Takeover rumours have been swirling around Centrica since 2005

Centrica's shares surged as much as 25% on Thursday amid speculation that Russia's Gazprom may bid for the firm.

However, Gazprom distanced itself from the rumours, as the Department of Trade and Industry (DTI) said the security of the UK's energy supply "is paramount".

Analysts said that any foreign bid for Centrica would be tricky and its shares closed down 2.25% at 293.25p.

'Status quo'

"Any new ownership would face robust scrutiny by the regulatory regime before entering the UK market," the DTI said in a statement.

"The energy market regulator Ofgem and the competition authorities would have to be satisfied that consumers' interests were assured by any merger activity," it explained.

Would the authorities wave through a deal which would take a large part of the UK market into foreign hands? Clive Roberts, Charles Stanley Check Centrica's share price

Centrica owns British Gas and is the UK's largest utility firm with more than 17 million electricity and gas customers.

Gazprom is the world's biggest gas producer, and its chairman Alexander Medvedev - a close adviser to President Putin - told the BBC it recently aspired to become one of the world's largest energy companies.

The problem facing a company like Gazprom is that a bid is likely to become a political rather than business issue.

Clive Roberts, an energy analyst at Charles Stanley, said he doubted that authorities would approve any move by Gazprom for Centrica.

"On the one hand Gazprom does not have any UK exposure at the moment so the UK status quo would be maintained," he explained.