Wintershall DEA writes off €1bn of Nord Stream 2 funding

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Wintershall DEA has said it will not “advance or implement” any oil and gas projects in Russia and will cancel its €1bn (£830m) funding for Nord Stream 2.

Following a meeting today, the company’s board said it would not pursue any additional gas and oil production projects in Russia and would cease all planning for new projects.

It would also see the company “essentially halt payments to Russia with immediate effect,” its statement added.

Five energy companies – Shell, OMV, Engie, Uniper and Wintershall DEA – have each pledged to provide financing and guarantees for the total estimated €9.5 billion cost of the 55 billion cubic meter Nord Stream 2 gas pipeline per year, alongside Gazprom, which bears half of the costs.

OMV said yesterday it was reviewing its involvement, while Shell said it would end its interest in the project.

Reports emerged yesterday from Reuters that the Swiss-based company that built and operates the pipeline had filed for bankruptcy following the sanctions, citing sources close to the situation.

The US Treasury Department’s Office of Foreign Assets Control issued an executive order last month authorizing “the liquidation of transactions involving Nord Stream 2 AG” or “any entity in which Nord Stream 2 AG holds, directly or indirectly, a 50% or more”. by March 2.

In a statement posted on its website, Nord Stream 2 AG said: “We cannot confirm media reports that Nord Stream 2 has filed for bankruptcy. The company only informed local authorities that it had to terminate contracts with employees following recent geopolitical developments that led to the imposition of US sanctions against the company.

The company added that it had taken down the rest of its website “due to serious and continuing attacks from outside”.

Yuzhno Russkoye and Achimov

However, Wintershall DEA said it “remains involved” in the Yuzhno Russkoye and Achimov natural gas projects in Siberia, which it says “produce natural gas for European energy supply.”

It holds a 35% stake in the former project, via the Severneftegazprom joint venture with Gazprom.

It also holds a 50% stake in the Achimgaz project on the Urengoyskoye field alongside Gazprom’s subsidiary Gazprom Dobycha Urengoy, and a 25.01% stake in a new development in Area 4A/5A of the same field, also with Gazprom.

It remains active in GASCADE Gastransport, which operates a 3,200 km gas pipeline network in Germany.

The company’s executive committee and board of directors have also published a joint statement alongside the announcement, in which they stated:

“We – the General Works Councils, the Representative Executive Committee and the Board of Directors of Wintershall Dea – condemn the Russian President’s war of aggression in the strongest possible terms. It not only violates international law, but everything we stand for as a company: freedom, the rule of law, democracy and diversity. Values ​​we are unconditionally and uncompromisingly committed to.”

“We have been working in Russia for more than 30 years. Many of our colleagues at our other locations also work daily with Russian partners – at Wintershall Dea or in our joint ventures. Many of our colleagues come from Russia or Ukraine. From Belarus or Central Asian countries. For them – but also for all of us – this war against Ukraine is a blow. We stand with our Ukrainian and Russian colleagues at all Wintershall Dea sites who live and uphold our values ​​of freedom and peace.

“We have established many personal relationships, including in our joint ventures with Gazprom. But the Russian war of aggression against Ukraine marks a turning point. What is happening now is shaking the very foundations of our cooperation.

This follows a similar statement released yesterday by the company’s chief executive, Mario Mehren.

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