WINGAS firmly believes in the growing importance of natural gas in the European energy mix.
"A German and European energy mix that is fit for the future can
only be secured if it includes a strong component of natural gas,"
WINGAS Chairman Dr. Gerhard König said confidently about the
company's further development. WINGAS is one of the largest natural
gas suppliers in Germany and is active in Belgium, the Netherlands,
the UK, France, Austria, the Czech Republic and Denmark as well as
on its home market Germany. "Natural gas is the fossil fuel with
the lowest CO2 emissions and will play a key role in expanding
renewable energies," König said at a press briefing by the company
in Salzburg in the run-up to the commissioning of the second
expansion phase of the Haidach natural gas storage facility. WINGAS
has a share of a third of the storage facility nearby Salzburg. The
WINGAS Chairman sees considerable growth potential in the future,
especially in the power station segment. "Flexible gas-fired power
stations are best suited to balancing out the fluctuations in
electricity generation from wind and solar energy." Despite the
current situation on the natural gas markets, which are
characterized by a surplus of supply and great volatility of energy
prices, the company was once again able to attain record sales in
2010.
Last year overall the WINGAS achieved considerable growth of over
five percent with sales of 323.6 (2009: 308) billion kWh.
"Particularly in Germany, where we increased sales by nice percent,
we were able to attain stronger growth than the market," the WINGAS
Chairman explained. Deliveries to customers on the German market
totaled 184.4 billion kWh. The company now has a market share in
Germany of about 20 percent in Germany. "As well as benefiting from
the brightening of the economic outlook, we also profited from the
cold weather during the winter months. But we also managed to close
many contracts with new customers," Dr. König explained.
In its foreign markets WINGAS achieved a small increase from 138.7
to 139.2 billion kWh. WINGAS had achieved growth on the European
markets as well as in trading on the international spot markets,
the Chairman remarked. The company's turnover fell from 7.599
billion in 2009 to 6.862 billion euros. Profit from operating
activities (EBIT) fell on the previous year's figure, primarily
owing to the transfer of the gas pipeline network to its subsidiary
WINGAS TRANSPORT, from 392.3 million to 284.6 million euros. Profit
after taxes rose from 255.7 million euros to 302.6 million.
A look forward to 2011
"Our business is and remains geared towards growth. 2011 looks set
to be a challenging year," the WINGAS Chairman said regarding the
prospects for the current financial year. With the growing
significance of the spot market, the increasingly fierce
competition and the integration of the European energy markets, the
demands placed on gas companies are also increasing.
In the first quarter of 2011 natural gas sales decreased in Germany
as a whole by about 10 percent on the previous year because less
heating was required during the relatively mild winter. WINGAS was
also affected by this trend. In 2011 the company expects to almost
match the previous year's sales - despite the continued intense
competitive pressure and the unusually cold winter in the winter
months of 2010. Turnover is expected to increase slightly as a
result of the higher gas prices triggered by the increase in oil
prices. "We will continue on our growth course - and we will remain
profitable," König announced.
The company also plans to strengthen its European activities. "We
now generate over 40 percent of our sales outside the German
market," König underlined. "We want to increase this segment. We
are therefore taking a close look at new sales markets." WINGAS has
already successfully entered the Dutch market. From 2012 the
company will supply the third-largest Dutch energy supplier Eneco
Holding N.V. with up to one billion cubic meters of natural gas
(around 10 billion kWh) a year. "This large-scale supply agreement
provides the foundations for achieving our objective of further
growth in the Netherlands," the WINGAS Chairman explained. WINGAS
plans to mirror the developments in Belgium in the Netherlands,
gradually building up sales, and is aiming for a market share of
around 10 percent by 2020. "The development in the Netherlands is a
blue print for the continued expansion of our European activities,"
the Chairman of the gas supplier emphasized.
Natural gas: partner for renewable energies
"Europe's own production of natural gas will decline significantly
in the next few years while demand continues to grow. For this
reason, securing the procurement side of operations is a
cornerstone of our corporate strategy," König went on. WINGAS meets
its demand primarily by means of long-term supply agreements. About
50% of the contracted volumes are supplied by OOO Gazprom export.
The supplies from Russia are supplemented with gas from the North
Sea. WINGAS has also increasingly taken advantage of the
procurement possibilities of the Western European spot markets,
such as the British National Balancing Point (NBP) or the Zeebrugge
Hub in Belgium. This allows WINGAS to profit greatly from the
favorable pricing structures on the spot markets.
For the WINGAS Chairman, the ready availability of natural gas, the
public's acceptance of this source of energy, and in particular the
extensive infrastructure are clear advantages for natural gas when
it comes to shaping the future energy supply: "Storage facilities
and transport are the key to a sustainable energy revolution. Wind
and solar energy need storage facilities and networks. And our
industry has already built these," König explained.
"We are bringing real added value to the partnership with renewable
energies thanks to our network and storage facilities. It is not
just natural gas and biogas that can be transported and stored with
the gas network; but also solar and wind energy in the form of
methane gas. "In other words our infrastructure is evolving into a
general energy storage system for Europe," König explained. With
the gas storage facilities in Rehden in North Germany, Haidach in
Austria and the Jemgum storage project on the German-Dutch border,
WINGAS is one of the largest storage providers in Europe.
Investments must be worthwhile
The natural gas company is driving forward the expansion of the
European infrastructure: the Haidach natural gas storage facility
was developed in recent years together with Rohöl-Aufsuchungs
Aktiengesellschaft (RAG) and OAO Gazprom. Following the recent
expansion phase, the second-largest storage facility in central
Europe now has a capacity of over 2.6 billion cubic meters. In
Jemgum storage operations will begin in two years - construction of
the first caverns began at the start of the year. König:
"Construction of the OPAL pipeline is also on schedule. The last
welding seam will be completed in the next few days, which means
the pipeline can come on stream as scheduled in autumn together
with the Nord Stream Baltic Sea pipeline." Construction of the
North European Gas Pipeline, NEL, which will transport the gas
arriving through Nord Stream to north-west Europe, commenced in
March. This project is scheduled for completion in autumn 2012. The
pipeline project is being realized with Dutch company Gasunie and
E.ON Ruhrgas. In addition, the Belgium gas transport company Fluxys
will acquire a share in NEL. Around 1.7 billion euros are being
invested by WINGAS in the next four years to expand the
infrastructure.
"We are taking on a considerable entrepreneurial risk with these
investments," the WINGAS Chairman explained. "But such investments
are at stake because of the frenzy of German and European
regulations." König thus called for an energy policy geared towards
Europe's interests
Author: Gerhard König
