15 – Property, plant and equipment

Development of property, plant and equipment 2014 (in million €)

 

 

Land, land rights and buildings

Machinery and technical equipment

Miscellaneous equipment and fixtures

Construction in progress

Total

Cost

 

 

 

 

 

 

Balance as of January 1, 2014

 

8,735

39,697

3,295

5,463

57,190

Changes in scope of consolidation

 

1

11

3

15

Additions

 

355

1,280

240

3,493

5,368

Additions from acquisitions

 

424

577

1,001

Disposals

 

(109)

(1,063)

(141)

(173)

(1,486)

Transfers

 

320

1,517

176

(2,003)

10

Exchange differences

 

333

1,544

115

324

2,316

Balance as of December 31, 2014

 

9,635

43,410

3,688

7,681

64,414

Accumulated depreciation

 

 

 

 

 

 

Balance as of January 1, 2014

 

5,091

30,112

2,558

200

37,961

Changes in scope of consolidation

 

2

8

2

12

Additions

 

261

2,176

229

104

2,770

Disposals

 

(93)

(939)

(136)

(22)

(1,190)

Transfers

 

(38)

42

4

8

Exchange differences

 

130

1,144

79

4

1,357

Balance as of December 31, 2014

 

5,391

32,463

2,774

290

40,918

Net carrying amount as of December 31, 2014

 

4,244

10,947

914

7,391

23,496

Additions to property, plant and equipment from investment projects in 2014 amounted to €5,368 million. Significant investments were particularly related to the construction of a TDI plant in Ludwigshafen, Germany; a production complex for acrylic acid and superabsorbents in Camaçari, Brazil; an MDI plant in Chongqing, China; and oil and gas production facilities and wells in Europe and South America. Investments for expansion purposes were particularly made at the sites in Ludwigshafen, Germany; Antwerp, Belgium; Geismar, Louisiana; and Freeport, Texas. Property, plant and equipment rose by €1,001 million primarily from the acquisitions of the assets from Statoil ASA, Stavanger, Norway.

In 2014, the impairments of €298 million recognized under accumulated depreciation primarily concerned the Oil & Gas segment. They mainly arose from the complete write-down of property, plant and equipment due to projects for the development of a gas field in Qatar in the amount of €81 million as well as an oilfield in the United Kingdom in the amount of €44 million. Furthermore, write-downs relating to oil and gas fields in Norway and Germany of €94 million were recognized. The oil and gas fields were written down to their recoverable value amounting to €554 million. The recoverable values for the the individual oil and gas fields were calculated using a weighted average cost of capital rate before taxes, which ranged between 8.46% and 73,56%. The high capital cost rates are due to the separate income tax for the oil and gas industry in Norway. A plant in the Chemicals segment was written down to its recoverable amount of €31 million, requiring the recognition of an impairment in the amount of €27 million. The weighted average cost of capital rate before taxes used was 9.38%. The recoverable amount for impairments was determined using the value in use.

Disposals of property, plant and equipment were largely attributable to the sale of selected oil and gas investments in the North Sea to the Hungarian MOL Group.

In 2014, transfers included a write-up of €3 million.

Development of property, plant and equipment 2013 (in million €)

 

 

Land, land rights and buildings

Machinery and technical equipment

Miscellaneous equipment and fixtures

Construction in progress

Total

Cost

 

 

 

 

 

 

Balance as of January 1, 2013

 

8,730

40,924

3,254

3,619

56,527

Changes in scope of consolidation

 

1

1

2

Additions

 

221

954

194

3,548

4,917

Additions from acquisitions

 

75

1,426

4

6

1,511

Disposals

 

(187)

(779)

(157)

(151)

(1,274)

Transfers

 

122

(2,179)

54

(1,430)

(3,433)

Exchange differences

 

(226)

(650)

(55)

(129)

(1,060)

Balance as of December 31, 2013

 

8,735

39,697

3,295

5,463

57,190

Accumulated depreciation

 

 

 

 

 

 

Balance as of January 1, 2013

 

5,081

31,208

2,567

164

39,020

Changes in scope of consolidation

 

1

1

Additions

 

278

2,081

208

64

2,631

Disposals

 

(144)

(755)

(138)

(23)

(1,060)

Transfers

 

(26)

(1,947)

(38)

(5)

(2,016)

Exchange differences

 

(98)

(475)

(42)

(615)

Balance as of December 31, 2013

 

5,091

30,112

2,558

200

37,961

Net carrying amount as of December 31, 2013

 

3,644

9,585

737

5,263

19,229

Additions to property, plant and equipment from investment projects in 2013 amounted to €4,917 million. Significant investments were particularly related to the construction of a TDI plant in Ludwigshafen, Germany; an MDI plant in Chongqing, China; a production complex for acrylic acid and superabsorbents in Camaçari, Brazil; and oil and gas production facilities and wells in Europe. Investments for expansion purposes were particularly made at the sites in Ludwigshafen, Germany; Antwerp, Belgium; Geismar, Louisiana; and Port Arthur, Texas. Property, plant and equipment rose by €1,511 million on account of acquisitions; €1,204 million came from the acquisition of assets from Statoil ASA, Stavanger, Norway, and €288 million from the acquisition of Pronova BioPharma ASA, Lysaker, Norway.

Impairments of €213 million under accumulated depreciation in 2013 resulted mostly from a fully impaired plant in the Chemicals segment, as well as from a gas field development project in the Oil & Gas segment that was impaired based on a recoverable amount of €82 million. The recoverable amount for both impairments was determined using the value in use.

Transfers of property, plant and equipment amounting to €1,382 million, mainly machinery and technical equipment, concerned the Oil & Gas segment. This was due to the reclassification of GASCADE Gastransport GmbH, Kassel, Germany, from a fully consolidated company to a company accounted for using the equity method, as well as to the transfer of assets from a fully consolidated company to a company accounted for using the equity method.

In 2013, transfers included a write-up of €1 million.