percent.
Scaroni called for gas prices in Europe to be ratcheted down to U.S. levels, which are only one-quarter of current prices in Italy, pointing out that production costs in Norwegian gas fields is lower than in the shale gas fields in the United States.
Speaking at a Johns Hopkins University energy conference last week, Scaroni noted "the most expensive gas we pay is to Statoil (not Gazprom). It's important to clear the misconception."
Last year, Italy imported 20.6 billion cubic meters of gas from Algeria, 13.6 billion cubic meters from Russia, 6.8 billion cubic meters from the Netherlands and 6.3 billion cubic meters from Norway, the Russian business daily Kommersant reported.
Since 2011, the vast majority of European companies consuming gas have successfully achieved the revision of long-term supply contracts using the argument that prices under long-term contracts based on the cost of oil have have remained high compared to the "fair" price of spot gas trading.
The majority of discounts that have been made to European buyers have been introduced retroactively.
Gazprom has paid out about $3 billion to its European customers retroactively in the last year, and it is expected it will have pay out an additional $1 billion, Kommersant said.
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