BASF slams EU gas network regulation plan - report
May 31st, 2008 | by admin |FRANKFURT, May 31 (Reuters) - German chemicals maker BASF(BASF.DE: Quote, Profile, Research), also active in Europe’s gas market, thinks a EuropeanUnion proposal to regulate gas distribution would lead to less,not more, competition, a German weekly has reported.
EU policymakers, keen to boost competition, called last yearfor separate corporate entities to handle supply anddistribution but met opposition from some of the bloc’s membersincluding Germany and France.
Earlier this month a compromise was proposed under whichcompanies could retain ownership of gas supply and distributionbusinesses but under stringent conditions and heavy regulation.
“We will not operate any (gas distribution) networks underforced administration,” the Euro am Sonntag financial weeklyquoted Hans-Ulrich Engel, the BASF board member in charge of thegroup’s oil and gas business, as saying.
“Nobody will be prepared to invest in new infrastructureunder these conditions. If the EU Commission implements itsplans, there won’t be more competition but less,” Engel said ina preview received on Saturday of a story due for publication inprint on Sunday.
The EU compromise envisages a compliance officer who wouldhave strong powers to ensure that required long-term investmentsin energy infrastructure are made and that the network companyis independently managed.
BASF’s Wingas subsidiary supplies natural gas to municipalutilities, regional gas suppliers, industrial companies andpowerplant operators in Europe.
Engel said Wingas’s annual deliveries would increase to morethan 40 billion cubic metres in 2010 from 37 billion cubicmetres currently, Euro am Sonntag said.
BASF’s oil and gas business accounted for 18 percent ofgroup revenue in 2007.
(Reporting by Peter Starck; editing by Christopher Johnson)
