TotalEnergies reports further loss of $3.1 billion for Russian-linked assets

French oil giant TotalEnergies posted a new $3.1 billion accounting charge tied to its Russian assets, bringing its total Russian-related losses to nearly $11 billion this year, among the highest of Western companies.

At first, the Paris-based company was defiant in maintaining commercial ties in Russia, in contrast to rivals such as BP, Shell and Exxon Mobil, which quickly planned their exits after Moscow’s invasion of Ukraine in February.

After the war broke out, companies ranging from retailers to automakers to fast-food restaurant operators weighed the financial and reputational risks of staying where they were, as the West increasingly sought to insulate Russia from financial and commercial networks. global.

While many left, from the start TotalEnergies defended its decisions to hold on to big investments in Russian oil and gas fields, joining other French companies that were slow to back down.

More recently, TotalEnergies said its strategy is to gradually suspend its activities in Russia that do not directly contribute to the security of energy supply in Europe, while not cutting all connections with the country.

Chief Executive Patrick Pouyanné repeated last month that the company will comply with existing Russian natural gas contracts as long as the activities do not violate European sanctions.

In August, the company sold its 49% stake in a joint venture that operates the Termokarstovoye gas field to its Russian partner PAO Novatek, amid questions from some French politicians and non-governmental investigators over whether the project’s fuel had helped the forces. russians. TotalEnergies says it did not produce jet fuel for the Russian military.

While TotalEnergies’ decision to maintain business in Russia comes at a cost, the company is among the biggest beneficiaries of higher oil and gas prices that were partly spurred by the war in Ukraine.

This Thursday (27), the company reported adjusted net income of US$ 9.9 billion in the third quarter, more than double the result of the same period last year. That continued a string of record profits for the company which, like other major energy producers, faced political heat at home and abroad for the windfall.