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The latest developments in Russia’s war on Ukraine. All times EST.
1:30 a.m.: Chemicals giant BASF unveiled a 7.3 billion euro ($7.9 billion) non-cash impairment on Wintershall Dea, after the oil and gas exploration joint venture decided to exit Russia following its invasion of Ukraine, Reuters reported.
“Wintershall Dea will end its Russian activities. Continuing to operate in Russia is not tenable,” Wintershall Dea Chief Executive Mario Mehren said.
A 72.7%-27.3% joint venture between BASF and Russian billionaire Mikhail Fridman’s investment firm LetterOne, Wintershall Dea is one of Germany’s companies most exposed to Russia and had up until now stopped short of pulling out. “Russia’s war of aggression in Ukraine is incompatible with our values and has destroyed cooperation between Russia and Europe,” Mehren said in a statement late on Tuesday.
BASF’s Frankfurt-listed shares were down 3.7% following the news. A local trader said that investors may now fear a “harsh dividend cut.”
Mehren said limitations the Russian government imposed on local assets owned by Western companies had made it impossible to operate properly “and resulted in an economic expropriation of the joint ventures in Russia.”
Wintershall Dea’s Russian activities include a 35% stake in the Yuzhno-Russkoye gas field, which Gazprom (40%) and Austria’s OMV (25%) co-own. Wintershall Dea also co-owns two Achimov natural gas production projects in Siberia, including Achimgaz — a 50-50 joint venture with Gazprom — and the 25-75 Achim Development venture. Wintershall Dea said its exit from Russia would be in line with local laws and regulation.
It also expects a 5.3 billion euro non-cash loss from the deconsolidation of its Russian joint venture and impairments on Russian-related activities, including its 15.5% stake in the damaged Gazprom-led Nord Stream pipeline and the WIGA Transport joint venture with Sefe, formerly known as Gazprom Germania.
As a result, BASF, which said the Nord Stream stake had been fully written down, flagged a 1.38 billion euro net loss for 2022, according to preliminary results also published on Tuesday, compared with a 5.52 billion profit in 2021. According to the Vara consensus of estimates the company provided, analysts had on average expected net profit of 4.77 billion euros. BASF’s earnings before interest and tax (EBIT) likely declined by 15% in 2022 to 6.55 billion euros, also below the 6.84 billion analyst forecast.
Sales for the past year were up 11% at 87.32 billion euros, BASF, which is scheduled to release its annual 2022 results on February 24, citing higher prices and currency effects.
1:05 a.m.:
12:30 a.m.: The training of Ukrainian officers to operate the Patriot advanced long-range air defense system will last 10 weeks, Reuters reported citing Ukraine’s Defense Minister Oleksii Reznikov.
The United States, Germany and the Netherlands have pledged to send Patriot missile systems to Ukraine to repel a barrage of Russian missile and drone attacks.
“There is a decision that our officers will be trained in 10 weeks. Such obligations were undertaken by the American partners,” Reznikov said, in remarks published Tuesday on Ukraine’s state Military Media Center Telegram messaging app.
12:01 a.m.: Ukraine has taken a step closer to winning approval for German-made modern battle tanks to confront invading Russian forces and has secured a pledge of more Patriot defense missiles as its allies appear ready to rally for the next phase of the war.
Ukraine has relied primarily on Soviet-era T-72 tank variants, Reuters reported. Germany’s Leopard 2 tank, operated by armies in about 20 countries, is regarded as one of the West’s best. The tank weighs more than 60 tons, has a 120-millimeter smoothbore gun and can hit targets at a distance of up to five kilometers.
Ukraine says the tanks would give its troops the mobile firepower to drive Russian troops out in decisive battles. Germany has been the West’s biggest holdout on pledging tanks, but a cabinet minister said on Tuesday the issue would be the first to be decided by new defense minister Boris Pistorius.
He will host U.S. Defense Secretary Lloyd Austin on Thursday ahead of a meeting on Friday of dozens of defense ministers at Ramstein air base in Germany.
Western countries have provided a steady supply of weapons to Ukraine since Russia invaded last February 24 in what it calls a “special military operation” to protect its security because its neighbor grew increasingly close to the West.
Ukraine and its allies accuse Moscow of an unprovoked war to grab territory and to erase the independence of a fellow ex-Soviet republic.
Some information in this report came from Reuters.
