Russia's invasion of Ukraine takes Wintershall Dea by surprise - Annual press conference canceled

The Russian president's military operation against Ukraine has caused the oil and gas group Wintershall Dea to cancel at short notice its annual press conference, at which it had planned to take stock of the past fiscal year in front of journalists. "We view the military escalation of the conflict with very great concern and consternation," company CEO Mario Mehren let it be known instead. "People are dying - we are shocked by what is happening." At the same time, the "latest military escalation is also shaking the economic cooperation between Russia and Europe that has been built up over decades" and will "have far-reaching consequences," Mehren said - "to what extent cannot even be foreseen today."

Wintershall Dea has been working in Russia for more than 30 years, Mehren added. "Many colleagues of ours work every day for our company and our joint ventures with partners from Russia. Many of our colleagues come from Russia or Ukraine - for them in particular, but also for all of us, this escalation on the orders of the Russian government is a hard blow," the Wintershall Dea boss said.

Specifically with regard to the suspended certification process for the Russian Baltic Sea pipeline Nord Stream 2, which Wintershall Dea is helping to finance, the company is "assuming compensation for the project company in the event of a shutdown of the Nord Stream 2 gas pipeline," according to a media report, as reported by "Der Spiegel." The company had expressed the assessment that "currently no resilient scenario is conceivable" in which "there would be political intervention without compensation." And even if the commissioning of the unfinished certification process for the pipeline is delayed, Wintershall Dea expects "that the contractual obligations to the financial investors will be fulfilled."

In the annual report, meanwhile, company CEO Mehren outlines fiscal 2021 as "an outstanding year for Wintershall Dea" - thanks in part to "commodity price levels." By keeping production costs low, Wintershall Dea had achieved a "record result."

Production totaled 634 thousand boe/day in 2021, "in the upper range" of the company's original planning. "We started the year very strong operationally, achieving record production of 659 thousand boe/day in the first quarter," the annual report said. In the fourth quarter, it said, a record 678 thousand boe/day was achieved. A total of six projects came on stream in 2021, it said, while the remaining major projects in Norway - Dvalin, Nova and Njord - which are expected to start production by the end of this year, are "well on track."

In 2021, Wintershall Dea had total sales of just under 8.12 billion euros, up from 3.89 billion euros the year before. Net profit amounted to 593 million euros, after the company had to report a net loss of 839 million euros in the previous year 2020 due to high depreciation and impairment losses on fixed assets.