No decision yet for Uniper´s German support

Minister for European Affairs and Ownership Steering Tytti Tuppurainen on Thursday visited Berlin and discussed the financial difficulties facing energy company Uniper with German Minister for Special Affairs and Head of the Chancellery Wolfgang Schmidt and State Secretary for Financial Market Policy and European Policy Jörg Kukies, said a government press release.

She also met with State Secretary Udo Philipp from the Federal Ministry for Economic Affairs and Climate Action, State Secretary Werner Gatzer from the Federal Ministry of Finance and Uniper CEO Klaus-Dieter Maubach, among others.

“Today’s (Thursday) talks with representatives from the German government took place in a friendly atmosphere. Several different options were put forward. We have a great deal of work ahead of us and we need to come up with a solution in the next few days, or in the next few weeks at the very latest,” said Tuppurainen.

Meanwhile, Fortum is continuing constructive talks with the German government on how to stabilise Uniper both in terms of its financial position and its business risks, and thus to safeguard security of energy supply in Germany.

No decisions, however, have been made yet, said Fortum in a press release on Thursday.

“Faced with new geopolitical realities, we have to consider all options that will ensure security of supply and the stability of the European energy markets in the long run. I am very pleased that our main owner, the State of Finland is supporting us in reaching the solution,” said Fortum’s President and CEO Markus Rauramo.

“We are ready and very committed to continue working with relevant parties at the table towards a responsible solution that takes the needs of all stakeholders, including customers and employees into account. In this crisis, brought about by Russia alone, we all have to give something up to safeguard the future,” said Rauramo.

Fortum has stressed that a solution is required swiftly and that it needs to be sustainable also in the long-term.

This means it needs to achieve three objectives including ending the significant loss-making and cash bleeding of Uniper due to the continuing delivery curtailment of Russian gas; securing Uniper’s investment-grade credit rating, which is crucial in the energy business; and taking into account the new realities of unreliable gas flows from Russia.

In the event of prolonged gas curtailment and further gas price hikes, Uniper’s losses will not only continue to mount, but are likely to increase more dramatically.

The size of the losses for Uniper is substantially dependent upon cost compensation mechanisms to be put in place by the German government. So the keys to resolve this situation are therefore in the hands of Berlin.

Earlier on July 8, Fortum's subsidiary Uniper sought German government support.