German Utility EnBW Signs Foreign Gas Strategy Deal

German utility Energie Baden-Württemberg (EnBW) has said that it has signed a 10-year gas deal with an unnamed foreign company for the supply of 1.9 billion cubic metres of gas a year.

The gas is delivered for an annual cost of approximately €600 million and supply will begin from October of this year.

EnBW announced Thursday that it had signed this deal, saying the agreement fit in with both its medium- and long-term gas strategy goals. In a statement, the company said the deal expanded its position in the gas midstream "considerably". 

 "We are optimising our gas procurement portfolio significantly with the gas supply contract," Hans-Peter Villis, Chairman of the Executive Board at EnBW, said at that time. "This is a prerequisite for us structuring our own offers in the future as an independent portfolio manager and being able to benefit from an extended value creation chain. The long-term and large volume supply contract also safeguards EnBW economically against the unpredictability of gas procurement."

Though the company did not name its foreign partner, Reuters news agency has reported that EnBW's new gas supplier may be Russian independent Novatek, according to two sources close to the matter.

A spokesperson for Novatek refused to make any comment to the news agency, while a spokesperson for EnBW told Reuters that it respected the unnamed company's wish to remain anonymous.