Reuters reported that Italian energy group Edison has won in arbitration EUR 450 million discounts on its liquefied natural gas supplies from Qatar’s RasGas, a verdict that paves the way for other European firms to secure cheaper energy and pass cost savings to cashstrapped consumers.

The company said that the court decision has accepted the merits of Edison's positions the overall impact on 2012 accounts of Edison is estimated in EUR 450 million.

Edison which last year successfully challenged Russian gas export monopoly Gazprom to reduce the cost of long term gas supplies can hold up as an example to peers its latest coup against the world's biggest LNG exporting country Qatar.

A source close to the arbitration process said that it's a breakthrough win as it paves the way for other European companies in the same situation to renegotiate gas prices with Qatar. The price review success has the potential to reduce the final gas sale to businesses and households in Italy and also Europe as other companies might follow the same path in renegotiating the contracts with their suppliers.

At issue is decade’s old system of indexing gas supplies to oil prices that has hurt European utilities because they are forced to sell the gas at a loss losing billions of euros in the process. Qatar which liquefies its gas for export on tankers adopted the same model set by Europe's two biggest pipeline exporters Russia and Norway by linking gas supplies to oil prices.

Source - Reuters

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