ENGIE Getting Out of Coal and Oil, Not LNG

Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--French energy firm ENGIE (EPA:ENGI) (Paris, France) has denied recent reports that it plans to exit the liquefied natural gas (LNG) arena but has confirmed that it will be exiting the coal and oil sectors.

Reports that the company was planning to sell off its struggling LNG business came on the heels of an alleged decision to cut more than 1,100 jobs from its French LNG operations. Earlier this week the company's French union CGT claimed that the company was considering a possible reorganisation or sale of its division. ENGIE-- formerly GDF Suez--employs 155,000 around the world, with 74,000 based in France.

However, ENGIE Chief Executive Officer Isabelle Kocher told Reuters that while times were tough, LNG would continue to play a central role. "No, gas really is part of our activities. Shipping gas to countries which today are relying on coal and which want to switch to gas, that is at the heart of our business. We are working on our supply chain because prices have fallen and therefore earnings are under pressure."

Turnover at the company's Global Energy Management and LNG division fell by 47% in the first half of this year, thanks to lower oil and gas prices. Kocher denied that there are any major redundancy plans.

The company is planning to exit the coal-fired power sector and the oil producing market where it remains a minor player. Earlier this year ENGIE made it clear that it wanted to sell its Polish coal-fired assets, a decision that mirrors that of fellow energy giant, Électricité de France SA (EPA:EDF) (Paris, France). However, Industrial Info in recent weeks reported that the Polish government has passed new regulations that will try to block both companies from selling what it classed as "vital" power and heating assets. For additional information, see September 13, 2016, article--Poland to Block Sale of Key Energy Assets.

At the start of this year ENGIE announced the summer closure of the 1,050-megawatt Rugeley coal-fired power plant in Staffordshire, England. For additional information, see February 15, 2016, article--ENGIE to Shut Unprofitable Rugeley Coal-Fired Plant in the U.K..

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