Wintershall to write off Nord Stream 2 financing, will cease additional projects in Russia

March 2, 2022
Wintershall Dea will not advance or implement any additional gas and oil production projects in Russia and will write off its financing of Nord Stream 2 totaling around 1 billion euros, in response to the war in Ukraine.

Germany's Wintershall Dea will not advance or implement any additional gas and oil production projects in Russia and will write off its financing of Nord Stream 2 totaling around 1 billion euros, in response to the war in Ukraine.

In April 2017, Nord Stream 2 AG signed the financing agreements for the Nord Stream 2 gas pipeline project with ENGIE, OMV, Royal Dutch Shell, Uniper, and Wintershall for long-term financing of 50% of the total cost of the project. The viability of the pipeline, and the operating company, are now in question. Germany has stopped certification of the 55-billion cu m/year natural gas pipeline, the US has reimposed sanctions, and Swiss-based Nord Stream 2 AG has dismissed the company’s employees (OGJ Online, Feb. 22, 2022; Mar. 2, 2022).

Payments to Russia have ceased, Wintershall said.

Operations

The company remains active in GASCADE Gastransport GmbH. GASCADE operates a 3,200-km gas pipeline network in Germany. The European infrastructure is connected to the major European transit lines from Russia and the North Sea.

It also remains involved in the existing Yuzhno Russkoye and Achimov natural gas production projects in Siberia. The projects produce natural gas for European energy supply, the company said.

Yuzhno-Russkoye field was discovered in 1969 and is one of the largest in Russia. The Severneftegazprom joint venture started to operate the field in 2007 and has been producing around 25 billion cu m/year of natural gas at plateau level since 2009. Wintershall holds a 35% interest in the economic success of the field, with Gazprom as the lead project partner. Natural gas is produced from the reservoir’s Cenomanian layer. To extend the life cycle of the field and secure the production plateau for several years, Severneftegazprom is developing the Turonian deposits. The first Turonian well clusters of the full field development came on stream in 2020 and work is ongoing (OGJ Online, Jan. 20, 2022).

The Achim development joint venture was founded for the further field development of the Achimov formations. The joint venture with Gazprom, in which Wintershall Dea has a 25.01% stake, is developing Area 4A/5A of Urengoyskoye field. The first development phase started in 2018. In early 2021, Achim development started commissioning of Area 4A/5A and produced first gas and gas condensate from the license block.