Engie Says Gazprom to Reduce Gas Deliveries Starting Tuesday

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Engie Says Gazprom to Reduce Gas Deliveries Starting Tuesday
Credit: © Reuters.

(Bloomberg) -- Russian energy giant Gazprom PJSC (OTC: OGZPY ) has informed Engie SA (EPA: ENGIE ) of a reduction in gas deliveries starting Tuesday because of disagreements over some contracts, the French utility said, signaling a further squeeze in Europe’s energy supplies.

The announcement follows Monday’s call from French Prime Minister Elisabeth Borne for businesses to cut energy use or face possible rationing this winter if Russia halts gas deliveries. 

“As previously announced, Engie had already secured the volumes necessary to meet its commitments towards its customers and its own requirements, and put in place several measures to significantly reduce any direct financial and physical impacts that could result from an interruption to gas supplies by Gazprom (MCX: GAZP ),” the company said in a statement Tuesday.

Gazprom’s deliveries to Engie had already decreased “substantially” since the beginning of the war in Ukraine, with recent monthly supply of about 1.5 terawatt-hours, the company based near Paris added. That compares to the group’s total annual supplies in Europe above 400 terawatt-hours, it said.

Gazprom plans to halt supplies on the Nord Stream pipeline to Germany from Aug. 31 for three days of planned maintenance.    

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© Bloomberg. An Engie SA logo sits on display at the French energy giant’s Crigen gas, new energy and emerging technology research and development center in Stains, France, on Tuesday, Sept. 22, 2020. Veolia Environnement SA last month offered to buy 29.9% of Suez SA from French utility Engie for 2.9 billion euros ($3.4 billion), the first step to taking full control. Photographer: Cyril Marcilhacy/Bloomberg

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