Berlin to nationalize largest gas importing company due to energy crisis

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Uniper on the brink of insolvency ahead of Russian gas shutdown

Uniper, the largest gas distribution company in Germany, is about to be nationalized by the Berlin government before going bankrupt due to the energy crisis. Uniper’s own management says in a statement that it has reached agreement with the board of the Federal Chancellor, the Social Democrat Olaf Scholz, about a renewed rescue program, which includes a capital injection of 8,000 million euros. In addition, the German state is buying all Uniper shares held by the Finnish Fortum consortium. “The result means that the Federation acquires a significant majority of Uniper’s capital,” emphasizes the gas distributor’s message. The final agreement has not yet been signed but is imminent, the company said.

The former subsidiary of the German energy consortium E.on is Germany’s main gas importer and has been fighting for months to survive, after cutting off Russian gas pipelines and purchasing gas from other suppliers at very high prices, forcing the contractually required deliveries to be made. customers are hugely flawed. This includes a large part of the municipal companies that generate electricity and heat in Germany. The federal government already came to Uniper’s rescue last June by taking over 30% of its capital to prevent the collapse. With virtually no gas flowing through the Russian-German “Nord Stream 1” pipeline, Uniper’s situation has deteriorated further in recent weeks.

Faced with this situation, Berlin has been negotiating for weeks with the Finnish energy consortium Fortum, which has no interest in bailing out Uniper to buy all its shares in the gas distribution company. The subject of negotiation is mainly a loan of 7,500 million euros that Fortum provided to Uniper last winter, the funds of which are practically exhausted. Fortum apparently has no intention of giving up that money. A clause in the contract for the granting of this credit stipulates that in the event of a change of ownership of the German gas importer and distributor, the money must be returned immediately.

Meanwhile, deposits with German gas reserves are already more than 90% filled, as announced on Tuesday by the federal economy minister, the green Robert Habeck. The process of filling the national gas reserves is a month ahead of schedule. Habeck was convinced that the target of reaching 95% by November 1 will be reached much earlier. The purchase of Russian gas as a result of the war in Ukraine is supplied by Germany with supplies coming from Norway, the Netherlands and Belgium via gas pipelines. The head of Economy was optimistic, pointing out that, despite the lack of Russian gas imports, Germany “is getting through the winter well”. The country is prepared, although “it needs a little luck with the weather,” Habeck said.

Source: La Verdad

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