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Uniper and Shell will withdraw from Russia

The German energy group Uniper has decided to sever ties with Russia. Indeed, the company will record a full impairment loss on its loan to Nord Stream 2 in the amount of €987m. Uniper will also resume the divestment process for Russian subsidiary Unipro (83.73% owned), which owns and operates 5 thermal power plants with a total capacity 11.4 GW at the end of 2021. Uniper, which has a portfolio of around 370 TWh of long-term gas supply contracts, including 200 TWh with Russia, will continue to supply Russian gas to Europe under the existing contracts, but will not enter into new long-term gas supply contracts with Russia. The group will gradually shift from natural gas to CO2-low or -free gases, and will diversify its gas portfolio by increasing its LNG portfolio, reviving plans for an LNG terminal in Wilhelmshaven (Germany) where a green ammonia import and hydrogen production hub could be developed. Finally, Uniper will not extend its Russian coal supply contracts that expire at the end of 2022. 

In addition, Shell will withdraw from Russian hydrocarbons, including crude oil, petroleum products, gas and LNG in a phased manner. In a first step, the company will stop all spot purchases of Russian crude oil, removing Russian oil volumes from its crude oil supply chain, and it will shut its service stations, aviation fuels and lubricants operations in Russia. Earlier in March 2022, Shell had pledged to exit its joint ventures with Gazprom and related entities, including its 27.5% stake in the Sakhalin 2 LNG export project and its 50% stake in the Salym Petroleum Development and the Gydan energy venture.