The German government may have to pour another up to $39 billion (40 billion euros) in saving the country’s largest natural gas importer, Uniper, on top of a multi-billion euro rescue package and nationalization, German business daily Handelsblatt reported on Thursday, quoting financial and government sources.
Last month, the German government, Uniper, and the company’s majority shareholder, Finland-based firm Fortum, agreed on a plan to nationalize the energy giant, aimed at preventing a collapse of the German energy and gas suppliers. Germany will own 99% of Uniper after the nationalization, which involves a capital increase of $7.9 billion (8 billion euros), is completed.
Germany, Europe’s biggest economy, aims to save its energy companies which have been amassing losses with the lack of contracted Russian gas supply and the high price they have had to pay on the spot market to replace lost Russian volumes.
Since the July $15 billion bailout of Uniper, losses at the German company have continued to mount as the energy crisis in Germany and Europe has worsened.
But Uniper now may need another liquidity injection after the government scrapped an idea to introduce a gas levy to all consumers, which would have gone to energy companies.
The rescuing of the biggest gas importer in Germany is becoming increasingly expensive for the government, which may have to splash a small to mid-double-digit sum in euros. In total, the new rescue package could cost the government another $9.8 billion (10 billion euros) to $39 billion (40 billion euros), a source familiar with the discussions told Handelsblatt.
After the scrapping of the idea of a gas levy, Uniper will now need additional liquidity assistance, the newspaper reported. The German government could come up as soon as next week with a new concept on how to further help Uniper, according to Handelsblatt’s sources.
By Tsvetana Paraskova for Oilprice.com