How A German Gas Giant’s Investments May Be Fueling Russia’s Military, Including In Ukraine – Analysis
By RFE RL
By Mark Krutov and Sergei Dobrynin
(RFE/RL) — Siberian hydrocarbon fields co-owned by German oil and gas giant Wintershall and Russia’s Gazprom have been linked to fuel supplies used by Russian military and intelligence units, including some believed to be fighting in Ukraine, a new investigation has found.
The findings, by RFE/RL and the British anti-corruption group Global Witness, raise new questions about Wintershall’s continued investments and business dealings in Russia amid sweeping Western sanctions imposed after Russia’s full-scale invasion of Ukraine in February 2022.
Rail freight data provided to Global Witness by the Anti-Corruption Data Collective, a European research organization, showed that gas condensate sourced from Wintershall’s fields in western Siberia continues to be shipped to a refinery in Salavat, in the central Russian region of Bashkortostan.
That refinery supplies diesel fuel to several Russian military and security agencies, including the Federal Protection Service (FSO), which is responsible for President Vladimir Putin’s personal security, among other roles.
The western Siberia fields are owned by a joint venture between Wintershall, which is majority-owned by German industrial conglomerate BASF, and Russian state-owned natural gas giant Gazprom. The fields are part of a geological formation known as the Achimov deposits, where substantial amounts of gas condensate have been identified.
The data and other evidence reviewed by RFE/RL and Global Witness are not detailed enough to prove conclusively whether any given barrel of diesel from the Salavat refinery contains product refined from gas condensate extracted by Wintershall’s joint venture. But recipients of Salavat refined diesel include a unit of the FSO.
But recipients of Salavat refined diesel include a unit of the FSO and, evidence suggests, a unit of the National Guard that has had at least one member killed in Ukraine.
Last November, Der Spiegel reported that Wintershall’s gas condensate may have been used to produce fuel for Russian Air Force jets. The company denied the allegations and accused the media of failing to provide “concrete” evidence of the connection between its products and the Russian military.
Wintershall has said it no longer has control of its Russian joint ventures and its shared bank accounts with Gazprom. Company executives have debated how to compensate shareholders, and the company is considering applying for compensation from the German government.
Asked to comment on the findings, a Wintershall official told Global Witness that it was not involved in any hydrocarbon transport and marketing in Russia and that there was “no proof that condensate from the Achimov formation has been used to produce fuels for the Russian military for the war of aggression” in Ukraine.
But the invasion itself, now in its 15th month, may also be making it harder for Wintershall itself to assess where its hydrocarbon supplies are going. The Kremlin has expanded the number of military and intelligence agencies that are exempt from public procurement disclosures. The list includes the FSO.
Supply Chain To Salavat
For years, Wintershall has had multiple joint ventures in Russia, two of which are with Gazprom and its subsidiary, Gazprom Dobycha Urengoi.
In January 2023, 11 months after the full-scale invasion of Ukraine began, Wintershall said that Russian government interference meant its assets in the country had been “economically expropriated,” and that it would exit Russia.
The company’s annual report published a month later, however, reported continued ownership of 50 percent and 25 percent of shares in the two joint ventures with Gazprom: Achimgaz and Achim Development. Russian corporate records also showed continued ownership.
The Achimov deposits produce a significant portion of gas condensate handled by a processing plant in the nearby city of Novy Urengoi. That plant is controlled by a different Gazprom unit.
Once processed, the gas condensate is distributed for refining. In 2022, according to railway data, 66 percent of gas condensate leaving Surgut went to a station used by a refinery in Salavat, operated by another Gazprom subsidiary, Gazprom Neftekhim Salavat.
Located in the central Russian region of Bashkortostan, the Salavat refinery, whose final products include diesel fuel, is supplied overwhelmingly by gas condensate, according to company statements.
Sprawling Supply Chains, Military-Linked Customers
Just months before the full-scale invasion of Ukraine, the Russian military approved various Salavat diesel products for military use. Around the same time, rail deliveries of fuel from a station next to Salavat to regions bordering Ukraine increased markedly.
Shipments to Russian regions bordering Ukraine remain consistent throughout the invasion, then spiked again in late 2022, according to the railway data.
An analysis of Russian government procurement records, conducted by Global Witness and RFE/RL, showed that in 2022, the Salavat refinery sent diesel directly to companies with a history of military and other contracts.
One firm that received multiple deliveries of diesel from Salavat between April and October 2022 is called Kedr. The company has signed several contracts with the Russian military since 2021, agreeing to deals to supply gasoline and diesel to military units known as 38953-K and 69793.
Unit 69793 is part of the FSO. The agency says officers from those two units operate in Sochi, the Black Sea resort city where the Russian presidential residence is located and where Putin spends a significant amount of time.
Based in Crimea, the Ukrainian peninsula occupied by Russia since 2014, Kedr operates a network of fueling stations there under the brand name ATAN, according to Russian media reports.
Last month, Kedr, which employs at least one local lawmaker from the ruling United Russia political party, signed a contract to supply gasoline to a former paramilitary group that provides support to the Russian police on the occupied peninsula.
More evidence pointing to Wintershall’s gas condensate supplies making their way to Russian military units can be found the southern Russian region of Stavropol, where the Russia’s 49th Combined Arms Army is based.
Wholesale fuel dealer Agro-Snab signed several contracts to store oil products such as diesel for military unit 2432 in Stavropol between 2014 and 2017. Rail freight data reviewed by Global Witness and RFE/RL showed that Agro-Snab received several shipments of diesel from Salavat in 2022, as well as received over 550 tons of diesel from the plant in January 2023.
In 2015, a second wholesale fuel company, Promkhim, signed contracts to rent out its diesel storage tanks to military unit 5559, which is part of the Russia’s National Guard, also known as Rosgvardia. Promkhim received several shipments of diesel from Salavat in June 2022, four months after the invasion began. It is unclear whether the contracts remained in place at that time.
At least one member of unit 5559 has been killed in Ukraine, according to a casualty database maintained by the Russian-language news site Mediazona.
Compensation For Wintershall?
In February, Wintershall’s chief financial officer was quoted by the Financial Times as saying that the company once hoped cash from its Russian operations would be “dividend-ed back” to shareholders after the war concluded. In the same article, Chief Executive Mario Mehren declined to comment on whether they would sell their Russian businesses.
Wintershall executives have also considered seeking compensation for its losses in its Russian ventures by turning to German government guarantees. If paid out, those guarantees would be effectively funded by German taxpayers.
Written by Mike Eckel based on reporting by RFE/RL Russian Service correspondents Mark Krutov and Sergei Dobrynin and Global Witness researchers.
- Mark Krutov is a correspondent for RFE/RL’s Russian Service and one of the leading investigative journalists in Russia. He has been instrumental in the production of dozens of in-depth reports, exposing corruption among Russia’s political elite and revealing the murky operations behind Kremlin-led secret services. Krutov joined RFE/RL in 2003 and has extensive experience as both a correspondent and a TV host.
- Sergei Dobrynin is one of the leading investigative journalists in Russia. He has been instrumental in the production of dozens of in-depth reports, exposing corruption among Russia’s political elite and revealing the murky operations behind Kremlin-led secret services. He joined RFE/RL in 2012.