Uniper, a German energy provider, is discussing the possibility of bailouts with the government, the Ministry of Economy said Thursday.
Uniper’s share price is expected to fall 20% after revising its financial forecast, and earnings are expected to be “significantly below” the previous year. Based in Düsseldorf, the company is Germany’s largest importer of Russian gas. According to the company, since mid-June, it has received only 40% of the gas ordered from Gazprom, forcing it to buy gas “at a significantly higher price” in the spot market.
This month, Gazprom reduced the amount of gas sent to Europe through Nord Stream 1, a submarine pipeline connecting Russian gas fields with Germany’s northeast coast. Supply cuts have forced utilities across Europe to buy gas at higher prices as the government scrambles to fill storage tanks before winter.
“The German government and Uniper are discussing stabilization measures,” the Ministry of Economy said Thursday.
Uniper CEO Klaus Dieter Mobach said his company is discussing several options with the government, including credit lines and government funding for the company. Uniper plays an important role in supplying gas to municipalities across Germany, helping the country store the gas it needs to survive the winter.
Last week, the German government launched the second phase of its three-stage energy gas program. In the next final step, the state can start ordering gas distributions that heat private homes over industry, prioritizing important public services, including hospitals.
Germany’s economic minister, Robert Habeck, warned that if Russia’s gas supply remains as low as it is today, the country could face shortages by winter.
He said the financial pressure on German energy companies could be serious, comparing the infectious effects of the way the collapse of Lehman Brothers caused the global financial crisis.
