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The German federal network regulator has urged the customers, partners, and banks working with the German unit of Russian gas giant Gazprom to keep doing business with the company so as to avoid insolvency of Gazprom Germany and a possible threat to gas supply.
“Without being able to procure operating resources or offer services, the operational business would be at risk, while without access to financial resources, the group could face insolvency,” Germany’s Federal Network Agency, known as BNetzA, wrote in a letter seen by Bloomberg.
If banks and partners shun Gazprom Germania, as the unit is known, the company could become insolvent and threaten the security of gas supply in Germany, according to the German agency.
Gazprom Germania, based in Berlin, operates large gas storage facilities.
“The consequences for the energy supply system, not only in Germany but in Europe as well, would be severe,” the German regulator said in the letter seen by Bloomberg.
Germany receives around half of the natural gas it consumes from Russia, and it has been one of the main opponents of an energy embargo against Russia over Putin’s invasion of Ukraine.
Last week, reports emerged that Germany was mulling over the potential nationalization of the local units of Gazprom and of Russian oil giant Rosneft.
Germany is considering the idea of nationalizing the German units of Rosneft and Gazprom over concerns the companies that are systemically important for the German energy market could run into financial troubles, German business daily Handelsblatt reported last week, quoting sources in the government.
Chancellor Olaf Scholz is also involved in the talks about the potential nationalization of the German units of Rosneft and Gazprom, Handelsblatt reported, citing several government sources. Germany fears a shortage of energy supply if those two companies run into difficulties or become technically insolvent as banks are shying away from funding firms connected to Russia.
By Charles Kennedy for Oilprice.com
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Charles is a writer for Oilprice.com