Gazprom UK which supplies 4000 homes through Aberdeen Heat and Power facing administration

A Russian-owned energy firm that supplies thousands of Scottish homes is facing collapse.

Gas giant Gazprom UK could be placed into administration in the coming days.

The business supplies energy to a not-for-profit organisation in the north-east of Scotland, Aberdeen Heat and Power.

The organisation, set up by Aberdeen City Council, aims to alleviate fuel poverty in the city by supplying 4000 homes with heating and hot water.

On Tuesday, Bloomberg reported the UK Government is considering stepping in to run Gazprom Marketing & Trading Retail Ltd.

Aberdeen Heat and Power said it hadn’t been contacted by either Gazprom UK or the UK Government over the company potentially entering administration.

However, the organisation said it had served notice to the company terminating their agreement for later in the year due to Russia’s “terrible invasion of Ukraine”.

A spokesperson for Aberdeen Heat and Power said: “We’ve not been contacted by Gazprom UK or the government as of yet and await advice on a potential administration, so that continuity plans are in place.

“For the past 20 years, we’ve worked to alleviate fuel poverty and currently supply 4000 homes in the city with low-cost heat on a not-for-profit basis.

“We contracted with Gazprom UK in 2019, carefully following OJEU procurement protocols.

“However, following the terrible invasion of Ukraine and the suffering of its people we served notice that we are terminating our arrangement when our contractual obligations are met in October.”

Gazprom supplies energy to thousands of companies across the UK.

A UK Government spokesperson said: “The UK is in no way dependent on Russian gas, which makes up less than 4% of our supply. Our highly diverse sources of gas supply and a diverse electricity mix ensures that households, businesses, and heavy industry get the energy they need.

“We are aware that Gazprom Energy has a large presence in the non-domestic energy retail market. Gazprom’s retail business continues to trade in the UK and customers should exercise their own commercial judgement with regards to energy supply contracts they have in place at the moment.”