FRANKFURT, July 8 — German energy giant Uniper said today it was haemorrhaging tens of millions of euros a day since Russia limited gas supplies to Europe’s largest economy, as it asked for government support.
“Under the current circumstances we are seeing cash outflows in the mid two-digit million range,” Uniper CEO Klaus-Dieter Maubach said.
Uniper, one of the biggest importers of Russian gas, “cannot endure for long” in the present situation, Maubach said, with the group making a formal bailout request to the German government.
Since Russian energy giant Gazprom reduced gas supplies to Germany via the Nord Stream pipeline by 60 per cent in mid-June, Uniper has been forced to pay higher prices on the spot market to make up the shortfall.
Unable to pass the cost on, Uniper has accumulated “substantial losses”, the company said in a statement.
Without support from the state, Uniper could finish “up to €10 billion (RM45 billion)” in the red this year, Maubach said.
The German government this week rushed through emergency legislation to facilitate support for struggling energy companies such as Uniper.
Uniper’s bailout request included the possibility for the German state to take a stake in the struggling energy company.
The Duesseldorf-based group also asked for some of the price rises faced by the company to be passed on to consumers, in line with the new legislation.
As a result of the Russian supply reduction, consumers were faced with a “very big price wave” that would see bills rise, Maubach said.
“We will not allow a system-critical company to become insolvent,” Economy Minister Robert Habeck said in a statement.
The government would however choose the option that was “the most affordable” for consumers and the “most secure” for Germany’s energy supplies, Habeck told local broadcasters.
Separately, Uniper’s largest shareholder Fortum said it was in discussion with the German government over the bailout.
One option under consideration involved reorganising Uniper to “ringfence the system-critical German businesses under the ownership of the German government”, the Finnish group said in a statement. — AFP
