The gas and oil producer Wintershall Dea increased its gross profit to almost 2.6 billion euros in the third quarter thanks to the sharp rise in gas prices.

This means an increase of 160 percent compared to the previous year.

However, the "bloody profits" that the German Environmental Aid spoke about on Tuesday are not arriving at Wintershall.

Even more: the group is desperately looking for an exit from Russia.

Bernd Freytag

Business correspondent Rhein-Neckar-Saar based in Mainz.

  • Follow I follow

In the meantime, 2 billion euros are blocked in Russian accounts - money that Wintershall cannot get out of the country and that is increasing every day, as CFO Paul Smith said when presenting the quarterly balance sheet.

If you believe the Wintershall board, he would rather divest himself of his activities in Russia sooner rather than later.

According to him, however, this is extremely difficult: According to CEO Mario Mehren, the sale of the Russian production licenses would have to be approved by the Russian government.

But that is not to be expected.

That is why there are currently no negotiations with the state, nor talks with other companies that may be interested.

BASF tries deal with Mikhail Fridman

In order to get out of Russia, majority owner BASF is apparently looking for a deal with the second major shareholder, the Russian-born oligarch Mikhail Fridman.

He could get the production activities in Russia in return for selling his Wintershall shares to BASF.

Such a “Russia-free” Wintershall could then still be listed on the stock exchange as planned.

However, it is not clear whether the pugnacious Russian investor, given his strengthened position, will agree to it and how much he would be willing to pay.

Mehren only confirmed that the group is strategically repositioning itself and is also examining separating the international business from the Russian business.

A solution, if it were to come about, would be a matter of months, he says.

Wintershall stopped all investments after the invasion of Ukraine, but says it is fulfilling its contractual obligations.

According to Mehren, a withdrawal would only mean that production licenses in Siberia, worth billions, would fall to the Russian state without anything in return.

However, critics of the German Environmental Aid complain that the company used its taxes to finance Putin's power apparatus and thus the war.

In fact, Wintershall Dea produces gas in Russia on its own account, but is obliged to sell it locally to the gas monopoly Gazprom.

According to the company, it has no influence on whether and when gas will flow through the destroyed Nord Stream I pipeline again, even though the group is a co-owner.

Wintershall has written off the pro rata value of the tube by 175 million euros, it still stands at 300 million euros.

The group has already written off the financing for the second tube, Nord Stream II.

Balance sheet with and without business in Russia

Mehren said that Wintershall would not be able to make any statements as to how and whether the pipeline would continue until the government investigations into the sabotage of the pipes were completed.

CFO Smith also indirectly warned of further threats to the production facilities, this time in Norway.

According to him, drones are increasingly being seen above the platforms.

Government agencies and operators are equally alarmed, and the threats are taken very seriously.

Measured in terms of production volume, Russia accounted for half in the third quarter, but “only” a quarter in terms of gross profit.

Smith justified the difference by saying that Russian pipeline gas is mostly sold through long-term contracts.

The high spot market prices would therefore be less noticeable.

The group can sell the Norwegian gas at a higher price, but it also pays a lot more taxes for it.

Since the attack on Ukraine, Wintershall has reported the balance sheet with and without business in Russia.

After nine months, the Ebitdax gross profit – roughly sales minus production costs – has risen from 2.3 billion euros to 6.2 billion euros with slightly increased production volumes.

Without Russia, 4.7 billion euros would have remained.

However, the impairments on the Russian activities and not least the significant increase in tax payments in Norway have made up for most of the increase on the bottom line.

The surplus rose by a comparatively small 40 million to 475 million euros year-on-year.