DThe federal government is apparently preparing a loan worth billions to save a former German subsidiary of the Russian state gas company Gazprom PJSC. This is reported by people familiar with the matter, according to a report by the Bloomberg financial service. A rescue operation for Gazprom Germania GmbH can therefore take place as early as this week, with the state-owned KfW group likely to grant a loan of 5 to 10 billion euros, according to the people who did not want to be named. Talks are still ongoing and plans are subject to change.
The money is intended to stabilize the company’s finances and help ensure security of supply. Russia restricted supplies to Gazprom Germania earlier this year after Germany took control of Gazprom Germania. As a result, the company had to buy some of the energy it supplies to its customers on the spot market – at significantly higher prices.
Company owns several gas storage facilities in Germany
The Federal Network Agency said in a statement that it does not comment on speculation and that all those involved in Gazprom Germania are “working intensively to maintain business operations”. The Treasury Department did not respond to a request, while a spokeswoman for the Economy Department declined to comment.
Gazprom Germania has an important position in various energy markets in Europe: The company owns several gas storage facilities in Germany, including the largest facility in the country. The company also owns Wingas GmbH, which supplies large industrial gas consumers in Germany. It also sells gas in the UK, where it also trades, and is active in the LNG business.
In April, the coalition presented a package of measures that would allow Berlin to place energy companies under state control. In addition, financing instruments were made available that would provide capital or enable KfW loans in the event of a supply crisis. Gazprom Germania will be managed in trust until September 30 and there are no concrete plans for further action. Gazprom Marketing & Trading, the London-based trading subsidiary, has already announced that it does not expect to become Russian property again.
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