Wintershall Dea draws Q1 balance sheet - "Billions would fall if project were abandoned to Russia"

After the write-off of the Nord Stream 2 financing had recently been the dominant topic at Wintershall Dea, triggered by the war in Ukraine, the current presentation of the quarterly figures at Wintershall Dea focused on the handling of the remaining Russia-related business of the oil, but above all gas producer. While the annual press briefing for the past fiscal year - shortly after the start of the war - had been canceled, company CEO Mario Mehren now used the Q1 results to announce a "clear no" to new projects in Russia. "There can't be a 'business as usual' with Russia now, there won't be."

At the same time, Mehren made it clear that "despite calls for an energy embargo and an immediate halt to all existing projects in Russia," the company had decided to maintain its involvement in existing production projects in Russia. "I can understand the calls for an immediate halt to imports of Russian gas - but I also understand the complex dilemma the German government is facing," Mehren said. With an eye on "competitiveness, prosperity and our social peace," gas imports from Russia could be "replaced, but not quickly." Moreover, in the event of a withdrawal from existing projects, billions in assets would fall to the Russian state.

Instead, Mehren affirmed, Wintershall Dea wants to strengthen its portfolio outside Russia and is considering entering markets in new countries, Mehren said - including with investments in carbon management and hydrogen. In light of ongoing efforts to diversify European energy sources, Wintershall Dea is "looking at all options for additional gas volumes and additional energy supply," Mehren said. These included the major Nova, Njord and Dvalin projects in Norway. It hopes to start production "as early as the end of this year," he said. In addition, Wintershall Dea is looking at global opportunities both in countries where it is already active and in new countries, he said.

Overall, Mehren reported, Wintershall Dea had written down 1.5 billion euros on its Russia-related assets in the first quarter of the current year, resulting in a net loss of 1 billion euros in the quarter. However, the company's financial performance remained "robust and resulted in strong cash flow, driven by the external environment and strong production," Mehren said. EBITDAX rose 161 percent year-on-year to EUR1.8 billion in the first quarter of 2022 given, while adjusted net income rose to EUR669 million, an increase of 291 percent. Free cash flow increased 156 percent year-on-year to 1 billion euros. Quarterly production of 669,000 boe/day was 2 percent higher than in the prior-year period.