German subsidiary Uniper causes heavy losses for Finnish energy giant Fortum –

Fortum’s subsidiary Uniper, Germany’s biggest importer of fossil gas, ran into serious trouble after Russia cut supplies, and it was forced to buy gas from other markets at higher prices. high to serve its customers under fixed long-term contracts.

Finnish energy company Fortum, 51% state-owned, announced on Thursday a net loss of 7.4 billion euros between April and June this year. Fortum’s share price fell more than 3% on the Helsinki Stock Exchange.

A rescue plan for Uniper was agreed in July between the Finnish and German governments and Fortum. As part of the approved “stabilization package”, the German government became a 30% shareholder of Uniper in exchange for 15 billion euros in equity and cash. The Finnish company remains Uniper’s largest shareholder, with a reduced share of 56%.

But Uniper’s gas business problems continue to weigh on Fortum.

“The situation is not expected to improve until the beginning of October, when the German government will introduce a tax on all gas customers to cover 90% of the replacement costs for gas supply,” he said. said Fortum CEO Markus Rauramo.

According to Rauramo, Fortum’s “underlying” energy business is “healthy” and the company posted an operating profit of 574 million euros in the second quarter.

Fortum is also in the process of finding buyers for its investments in Russia. Lately, Russia has banned foreign countries from getting rid of energy projects in the country.

James R. Rhodes