TotalEnergies announced that it will face a $2.1 billion financial impact in the fourth quarter of 2022 due to windfall taxes imposed by the EU and the UK. These taxes target the large profits generated by fossil fuel companies after the surge in oil and gas prices following Russia’s invasion of Ukraine. The EU tax will cost the company $1.1 billion, while the UK's 25% windfall tax will add another $1 billion to this burden.
Despite these challenges, TotalEnergies expects its cash flow from its liquefied natural gas (LNG) business and gas trading activities to increase in the final quarter of 2022 compared to the previous one, even though gas prices have decreased. The company also disclosed that it will take a larger-than-expected impairment charge of $4 billion related to its 19.4% stake in Russian company Novatek, reflecting its decision to stop accounting for this stake from the end of 2022.
In total, TotalEnergies will have booked $14.7 billion in impairments on its Russian assets by the end of 2022, which remains lower than BP's $25.5 billion charge. Additionally, TotalEnergies carried out $2 billion in share buybacks during the fourth quarter and plans to maintain this level in the first quarter of 2023.
