Page 15 - EurOil Week 08 2023

EurOil PROJECTS & COMPANIES EurOil

Engie enjoys windfall 2022 profits

on back of high gas, power prices

FRANCE FRANCE’S Engie enjoyed soaring earnings last recurring income of €3.4-4.0bn for this year, and
year on the back of higher gas and power prices, by 2025 it forecasts earnings of €4.1-4.1bn, as it
XXXX prompting it to announce a 65% increase in capitalises on the expansion in its investments
planned dividends. in renewables and the energy solutions business.
Engie was among the number of European Engie separately announced it would broaden
energy firms to profit from higher prices last its energy transition ambitions, projecting €22-
year, despite added costs it incurred as a result 25bn in growth capex in 2023-25, up 50% from
of losing its Russian gas supply last year. Gas the amount it spent in 2021-23. The utility
and power prices have slid back in the last recently disposed of €11bn of assets, leaving it
two months thanks to warm weather, lower with a substantial cash pile.
industrial demand and ample LNG supply, The French firm took a €2.8bn impairment
although Engie predicts them to bounce back hit last year, mainly relating to greater nuclear
as it makes strong returns on its investments provisions for the future dismantling of plants,
in renewables. its planned withdrawal from coal and process
“Not only have we achieved robust opera- for divesting power stations mainly in Chile and
tional and financial results, but we have also pro- Morocco.
gressed on our strategic roadmap, establishing
strong foundations for our group to continue the Gazprom case
implementation of the energy transition,” CEO In its report, Engie also revealed it had initiat-
Catherine MacGregor said on February 22. ed an arbitration case against Russia’s Gazprom
Engie’s net recurring income rose to €5.2bn over the failure to receive contractual gas deliv-
($5.55bn) in 2022, up from €2.9bn a year earlier, eries. The case was launched in the fourth quar-
the company reported, with the release of the ter of last year, Engie said. The company said
results prompting a 5.8% rally in its share price it wanted “recognition of Gazprom Export’s
when the market opened in Paris, to its highest non-performance of its gas delivery obligations
level in three months. towards Engie under long-term gas delivery
Engie’s soaring profits come as Europe strug- agreements and payment of contractual penal-
gles with a deepening cost-of-living crisis, with ties as well as compensation for damages result-
the increasing discontent of voters leading gov- ing from this non-performance.”
ernments to slap windfall taxes on energy firms’ Engie started suffering shortages in Russian
profits to provide households and businesses supply last June, in connection with Gazprom
with relief. These levies, the largest of which restricting capacity via the Nord Stream 1 pipe-
were in Belgium and Italy, led to Engie taking line. The Russian supplier then cut off Engie alto-
an additional tax hit of nearly €900mn, Existing gether at the start of September.
government income-sharing mechanisms in Several other European energy utilities have
those two countries wiped a further €1.1bn off taken Gazprom to court over the last year for fail-
Engie’s profit. ure to deliver gas, including Germany’s Uniper
Looking forward, Engie predicts a net and RWE. ™

Week 08 23•February•2023 www. NEWSBASE .com P15