Centrica raps French gas merger

The deal would leave the French firms in control of a key pipeline

British Gas owner Centrica has urged the European Commission to block a merger between French utility firms Suez and Gaz de France.

In a written submission to Brussels, Centrica says the planned tie-up would limit competition and drive up prices.

A merger could leave a big question mark over UK supplies, Centrica warned.

The call came days after European competition watchdogs raided some of Europe's biggest utility firms as part of an anti-competition inquiry.

The EU has recently expressed concern about the need for more competition in energy markets across Europe, after a cold winter in which political problems led to supplies being disrupted.

Commission spokesman Jonathan Todd said the Commission was particularly worried about the way firms granted, or restricted, access to pipelines.

Supply fears

Centrica confirmed that it had raised concerns about gas supplies to the UK in its letter to Brussels.

A merger would leave the UK heavily dependent on gas supplied via a Suez-Gaz de France pipeline through Belgium and UK consumers could be forced to pay higher prices as a result, Centrica said.

The 70bn euro (£48.5bn) tie-up sparked controversy when it was announced in February, triggering claims that France was guilty of so-called "economic patriotism".

The deal came hard on the heels of the news that Italian utility Enel planned to bid for Suez and prompted a warning from Brussels that state efforts to protect firms from foreign takeovers were illegal.