Edison's Profit Drops 7% to $207 Million Due to Venture Global's LNG Cargo Delays
(Reuters) — Italian energy group Edison said on Wednesday that its first-half net profit fell by 7% year-on-year to 187 million euros ($207 million), dented by a delay in LNG deliveries from the United States.
The Italian subsidiary of French nuclear group EDF said it had started arbitration proceedings against LNG developer Venture Global over the U.S. company's failure to supply LNG cargoes as agreed in a contract signed in 2017.
Edison did not give an estimate of the hit, but said it had "a strong negative impact". It also said it had incurred costs to restructure old plants and sites.
Sources familiar with the matter have told Reuters that Shell and BP have separately filed for arbitration against Venture Global LNG for failing to supply contracted cargoes, even as it sold to non-contract customers as prices soared.
Edison, which bought LNG from the United States to replace Russian gas, had to find alternative supplies at higher costs, sources said.
In response to delay concerns in June, Venture Global said it was in "full compliance with all obligations under our long-term contracts, including timing".
Edison said its earnings before interest, taxes, depreciation and amortization (EBITDA) were up 33% to 829 million euros.
Based on the results for the first half, Edison expects its EBITDA to grow to at least 1.6 billion euros this year from 1.1 billion euros in 2022.
Earlier this year the group hired Intesa Sanpaolo and Lazard as advisers to evaluate options for its gas storage business in Italy.
Edison's CEO said earlier this month the group was nearing a decision over a potential disposal of the assets.
($1 = 0.9035 euros)
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