* First German company to raise alarm over scarce gas,
* Gas stocks lowest since early 2017
* Fortum says will help but crisis requires big efforts
* Works council wants German government to step in
(Updates with RWE, RBC comment, shares)
FRANKFURT/DUESSELDORF/BERLIN, June 30 (Reuters) - Germanys
Uniper is in talks about a possible government bailout
as the financial fallout from dwindling supplies of Russian gas
reverberates across Europe, sending shares in the energy company
The falling supply of gas has forced utilities across the
continent into expensive spot market purchases to plug the gap
while governments, worried about rising inflation, have capped
prices for consumers, squeezing the finances of suppliers.
A German Economy Ministry spokesperson said the government
was in talks with Uniper, one of Russian Gazprom's
biggest European customers, about stabilisation measures.
Uniper Chief Executive Klaus-Dieter Maubach said the talks
included possible guarantees, raising credit facilities or even
the state taking an equity stake. He did not say how much money
he was seeking.
Uniper shares in the midcaps index closed 14.4%
lower. They are down 66% since the beginning of the year and at
their lowest since March 6, 2017. Finland's Fortum,
which has a 78% stake in Uniper, fell 6.1%.
Fortum said it was supporting Uniper, which was forced to
ditch its financial forecasts and issue a profit warning, with
credit lines and guarantees, but it said the nature of the
critical situation required "national and sector-wide
The head of Uniper's works council said the state should
step in, possibly taking a majority.
German Chancellor Olaf Scholz, speaking during a NATO summit
in Spain, said in reference to Uniper that the government knew
what to do when it came to helping companies facing external
shocks, without elaborating.
Uniper's plight will raise pressure on the government to
allow utilities to pass on soaring energy costs to consumers, a
step Germany stopped short of triggering when it moved to the
"alarm" stage of its emergency gas plan earlier this
Berlin fears public protests if gas price hikes hit
consumers in their millions directly. It is aiming to fill gas
storage to 80% to prevent the crisis from escalating over winter
and has reached 61% so far.
Governments across Europe are taking action to prop up
strategic companies. Spain has approved a bailout package and
the Czech Republic has been in talks with utilities about
offering aid while new rules in Hungary allow the government to
supervise energy firms. In Britain, however, dozens of energy
companies caught between rising costs and the UK's energy price
cap, have collapsed in the past 12 months.
UNIPER ALREADY UNDER STRAIN
Russia's invasion of Ukraine has exposed the EU's and
particularly Germany's dependence on Russian gas supplies.
Uniper, the first energy company in Germany to ask the state for
help, said it had received only 40% of the contractually agreed
gas volumes from Gazprom since June 16.
Across Europe the dwindling supply of Russian gas has
sparked a frantic search for alternative energy sources, such as
seaborne gas on liquefied natural gas (LNG) tankers, often at
much higher prices.
Already before the war in Ukraine Uniper had asked for a 2
billion euros credit line from state-owned KfW bank, which has
not yet been drawn, Maubach said.
The company had to write off a $1 billion loan to Nord
Stream 2, the suspended new pipeline for Russian gas, in
It is trying to renegotiate contracts with customers,
traders said, although Uniper said no customers had been
approached about contracts in the context of the withdrawal of
its financial outlook.
Canadian bank RBC, noting that Uniper had already been
downgraded to the lowest investment grade rating by S&P, said:
"Unless there is intervention to support the company, the
situation looks precarious."
The bank's analysts said the focus will turn to other
Germany's RWE said in a statement to Reuters that its
liquidity is sufficient and it was not in talks with the
Ahead of its first-half earnings due on Aug. 2, Uniper,
which encompasses the activities of former gas champion Ruhrgas
and serves customers across Europe, withdrew its 2022 profit
It now expects earnings before interest and tax to be
significantly below previous years.
Global gas prices have been spiralling upwards since last
year due to a stronger than expected post-COVID economic
recovery while Russian exports had been quietly falling and
inventories had been run down.
Europe is anxiously awaiting scheduled maintenance during
July 11-21 on the Nord Stream 1 pipeline, which brings gas to
Germany from Russia, hoping Russia reopens the pipeline as
Gazprom maintains it is a reliable energy supplier that
fulfils all its obligations.
The benchmark Dutch front month price of gas was up 6.2%.
Aurora Energy Research said European gas prices
could go up by two thirds by the end of this year if Russian gas
exports were halted.
Gazprom's share price meanwhile, was off 28% on Thursday
after shareholders blocked a plan to pay dividends on last
(Reporting by Vera Eckert, Tom Kaeckenhoff, Markus Wacket;
additional reporting by Jesus Aguado, Jan Lopatka, Ron Bousso,
Nina Chestney, Danilo Masoni; additional writing by Tom Sims;
editing by Paul Carrel, Elaine Hardcastle and Susan Fenton)