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ENERGY

Germany nationalises subsidy of Russian energy giant Gazprom

Germany announced Monday it was nationalising a former subsidiary of Russian energy giant Gazprom, saying the step was necessary because of the systemic importance of the company for power supplies in the country.

Gazprom offices Berlin
The offices of Gazprom in Berlin. Photo: picture alliance/dpa | Paul Zinken

The company Securing Energy for Europe GmbH (SEFE) was previously known as Gazprom Germania. It is a network operator, and indirectly controls Germany’s largest gas storage facility in the northwestern town of Rehden.

In the wake of Russia’s invasion of Ukraine and Moscow’s decision to dwindle energy supplies to Europe, Berlin had placed the company under its effective control in April, but the ownership of the company had remained unclear.

As a result, business partners and banks have suspended business relations with the company or are reluctant to enter into new ones, the economy ministry said.

“This jeopardises the continuation of SEFE’s business operations and thus the gas supply,” it added.

Once heavily reliant upon Russian energy, Berlin has been racing to wean itself off imports of gas and oil from the country.

READ ALSO: Russia’s Gazprom halts pipeline flow to Germany

Germany was formerly nationalising the company and turning it into a state asset.

Under complex accounting manoeuvrings, the company’s losses are offset against its capital reserves.

As a result, Gazprom loses its shareholding in the company, said the German economy ministry.

In turn, Germany will plough €225 million into the company, thereby taking over as “sole new shareholder”.

“This completes the change of ownership,” said the economy ministry. Germany also plans to offer the company a loan of €13.8 billion in a debt-equity swap arrangement by the end of the year, although the measure is
still under discussions.

READ ALSO: EU raids Gazprom’s Germany offices in antitrust price probe

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ENERGY

Norway and Germany seek Nato-led cooperation for key undersea structures

Germany and Norway want to start a NATO-led alliance to protect critical underwater infrastructure, their leaders said on Wednesday, weeks after explosions hit two key gas pipelines in the fallout from the war in Ukraine.

Norway and Germany seek Nato-led cooperation for key undersea structures

 “We are in the process of asking the NATO Secretary General to set up a coordination office for the protection of underwater infrastructure,” German Chancellor Olaf Scholz told a press conference in Berlin.

“We take the protection of our critical infrastructure very seriously and nobody should believe that attacks will remain without consequences,” he said.

Norwegian Prime Minister Jonas Gahr Store said the alliance would be “an informal initiative to exchange between civilian and also military actors” with NATO providing “a centre, a coordination point”.

Underwater cables and pipelines were “arteries of the modern economy” and it was necessary to create “a coordinated joint effort to ensure security for this infrastructure”, he said.

Scholz said he and Store would propose the plan to NATO Secretary General Jens Stoltenberg, who is due in Berlin for a security conference. The Nord Stream 1 and 2 gas pipelines off the Danish island of Bornholm were targeted by two huge explosions at the end of September.

The pipelines, which connect Russia to Germany, had been at the centre of geopolitical tensions as Moscow cut gas supplies to Europe in suspected
retaliation to Western sanctions over the invasion of Ukraine.

Although they were not in operation when the leaks occurred, they both still contained gas which spewed up through the water and into the atmosphere.

Russia and Western countries, particularly the United States, have traded bitter barbs over who is responsible for the blasts.

Several European countries have since taken steps to increase security around critical infrastructure. 

The G7 interior ministers warned earlier this month at a meeting in Germany that the Nord Stream explosions had highlighted “the need to better protect our critical infrastructure”.

Norway has become Europe’s main gas supplier in the wake of the war in Ukraine, taking the place of Russia.

The Scandinavian country has a vast network of pipelines, stretching for almost 9,000 kilometres, linking it to the continent, which experts have said are at risk of sabotage.

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