Gazprom back payments lift RWE trading unit's result

FRANKFURT (Reuters) - Repayments made by Russia's Gazprom (MCX:GAZP) to German utility RWE (GER:RWE) for gas purchases going back to 2010 helped drive earnings at RWE's trading unit 1.3 billion euros ($1.7 billion) higher in the first nine months of this year, RWE said on Thursday.

RWE, in a wider row between Gazprom and some European buyers over prices in the summer, secured a ruling in its favour by an international arbitration court, prompting Gazprom to return some $1.5 billion in back payments to its German customer.

RWE Trading/Gas midstream posted an operating result of 903 million euros in the Jan-Sept period, compared with a loss of 403 million in the same period last year, slides prepared for a call with reporters on its earnings report showed.

RWE said it still saw burdens from the long-term oil indexed gas contracts but these were now "lower after commercial settlements of several contracts in previous years."

The trading division last year made a loss of 598 million euros. RWE said it would be profitable in full year 2013 and "significantly above last year's level", but it did not specify the forecast.

However, in another slide forecasting the 2014 fiscal year, it said that the trading unit would not enjoy the positive one-off from the Gazprom arbitration any further, and go back to normalised earnings.

The wider RWE group sees next year's operating result at 4.5-4.9 billion euros, down from a forecast 5.9 billion in 2013 as it battles with a deep crisis in the power market.

Many gas purchasing contracts in Europe are still linked to historically high oil prices, but utilities have successfully demanded lower bills linked to cheaper gas spot prices from suppliers in Russia and Norway.

Gazprom also re-paid RWE rival E.ON compensation on long-term gas supply, the bulk of which already arrived last year.

RWE, the second biggest gas supplier after E.ON, saw its gas sales rise 16 percent to 236.7 billion kilowatt hours year-on-year in the first three quarters. It cited higher demand for heating due to the weather early in the year and new customer acquisitions in the local utility and industrial sectors.

(Reporting by Vera Eckert, editing by William Hardy)