Germany wants to nationalize “Gazprom” and “Rosneft” units

The German government is considering nationalizing the property of 2 Russian energy giants, which occupy a significant place in Europe’s largest economy: according to Handelsblatt, Gazprom Germania manages the country’s gas storage facilities, and Rosneft Deutschland accounts for a quarter of Germany’s oil refining business, Business Insider reports.

In addition, Berlin is also considering expropriating the assets of Gazprom (MCX:GAZP) to force it to sell its gas storage facilities across the country.

The plans have sparked enthusiasm from the ruling coalition: “The situation is serious and requires extraordinary measures,” said Bernd Westphal, spokesman for the parliamentary energy group of Chancellor Olaf Scholz’s Social Democratic Party.

If Russia’s energy companies were nationalized, they would come under German control, thereby weakening Russia’s influence on energy security and better ensuring the continuity of gas supplies to the country in German efforts to bolster energy security amid Russia’s ongoing special operation in Ukraine, authorities said. Last week, Germany launched an emergency action plan for natural gas supply disruptions after Russian President Vladimir Putin demanded payment for gas in rubles.

According to the plan, the country is in an “early warning phase” of an energy emergency for now, and Berlin is urging all consumers – from industry to households – to save energy and reduce consumption. If the situation worsens, gas could be rationed; with industry first in line for blackouts, as indicated by Germany’s economy ministry. But such a move could cripple the country’s economy and lead to the loss of numerous jobs.

Despite promises by the country’s Economy Minister Robert Habeck to stop using Russian gas by 2024, things are not working out as the authorities would like: Russian gas accounted for 55% of Germany’s gas imports in 2021 and 40% in the first quarter of 2022.

Germany’s plans to nationalize Russian assets were met with sharp criticism from Kremlin spokesman Dmitry Peskov, who said it was against international law.

Another country that is considering nationalizing Russian energy assets is Britain. It has said it is preparing to temporarily nationalize Gazprom’s local retail gas supply unit because it could collapse and cause disruptions to the country’s gas supplies.

Berlin is also considering options to restructure Wingas, a Gazprom unit that accounts for about one-fifth of Germany’s gas market.

Meanwhile, Gazprom announced last Friday that it would divest its stake in Gazprom Germania and all its assets, including Gazprom Marketing and Trading.


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