The old natural-gas midstream model is “dead” and RWE AG (RWE) merged its trading and midstream businesses to reflect that, Stefan Judisch, chief executive officer of RWE Supply & Trading GmbH, said at Flame Amsterdam.
“We are in a golden age of gas, but not in Europe,” he told delegates at the annual gas conference today. “We are in a golden age of subsidized renewables. Photovoltaic makes sense economically to consumers, even without subsidies.”
RWE Supply & Trading had a 2011 loss of 800 million euros ($1.05 billion) and said last month it expects its operating loss to increase this year after rising crude prices boosted the cost of oil-linked natural-gas costs in 2011.
The Essen-based unit of RWE AG, Germany’s biggest utility, buys gas in long-term contracts linked to oil prices from suppliers including Statoil ASA (STL) and OAO Gazprom, the world’s biggest producer of the fuel.
“Gas has a security-of-supply problem,” Judisch said today. “Governments cannot decide when the sun will shine.”
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