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ENERGY

Uniper rescue to cost Germany an extra €25 billion euros

Troubled gas giant Uniper on Wednesday said the German government would need to spend an additional €25 billion under a planned nationalisation to stave off the firm's collapse in the wake of Russia's war in Ukraine.

Uniper headquarters in Düsseldorf
The Uniper headquarters in Düsseldorf. Photo: picture alliance/dpa | Federico Gambarini

The German government agreed in September to nationalise the debt-laden company after Moscow’s closure of a key gas pipeline and sky-high energy prices left Uniper facing bankruptcy.

But the initial €8 billion cash injection from the government “will not be sufficient to stabilise Uniper”, the company said in a statement.

Another capital increase to the tune of €25 billion will be needed to help cover “the enormous additional costs of the Russian gas cuts that continue to be primarily borne by Uniper”, CEO Klaus-Dieter Maubach said.

The revised figure comes after Berlin scrapped a controversial plan to make German consumers pay a gas levy to help importers cope with rising prices, which would have covered some of Uniper’s costs.

READ ALSO: Germany reaches deal to nationalise troubled gas giant Uniper

The government will finance the rescue out of a €200 billion “special fund” designed to cushion the impact of the energy crisis on households and businesses.

Uniper said it would ask shareholders to formally approve the rescue deal on December 19th.

As Germany’s biggest gas importer, Uniper has been hit especially hard by the fallout from the Ukraine war, which forced it to buy gas at significantly higher prices on the open market.

It has reported a €40 billion net loss for the first nine months of the year, one of the biggest losses in German corporate history.

Germany’s government stepped in to save the company on fears that its collapse could endanger gas supplies and wreak havoc on Europe’s biggest economy.

Germany, which was heavily reliant on Russian gas imports before the war, has raced to find alternative suppliers and fill reserves before the colder winter weather arrives.

The country announced last week that its gas storage facilities were 100 percent full.

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ENERGY

German energy firm RWE takes Gazprom to court over supply halts

German's RWE said Tuesday it is taking legal action against Russia's Gazprom over halted gas supplies, the latest German company to do so since Moscow invaded Ukraine.

German energy firm RWE takes Gazprom to court over supply halts

Following the invasion, Gazprom steadily dwindled pipeline supplies to Germany in apparent retaliation for Western sanctions on Russia, sending energy prices soaring.

Last week, German energy giant Uniper said it was seeking damages from Gazprom at an international tribunal, as the Russian company’s failure to deliver gas had cost them billions of euros.

READ ALSO: Germany’s Uniper takes Gazprom to court over halted gas supplies

An RWE spokeswoman confirmed to AFP the company had also launched action, but declined to give further details.

Gazprom’s failure to deliver promised supplies has meant that German companies, long heavily reliant on Russian energy, had to buy gas on world markets at far higher prices.

Financial daily Handelsblatt reported that the costs incurred by RWE were likely lower, at around €1 billion, than those faced by Uniper.

Uniper had far larger contracts, and has put its losses from the supply halts at €11.6 billion. Gazprom has rejected Uniper’s claims.

The company, Germany’s biggest gas importer, has agreed a deal to be nationalised after Russia’s drastic reduction in supplies pushed it to the brink of bankruptcy.

READ ALSO: How Germany became ensnared by Russian gas

It reported a €40 billion net loss for the first nine months of the
year, one of the biggest losses in German corporate history.

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