Shell Restructures Dutch Gas Business
LONDON -- The Dutch government is taking control of its country's gas transport network in a deal that analysts say will boost competition in the Netherlands and ease the way for the creation of a single European gas market, reported Reuters.
Oil giant Shell said on Monday that it and ExxonMobil, its partner along with the Dutch state in dominant Dutch gas supplier Gasunie, had agreed to sell their stakes in Gasunie's pipeline business to the government for 2.78 billion euros ($US 3.54 billion).
The creation of a separate gas transportation company will be welcomed by gas industry players who had long criticized Gasunie's ownership of the pipelines for limiting competition in the Dutch gas market. Companies who wanted to compete with Gasunie to supply end users have to pay it a tariff, which some said was too high, to use its pipes.
"With (Gasunie's) ownership of the grid, competition has not accelerated to any significant degree ... this is an important step for the creation of more liquidity and deeper competition," Mark Henderson, utilities analyst at Commerzbank Securities, said.
The spinoff of the transportation assets from suppliers echoes the market structure in Britain, which analysts said has the only truly competitive gas market in Europe. As more countries separate ownership of transport assets and gas-supply businesses, it should become easier for companies to transport gas within and between countries.
"Once the full liberalization comes, a French company could deal directly with [the world's largest gas producer] Gazprom, because in the middle will just be third-party gas transmitters and there will be a very visible formula for getting the gas," Henderson said.
Gasunie's retail division will remain as a joint venture, owned 50 percent by the Dutch government and 25 percent each by Shell and Exxon.
A spokesman for Shell said it and the U.S. oil major will each receive 1.39 billion euros ($US 1.77 billion) from the sale, which should be fully implemented by mid-2005.
Oil giant Shell said on Monday that it and ExxonMobil, its partner along with the Dutch state in dominant Dutch gas supplier Gasunie, had agreed to sell their stakes in Gasunie's pipeline business to the government for 2.78 billion euros ($US 3.54 billion).
The creation of a separate gas transportation company will be welcomed by gas industry players who had long criticized Gasunie's ownership of the pipelines for limiting competition in the Dutch gas market. Companies who wanted to compete with Gasunie to supply end users have to pay it a tariff, which some said was too high, to use its pipes.
"With (Gasunie's) ownership of the grid, competition has not accelerated to any significant degree ... this is an important step for the creation of more liquidity and deeper competition," Mark Henderson, utilities analyst at Commerzbank Securities, said.
The spinoff of the transportation assets from suppliers echoes the market structure in Britain, which analysts said has the only truly competitive gas market in Europe. As more countries separate ownership of transport assets and gas-supply businesses, it should become easier for companies to transport gas within and between countries.
"Once the full liberalization comes, a French company could deal directly with [the world's largest gas producer] Gazprom, because in the middle will just be third-party gas transmitters and there will be a very visible formula for getting the gas," Henderson said.
Gasunie's retail division will remain as a joint venture, owned 50 percent by the Dutch government and 25 percent each by Shell and Exxon.
A spokesman for Shell said it and the U.S. oil major will each receive 1.39 billion euros ($US 1.77 billion) from the sale, which should be fully implemented by mid-2005.