Wintershall Dea Swings to Loss on Russia Exposure

Oil and gas producer Wintershall Dea swung to a loss last year, hit by significant impairments and losses related to Russia’s war in Ukraine, it said on Thursday.

Wintershall reported a group net loss of 4.8 billion euros ($5.1 billion), including 7 billion euros in one-off, non-cash losses related to its Russian upstream and associated midstream business after pulling out of the country last month.

The company had posted a 593 million euro net profit the previous year.

Adjusted net income last year was up 130% at 928 million euros, as the company’s operational basis proved robust in the energy crisis that lifted oil and gas prices.

Earnings before interest, tax, depreciation, amortization, and exploration expenses (EBITDAX) at the company, which is owned jointly by chemicals group BASF and investor group LetterOne, rose 91% to 5.9 billion euros.

Full-year hydrocarbon output was 321 million barrels of oil equivalent (boe), down 3% from 2021. 

Russia’s contribution has grown over the years to account for half of Wintershall Dea’s production, and the company envisages an output of 325 million to 350 million boe in 2023.

Chief Executive Mario Mehren said strategy will now entail focused exploration and selective buying to complement its portfolio.

“Wintershall Dea looks into the future as a resilient and focused company,” he said in a video message.

Growth plans include Algeria and Mexico, with more projects coming in Norway and Argentina, he said.

The company also has ambitions in carbon management and low-carbon hydrogen, having started projects in Denmark, Germany and Norway.

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