Oil and gas company Wintershall DA announced it was pulling out of Russia a week ago, with Gazprom taking control of three of its joint ventures, CEO Mario Meiner said. It is reported by the Financial Times. Mainer also accused the former partner of emptying the joint bank accounts of these joint ventures.
As a result, the German company suffered losses of around 2 billion euros ($2.18 billion), Meiner told Börsen-Zeitung newspaper. Gazprom did not respond to a request for comment, the FT notes.
Wintershall DEA is Europe’s largest non-public oil and gas company, owned by the German petrochemical concern BASF (67% shares) and the British LetterOne (33%), founded by Alfa Group Mikhail Fridman, owners of German mines and was done. Alexey Kuzmyshev. Wintershall was one of five investors involved in the construction of Nord Stream 2. On February 24, 2022, after the German government halted certification of the pipeline, the company said it expected €730 million in compensation.
After the start of the war in Ukraine, Wintershall DA, unlike the vast majority of Western companies, continued to operate in Russia. He announced his departure on 17 January itself, saying that his joint ventures were subject to “economic eviction”. The reason for the withdrawal was the actions of the Russian authorities, the company said: “In recent months, due to restrictions imposed by the Russian government on the work of Western companies in the country, and outside interference in the activities of our joint ventures, work in Russia for Wintershall DA made it impossible to continue doing.”
Previously, following a decree by Vladimir Putin, the government had capped gas prices above which Gazprom could not buy it from joint ventures with Wintershall.
A few days before the Russian invasion of Ukraine, Menner advocated developing closer ties with Russia. Now the company says:
The war of conquest that Russia is waging in Ukraine is inconsistent with our values and has destroyed cooperation between Russia and Europe.
As a result of leaving Russia, Wintershall will write off 5.3 billion euros. Its main shareholder BASF said the decision would cost them 7.3 billion euros, with losses of 1.4 billion euros by the end of 2022.
Wintershall has been criticized in the German media and by some politicians for continuing to operate in Russia after the outbreak of war, claiming that condensate supplied to Gazprom could be used in the production of fuel for military aircraft. Could However, analysts note that the decision to leave the company was indeed difficult. Martin Fuzeric, an analyst at Moody’s ratings agency, told the FT that its business depends on Russia to a greater extent than other Western companies.
Still, Fuzerich believes the company will survive the loss of the Russian business: “Even without cash in Russia, it maintains a very strong capital structure.”