German regulator takes over Gazprom Germania to ensure energy supply

FRANKFURT, April 4 (Reuters) – Gazprom Germania, an energy trading, storage and transmission business ditched by Russia’s Gazprom (GAZP.MM) on Friday, will be transferred to Germany’s regulator to ensure energy security, Economy Minister Robert Habeck said on Monday.

All voting rights in the company will be moved to the regulator, the Bundesnetzagentur, Habeck told a news conference. The move was immediately put into effect by publication in the Federal Gazette.

“The order of the trust administration serves to protect public security and order and to maintain the security of supply,” Habeck said. “This step is mandatory.”

Habeck added that security of supply was currently guaranteed at a time of crisis in energy ties between Germany and Russia in the wake of Russia’s Feb. 24 invasion of Ukraine.

The Bundesnetzagentur will be take over control up to Sept. 30, 2022. It will be entitled to remove executives, hire new staff and ask management how to proceed.

“Our goal will be to run Gazprom Germania in the interests of Germany and Europe,” Klaus Mueller, head of the Bundesnetzagentur, said in a statement.

The Economy Ministry said the move was to stave off possible acquisition of Gazprom Germania by JSC Palmary and Gazprom export business services LLC, both of Russia.

It was unclear who was behind the companies, the ministry said, implying that an acquisition was legally not permissible, given the investors were from outside the EU and about to operate critical infrastructure.

“We won’t leave energy infrastructure subject to arbitrary decisions by the Kremlin,” said Habeck.

Gazprom gave no details or explanation of its decision to terminate its participation in Gazprom Germania and all of its assets, which include subsidiaries in Britain, Switzerland and the Czech Republic. read more

Gazprom has been in the sights of European Union regulators for months over allegations, which it denied, that it was holding back gas that could have been released to lower soaring prices.

Sources said last week that its offices in Germany had been raided by EU antitrust authorities. read more

German Finance Minister Christian Lindner on Monday rejected an EU embargo on Russian gas imports as mounting civilian deaths in Ukraine increase pressure on the bloc to impose sanctions on Russia’s energy sector. read more

“We are dealing with a criminal war,” Lindner said before talks with his EU colleagues in Brussels. “It is clear we must end as quickly as possible all economic ties to Russia. We must plan tough sanctions, but gas cannot be substituted in the short term. We would inflict more damage on ourselves than on them.”

Habeck said earlier on Monday he was seeking to reduce Russia’s indirect economic influence on other parts of the energy industry, saying next in view was Russian oil incumbent Rosneft’s (ROSN.MM) bid to control German refinery PCK Schwedt.

Gazprom Germania’s intertwined network of units includes trader Wingas and storage firm Astora that operates 6 billion cubic metres of underground gas caverns in Germany and Austria.

UK arm Gazprom Marketing & Trading provides fuel to consumers including factors, restaurants and the national health service which has caused a lot of concern in Britain and pressure would be off those companies under the German move.

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