DONG Energy pulls out of German gas network

Source: Heren

2011/01/14

Denmark's DONG Energy has sold its share in the DEUDAN pipeline to Gasunie Deutschland, both parties have confirmed to ICIS Heren.

Gasunie Deutschland agreed to buy DONG's 49% share in the joint venture in December, boosting its stake in the pipeline to 75%. The DEUDAN pipeline connects Denmark and Germany.

The number of transmission system operators operating the gas grid in the German market area GASPOOL has thus been reduced to three: Wingas, ONTRAS and Gasunie Deutschland. DONG, however, will keep its shares in the GASPOOL Balancing Services, according to a GASPOOL spokesperson.

DONG would not comment on its plans regarding this matter, but stated that it intends to focus completely on its supply business in Germany.

Gasunie Deutschland said that the purchase of the additional DEUDAN-shares was in line with their business strategy for the country.

"In Germany, the Gasunie transport system will need to be expanded by as much as 40%," the company had said in December (see ESGM 16 December 2010), specifically stating that they plan to invest €1bn-1.5bn into increasing interconnection with Scandinavia. The purchase of the DONG stake, however, was not included in that number, according to Gasunie Deutschland.

The DEUDAN pipeline was originally built in 1981 to transport gas from Denmark to Germany. In October, a reverse flow option was installed, and the first gas deliveries from Germany to Denmark were carried out in December. The remaining 25% in the joint venture is held by Open Grid Europe, the former E.ON gas transport. JR