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European Firms on Verge of Bankruptcy as Energy Crisis Deepens
The energy crisis unfolding in Europe is starting to weigh on a growing number of the continent’s oil, gas, and utility companies.
Uniper, Germany’s struggling natural gas utility giant, recently filed a bailout application to the government after facing significant financial challenges, according to Finnish majority owner Fortum.
For weeks, the firm had been in regular talks with the government regarding a potential bailout, recently warning that it needs to be rescued “in a few days.” Uniper has faced tremendous pressure after Russia started reducing its gas flows to Germany, the biggest gas importer. Over the last month, the energy giant has received just 40 percent of Russian contracted volumes, prompting the business to search for replacement volumes.
“We welcome that the German Parliament has now approved a ‘toolbox’ which will allow immediate relief to the effects of the gas supply crisis,” said Markus Rauramo, the president and CEO of Fortum. “Next, we look forward to the German government to start promptly implementing these tools to stabilise the situation in the energy industry and in particular at Uniper, as we continue talks on a long-term solution.”
Uniper had started tapping into the gas it had been storing for the winter since Moscow slashed its deliveries. As a result, its storage facilities are only 58 percent full, down from just 60 percent in the previous week.