OAO Novatek, Russia’s second-largest natural gas producer, wants to expand overseas through its trading unit even as larger rival OAO Gazprom retains a monopoly on exports.
“Novatek Gas and Power was created to do trading operations,” Leonid Mikhelson, Novatek’s chief executive officer, said today at a groundbreaking ceremony for a port at Sabetta, Russia. “There is nothing to ask Gazprom.”
The billionaire declined to confirm that Novatek had signed a supply deal with Germany’s EnBW Energie Baden-Wuerttemberg AG (EBK) last week. The Tarko-Sale based company doesn’t pose any threat to Gazprom’s export monopoly, nor is anyone considering changing the law, he said.
Gazprom and Novatek are negotiating a deal where the export monopoly would ship as much as 6 billion cubic meters a year of gas for Novatek for a fee, two people close to Gazprom who declined to be identified said on July 13.
EnBW signed a contract with an unidentified foreign supplier for gas supplies of 1.9 billion cubic meters a year for 10 years from October, Germany’s third-largest utility said in a statement on July 12. Novatek will supply the gas, three people with knowledge of the deal said at the time, declining to be identified because they weren’t authorized to speak on the matter.
Novatek is in talks with major European customers on sales of liquefied natural gas, or LNG, Mikhelson said from the arctic port site from which Novatek plans to use as shipping base for the Yamal LNG project.
The company is also looking to purchase a Russian gas trader by the end of the year to expand its market share in a Russian region.
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