Gas Natural says Algeria ruling to cost it two bln dollars
Spain's Gas Natural said Friday it would have to pay Algerian energy firm Sonatrach 1.97 billion dollars due to a retroactive gas price increase imposed by a ruling from an international arbitration court.
Last month's ruling that Gas Natural must pay a higher price retroactively for the gas it buys from Sonatrach will have an impact of 450 million euros on its 2010 net profit, the company added in a statement.
The ruling came after a three-year court battle between Gas Natural and state-owned Sonatrach.
In 2007 Algeria, which exports about nine billion dollars' (6.5 billion euros') worth of natural gas to Spain each year, proposed increasing prices by 20 percent in two stages over the course of a year to reflect higher global gas prices.
The country, Spain's biggest natural gas supplier, argued Sonatrach was losing money every year because Gas Natural refused to pay a price increase.
© 2010 AFP