German energy regulator to support Gazprom Germania operations

The Astora natural gas depot, which is Western Europe’s largest natural gas storage, is pictured in Rehden, Germany, March 16, 2022. Astora is part of the Gazprom Germania group. REUTERS/Fabian Bimmer

FRANKFURT, April 8 (Reuters) – Germany’s energy grid regulator said on Friday it would ensure the continuity of operations of Gazprom Germania, a trading, storage and transmission company dumped by Russia’s Gazprom and called on market operators not to cut ties.

With assets and subsidiaries in Germany, Great Britain, Switzerland, Belgium, the Czech Republic and outside Europe, the company’s activities are essential for the European gas market and its supply to industries and households.

“The Bundesnetzagentur will ensure that all payments from Gazprom Germania GmbH are only made to maintain business operations and thus prevent an uncontrolled outflow of funds,” the German regulator said in a letter to operators linked to Gazprom Germania and seen by Reuters.

“It will also ensure that the business can and will meet its payment obligations to continue its business operations,” he added.

Gazprom Germania GmbH was placed under the control of the regulator on April 4. read more

Its activities, based on Russian gas production, cover supply to wholesalers and retailers, storage and pipeline transportation, covering the entire gas value chain.

The regulator, in its letter to banks, business partners, service providers and customers, said the company must procure gas and have the means to pay for it, avoiding insolvency.

“The consequences (of an insolvency) for the energy supply system, not only in Germany but also in Europe, would be serious,” he said.

Trading companies could collapse, transport would be disrupted and underground storage caverns would remain empty, he said.

The decision taken on April 4 by the authority, taken due to a planned acquisition of the company by two companies outside the EU, allows it to dismiss managers, hire staff and lead the management, and to guard against a flight of funds.

Reporting by Vera Eckert and Tom Kaeckenhoff; edited by Maria Sheahan and Jason Neely

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