Mon, 08 Aug 2022

Uniper took a financial hit due to reduced gas supplies from Russia, according to media reports

German energy major Uniper is seeking a government bailout due to the financial fallout from dwindling supplies of Russian natural gas, Reuters reported on Thursday.

Talks are ongoing to provide "stabilization measures" for the utility, according to the German Economy Ministry. "The reason for this is the sharp rise in gas prices and the reduced supply volumes from Russia," it explained.

Uniper Chief Executive Klaus-Dieter Maubach said the negotiations included possible guarantees, raising credit facilities, or even the state taking an equity stake. He didn't reveal how much money the company was seeking.

"Business development has noticeably deteriorated due to the war in Ukraine," Maubach told Bloomberg. The supply squeeze has reportedly prompted the energy firm to withdraw its outlook for the year.

READ MORE: Germany calculates costs of cut in Russian gas supply

One of Europe's largest importers of Russian gas, Uniper has been under pressure due to the shortfall of supply from Moscow. This month, Russian gas flows via the Nord Stream pipeline to Germany were cut by as much as 60% due to parts shortages and technical issues arising from sanctions on Moscow.

The company's Unipro unit operated five power plants in Russia that accounted for almost a fifth of the utility's earnings last year. Sanctions, which block access to those profits, and international pressure prompted the company to begin the process of selling the unit.

For more stories on economy & finance visit RT's business section

(RT.com)

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