Page 9 - EurOil Week 08 2021

EurOil PERFORMANCE EurOil

Wintershall Dea suffers widened

2020 losses but boosts output

GERMANY GERMAN gas group Wintershall Dea suf- in 2019, while yields in Middle East and North
fered broader losses in 2020 as the coronavi- Africa dipped to 48,000 boepd from 51,000
The bright spot rus (COVID-19) pandemic weighed down on boepd and Latin American output slipped to
was Wintershall demand. But the firm ended the year with record 74,000 boepd from 76,000 boepd.
Dea’s production production, on the back of increased contribu- CEO Mario Mehren emphasised Wintershall
performance. tions from Russia and Northern Europe. Dea’s success in reaching these targets in what
Wintershall Dea’s EBITDAX slumped 41% was a very turbulent year for the industry.
last year to €1.64bn ($2bn) as a result of weaker “Looking ahead, 2021 will certainly be a year
prices, partially offset by lower operating and with continued high levels of uncertainty as well
administrative expenses. Its adjusted net income as volatility, and while we remain cautious, we
came in at €195mn, versus €512mn a year earlier, look forward to an exciting year.”
owing to increased financial expenses and fur-
ther depreciation and amortisation losses. Gjoa start-up
Wintershall Dea’s fourth-quarter perfor- Wintershall Dea has a 28% position in the
mance was stronger, with EBITDAX arriv- Neptune Energy-operated Gjoa field in the
ing at €500mn, down 23% year on year but up Norwegian North Sea, where the production
25% quarter on quarter. Adjusted net income from the P1 redevelopment project kicked off
also surged 80% y/y to €128mn in the three- this week.
month period, while free cash flow (FCF) grew Gjoa has been in flow since 2010, producing
to €278mn, marking a reversal from negative 2.34bn cubic metres of gas and 28,800 barrels per
€248mn in Q4 2019. day (bpd) of liquids last year. P1 involves adding
Net debt dropped 4% y/y to €5.52bn in the a new subsea template that will host one oil and
fourth quarter, but Wintershall Dea’s leverage one gas well, designed to exploit deeper-lying
grew to 3.4 from 2.1, and production costs crept reservoirs. Gas flow commenced on February
up 19% to €3.7/barrel of oil equivalent (boe). 22 and oil extraction should follow shortly, the
The company’s capital expenditure in the three project partners reported in a statement.
months amounted to €295mn, down 31% versus “Despite the challenges of the pandemic, we
a year earlier. delivered the project on time and on budget,”
Neptune’s managing director in Norway, Odin
Operations Estensen, commented. “The start-up of Gjoa
The bright spot in Wintershall Dea’s results was P1 underlines the Gjoa platform’s position as an
its production performance. Its output in 2020 important hub, increasing total remaining devel-
averaged 623,000 barrels of oil equivalent per oped reserves at Gjoa by 30%.”
day, up from 617,000 boepd in the previous Thanks to its redevelopment, Gjoa is expected
year. The volume included 446,000 boepd of gas to produce 100mn boe more than it originally
and 177,000 boepd of liquids. Production in the anticipated. Neptune will bring online another
fourth quarter was a record 654,000 boepd. field in the area Duva, which will be tied back
Wintershall Dea’s operations in Russia to Gjoa’s facilities, later this year. Okea, another
accounted for 295,000 boepd of its supply, up project partner, is weighing up other tieback
from 289,000 boepd in the year before. The com- options, including the nearby Aurora gas discov-
pany can expect further growth after launching ery in which it bought a 40% stake from Equinor
the 4A deep gas project in Western Siberia with last year.
its partner Gazprom in January. Neptune has a 30% position at Gjoa, while
Production in Northern Europe averaged Petoro also has 30%, Wintershall Dea 28% and
206,000 boepd in 2020, versus 201,000 boepd Okea 12%. ™

Week 08 25•February•2021 www. NEWSBASE .com P9