The German government has temporarily taken control of two subsidiaries of Russia’s energy behemoth Rosneft. The government’s action places it in charge of Rosneft’s stakes in three refineries in the country.
This includes a key facility in the country’s northeast that supplies roughly 90% of Berlin’s fuel and in which Rosneft has a majority stake. According to Germany’s economy ministry, the move was necessary to combat an impending threat to energy security.
Germany assumed charge of subsidiaries of Russian gas giant Gazprom in a similar move in April. The German government gave the national energy regulator control of the PCK Schwedt refinery in Brandenburg, as well as stakes in two other refineries in the country’s south.
According to the economy ministry, the move was necessary because critical service providers and customers were no longer willing to work with Rosneft, threatening the refineries’ continued operation.
The Schwedt refinery, Germany’s fourth largest, is the primary supplier of gasoline, diesel, and aviation fuel to Berlin and the surrounding area. Rosneft owns 54 per cent of the facility.
Since the pipeline’s construction in the 1960s, the refinery has received all of its crude from Russia via the Druzhba. Schwedt also serves parts of western Poland.
Rosneft Deutschland, which accounts for approximately 12 per cent of German oil processing capacity, will be placed under the trusteeship of the Federal Network Agency regulator, which stated that the original owner no longer had authority to issue securities.
The regulator was also given control of RN Refining and Marketing, a Rosneft subsidiary.
“With the trusteeship, the threat to the security of energy supply is countered and an essential foundation stone is set for the preservation and future of the Schwedt site,” Germany’s economy ministry said.
It claimed that critical suppliers such as insurance companies, IT providers, and banks were no longer willing to work with Rosneft, either directly or through its subsidiaries.
Rosneft Deutschland’s shares in the MiRo refinery in Karlsruhe and the Bayernoil refinery in Vohburg have also been taken over by the Federal Network Agency. Rosneft owns 28 per cent and 24 per cent of the companies, respectively.
Under European sanctions imposed in response to Russia’s invasion of Ukraine, Germany is required to halt Russian oil imports by the end of the year.
According to the ministry, the move on Friday included a package to ensure that the Schwedt refinery could receive oil via alternative routes.
It is unclear who could take over as refinery operator in place of Rosneft. Shell, which owns 37.5 per cent of Schwedt, has long desired to exit the company.
Germany said this week that it would increase lending to energy companies threatened by rising gas prices after Russia cut supplies to Europe in retaliation for Western sanctions.
Uniper, a German utility, said on Wednesday that the government may take a controlling stake, claiming that an earlier state rescue package worth €19 billion was no longer sufficient.
SEFE, formerly known as Gazprom Germania, has also been placed under trusteeship by the government after Russian energy giant Gazprom abandoned it in April.
(Adapted from Reuters.com)
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