Joint Venture for Gas Trading in Spain and European Electricity Market Updates

Strategic Insights -

Italian energy company Eni and Spanish firm Iberdrola are partnering to establish a joint venture for gas trading in Spain, with the goal of securing a 15-20% market share by 2005. As part of this agreement, Eni's subsidiary Snam will be utilized to implement the joint venture, with Galpenergia, a subsidiary of Portugal's Galp, also participating in the initiative. Additionally, Iberdrola will acquire gas from Eni for its combined-cycle generation plants, and purchase a 10% stake in Enipower, Eni's electricity subsidiary. Meanwhile, the UK's Transco has established a new team to oversee its metering activities, and the European Commission has approved the acquisition of a 51% stake in German municipality Stadtwerke Kiel by US utility TXU.

Key Takeaways:

  • Eni and Iberdrola plan to establish a joint venture for gas trading in Spain, with the aim of reaching a 15-20% market share by 2005.
  • The joint venture will utilize Iberdrola Gas, a trading company already registered, and will include Galpenergia, a subsidiary of Portugal's Galp, in its operations.
  • Iberdrola will purchase 1.5 billion cubic meters of gas per year from Eni for its combined-cycle generation plants, commencing in 2002, for a 15-year period.
  • Iberdrola will acquire a 10% stake in Enipower, Eni's electricity subsidiary, with the goal of contributing to the company's planned growth of installed generation capacity from 1,000 MW to 5,000-7,000 MW.
  • Transco has established a new team to oversee its metering activities, which will help promote competition in the metering services sector.
  • Chris le Fevre has been appointed as the Director of Metering, leading the new team.
  • The European Commission has approved the acquisition of a 51% stake in German municipality Stadtwerke Kiel by US utility TXU.
  • TXU's electricity brokering activities in Germany will remain unaffected by the acquisition.

Statistics:

  • 15-20%: Market share goal for the joint venture between Eni and Iberdrola by 2005.
  • 1.5 billion cubic meters: Quantity of gas to be purchased by Iberdrola from Eni per year.
  • 2002: Commencement year for Iberdrola's gas purchase agreement with Eni.
  • 15 years: Duration of the gas purchase agreement between Iberdrola and Eni.
  • 1,000 MW: Current installed generation capacity of Enipower.
  • 5,000-7,000 MW: Planned installed generation capacity of Enipower.

Sources:

  • "Iberdrola and Eni set up joint venture for gas trading" (Source: Bloomberg)
  • "Transco Establishes New Metering Team" (Source: Transco Press Release)
  • "European Commission Approves Acquisition of Stadtwerke Kiel" (Source: European Commission Press Release)