09. July 2021 | 11:27 CET
Nel ASA, Deutsche Rohstoff AG, Royal Dutch Shell - Flexibility pays off
If you believe the media, fossil fuels have no long-term future. The replacement by renewable energies such as wind and water power or photovoltaics seems to be a done deal. Whether the "green turnaround," as planned by politicians, will occur is still written in the stars. The new technologies have too many open construction sites; think of the weak infrastructure for e-charging stations. Until then, demand for fuels such as gasoline and diesel for cars with internal combustion engines is likely to remain at a high level, much to the liking of oil producers.
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ISIN: NEL ASA NK-_20 | NO0010081235 , DT.ROHSTOFF AG NA O.N. | DE000A0XYG76 , ROYAL DUTCH SHELL A EO-07 | GB00B03MLX29
"[...] The Oxbow Asset now delivers a substantial free cash flow stream to internally fund our impactful drilling and workover programs. [...]" John Jeffrey, CEO, Saturn Oil + Gas Inc.
Deutsche Rohstoff AG - Strong performance
The pumps are running at full speed, and profits are gushing more than expected. Deutsche Rohstoff AG shone last year during the oil crash due to the outbreak of the Corona pandemic with its flexible investment policy, which continues to pay off in cash. When the preliminary figures were announced, the Mannheim-based Company reported a consolidated net profit of EUR 17.5 million. Sales amounted to EUR 38.3 million, EBITDA was EUR 39.9 million, compared to EUR 15.8 million in the same period of the previous year.
As a result of the first half-year being far above the plan, the forecasts for sales and EBITDA for the full years 2021 and 2022 have been revised significantly upwards. The team around CEO Dr. Thomas Gutschlag had initially planned a sales range between EUR 57 million and EUR 62 million. Now they are aiming for revenues of between EUR 68 million and EUR 73 million, and in 2022 it could even be as high as EUR 75 million. On the EBITDA side, between EUR 42 million and EUR 47 million were planned, now Deutsche Rohstoff AG is aiming for EUR 57 million to EUR 62 million. In 2022, it could be up to EUR 52 million in the best-case scenario.
The Company's main focus, oil and gas production in the US, was already running at 1,210,000 BOE at the end of May, about 16% above forecasts. At the Knight well site, everything is going according to plan so that the deadline to start production in the fourth quarter remains in place. In addition, the securities portfolio, which was significantly expanded with oil and gas and gold stocks at the time of the Corona Crash, continues to deliver positive returns. In the months from April to June alone, gains of EUR 3.0 million were realized here, with EUR 6.4 million remaining on the unrealized profit side.
In addition to the securities portfolio, there is another "hidden reserve" in fixed assets. Deutsche Rohstoff holds a 12.8% stake in Almonty Industries. The Company is building the world's largest tungsten mine in South Korea and is responsible for 50% of the world's tungsten supply outside China at full production. The groundbreaking ceremony was held at the end of May, and the financial closing is expected soon. An off-take agreement for tungsten concentrates has been concluded with the Austrian Plansee Group for 15 years.
In recent months, the management of Deutsche Rohstoff AG has demonstrated both its many years of expertise and its flexibility in making trading decisions. With a bulging treasury - the sum of cash, short-term receivables and securities held as fixed and current assets rose to around EUR 70 million at the end of May - further acquisition targets are now being identified. The investment focus here is likely to be on critical metals related to the booming topic of electromobility, such as copper and lithium. Deutsche Rohstoff AG's journey is not over yet!
Royal Dutch Shell - Transformation underway
At the latest, the court order from The Hague is forcing Europe's largest oil company to rethink. According to the court, Shell is required to halve its greenhouse gas emissions by 2030. Before the ruling, the British-Dutch oil giant planned to focus its future on sustainable electricity, biofuels and hydrogen. It has become known that Shell wants to cooperate more closely with Uniper in producing and using hydrogen.
One of the key points here is to create the necessary infrastructure for the large-volume transport of hydrogen from Rotterdam and Wilhelmshaven to North Rhine-Westphalia (NRW). The core of the cooperation is also to be the former Rhineland refinery. Shell is transforming this into a chemical and energy park. A 10 MW PEM electrolyzer for the production of green hydrogen, was already started up there last week. The capacity is to be expanded to 100 MW with the help of partners.
Nel ASA - Important mark
After breaking out of the sideways trend at EUR 1.80, which has been running for months, the shares of the Norwegian hydrogen specialist Nel ASA prepared to leave the EUR 2 mark behind and break through the critical 200-day line. However, this attempt failed miserably on the first try. Falling below the now strong support at EUR 1.80 would mean another test of the annual low in the area around EUR 1.60. A buy signal would be given again when the price breaks above the EUR 2 mark.
Even though the future undoubtedly belongs to renewable energies, the demand for fossil fuels such as oil and gas will still be present for a long time. Like Deutsche Rohstoff AG, those companies who can react flexibly will be among the winners. Oil giants are facing a massive transformation, the destination of which is not yet foreseeable.