Gazprom to start European trading this year
London, 4 July (Argus) — Russian state-controlled Gazprom's export arm is to start trading at European hubs this year, deputy chief executive Alexander Medvedev said.
The department will be officially opened in December, but trading will start earlier, he said. "We want to earn more from gas sales," Medvedev said.
The new department will sell gas at European hubs, which the firm's London-based marketing and trading subsidiary already does.
Gazprom's export arm plans to create a gas hub in St Petersburg, which could be used in export contracts, a Gazprom official said. "Gazprom marketing and trading is a price taker when we want to be a price maker," the official said.
The firm expects the creation of a liquid hub and trading platform to take time, but said its auctions in the past two years were a "first step". Gazprom has no plans to stop auctions once the export arm starts trading, Medvedev said.
The company may hold an auction in the fourth quarter if a decision is reached in early September, chief executive Alexei Miller said. The firm could provide more details, including the delivery points and period, in September if it decides to hold an auction.
Gazprom has no plans to curtail the activities of the marketing and trading arm, despite setting up a similar department in its export business. The marketing and trading business is in the process of being merged with recently acquired German subsidiaries Wingas and WIEH. The export branch's trading department could eventually take over some of the marketing and trading arm's responsibilities.