Operating result RWE DEA

At €494 million, the operating result achieved by RWE Dea was roughly equal to the year-earlier level. The division therefore lagged our expectations. The forecast we published in February 2008 envisaged an increase of more than 10 %. The considerable deviation is due to a significant step-up in the exploration for new gas and oil fields. Although we maintained a high success rate, this increased the number of exploratory wells which were unsuccessful. Expenses associated with such dry wells cannot be capitalized and therefore have an immediate impact on the income statement. Nevertheless, RWE Dea maintained the level of earnings achieved in 2007, mainly because oil and gas prices were higher. The effect would have been bigger if the US dollar and Sterling had not lost value. The decline in oil production and higher production fees also had an earnings-reducing effect.