Gazprom, with 75 percent in Wingas Storage UK, has managed to bypass Britain’s competition laws and retain control over the storage.
Photo: Alexander Miridonov
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Gazprom Bypasses UK’s Competition Law
Ofgem, Britain’s Office of Gas and Electricity Markets, is wiling to let a joint venture of Gazprom and Wingas bar the way for exterior gas suppliers to use underground gas storage facilities in the Saltfleetby deposit, due to be put into operation in two years. Ofgem may recognize this right as it says the storage will be owned by two companies with equal shares. In fact, Gazprom is to hold 75 percent in the underground gas storage.
ZMB Gasspeicher Holding, where Gazprom owns 66.67 percent, is buying a 50-percent-stake in the Saltfleetby deposit from Wingas Storage UK, a subsidiary of Wingas, the AK&M news agency reported yesterday. An underground gas storage with the capacity of 0.75 billion cu. meters, the second-largest in the UK, is to be built on the base of this continental gas deposit in 2008.
British authorities view Wingas Storage UK as a joint venture of Wingas and ZMB Gasspeicher Holding where the two companies have equal shares. Last November, Wingas Storage UK asked Ofgem to make an exception from the law that binds to provide access for exterior gas suppliers to the storage facilities. British officials replied that an exception can be made in case the storage is owed by two companies with equal shares. Ofgem gave its tentative agreement this June.
The decision has not been announced yet. However, Wingas Storage UK will not be owned by two companies on a parity basis. Firstly, Gazprom is set to increase its holding in Wingas. Under an agreement between Gazprom and BASF on the exchange of assets, the Russian gas monopoly will drive its share in Wingas from 35 percent to 50 percent minus one stock. Secondly, Gazprom already has control over ZMB Gasspeicher Holding, the owner of a half in the Saltfleetby deposit. 66.67 percent in Gasspeicher Holding is owned by Gazprom’s subsidiaries. The remaining stocks belong to Austria-based Centrex where the Russian gas company has recently increased the holding up to 100 percent.
Gazprom, with 75 percent in Wingas Storage UK, has thus managed to bypass Britain’s competition laws and retain control over the storage.
Natalya Skorlygina
All the Article in Russian as of Aug. 16, 2006
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