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Gas trading from the East
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Gas trading from the East

June 30, 2015
Interview with Benjamin Lakatos – L'Agefi, 30 June 2015 Translation of the original French article “Setting up a base in Switzerland is one of my best decisions”

MET. The group was formed in Hungary and extends across central Europe and the East. The holding is in Zug, where the group trades gas and electricity.

MET was founded when the market was relaxed and freed from the control of major corporations and state-owned companies. The Group’s CEO, Benjamin Lakatos, is pleased that he chose Switzerland as its working base. MET Group was formed in Hungary but four years ago its holding company – specialised in natural gas trading – was set up in Zug as MET Holding AG. MET also conducts its trading operations from its base in Zug.


Can you sum up your operations for us?

Natural gas trading in central and eastern Europe constitutes the most important part – around 85% – of our operations. We cover all the hubs in mainland Europe. Our group was formed in Hungary 8 years ago as a natural gas wholesaler at a time when the market was relaxed and freed from the control of major corporations and state-owned companies. Before, gas producers were forced to ensure their own transport, which concentrated the market in the hands of several players that were able to secure the investment needed. The deregulation of the European market made an entry ticket much more reasonable, which enabled private companies to penetrate the market. This turning point gave us the opportunity to grow, not only in Hungary but also in neighbouring markets, and we are now established in Croatia, Hungary, Romania and Slovakia and have a holding company in Switzerland. We trade in gas and electricity from our base in Switzerland. Our oil and liquefied petroleum gas (LPG) operations take place in London.

Is the market still so easy to penetrate now?

We are experiencing a second watershed. Strong foundations are needed to finance operations today and players must once again be fairly large to compete.

MOL Hungarian Oil and Gas's presence in your capital must help.

That is true: MOL, the 2nd biggest central European company, holds 40% of our capital. Although it is neither a supplier nor a preferred client.

How much gas do you handle?

Around a billion cubic metres for small clients and three billion for wholesale distribution.

In which gas hubs are you particularly active?

We are registered at all the European gas hubs, and we are one of the three to five main players in Vienna and one of the fifteen most active on the TTF in the Netherlands. We also have storage capacity in six countries, not all of which are in eastern Europe. Trading essentially requires a strong logistics infrastructure and effective risk-taking. We cover all our positions and close them every day, even the most exotic positions. To do this, we have developed our own internal risk management systems.

How do you trade electricity?

MET entered the electricity market two years ago. Using our sales teams developed to work on the gas market, we take a local approach for this and concentrate on central and eastern Europe. We have also taken over from GDF the Dunamenti power station in Százhalombatta, Hungary, the biggest natural gas unit in the country, with a capacity of 635 megawatts. With the provisions that are – and will be in the future – in place on CO2 emissions, this type of station should have a bright future. Furthermore, in March we signed a partnership with Magyar Telekom, now a Deutsche Telekom subsidiary, for the distribution of natural gas and electricity to industrial clients in Hungary, with a view to developing together the same sort of operations in neighbouring countries.

What about petrol?

MET trades in petrol and LPG from its London base. We decided on this because we had the opportunity to start working with first-level experts there more than eighteen months ago.

Will gas and oil prices continue to decouple in Europe?

All the European operators are now turning towards the prices set by gas hubs. The price of gas is based less and less on long-term contracts between suppliers and buyers valued on the price of raw gas. That trend is not so clear in the global market.

You readily say that setting up in Switzerland is one of the best decisions you've made. Why?

Contrary to what many people think, the generous tax system is not the main reason why Switzerland is an attractive place for businesses. Zug offers us a setting where our lines of business are understood, which is very rare elsewhere. The accounting rules are tailor-made and we have even found a new modus operandi. Switzerland also offers significant financing benefits as it is the world's leading financial trading centre. Finally, as Switzerland offers real credibility in our industry, we are able to attract high-level experts who would not work with us under other circumstances.

With regard to financing, you have recently obtained a sizeable credit line.

We signed a renewable credit line of 400 million euros in March with a group of banks managed by ING.


For the French online version please click here

For the original print article please click here