Strategic Cornerstones – OMV set to become bigger and more valuable

The OMV Strategy 2025 builds on the proven concept of integration, which ensures strong cash flows and resilience. OMV aims to grow both the Upstream and the Downstream businesses. In Upstream, our target is production and reserves growth in defined core regions. In Downstream, OMV will expand processing capacities and geographical reach considerably. Moreover, OMV will build a strong gas market presence in Europe. The Group will continue to improve its performance and extend its record of operational excellence. OMV strives to increase the clean Operating Result to at least  4 by 2020 (based on a Brent oil price of  70/, a price of EUR 20/ and an indicator refining margin of USD 5/bbl) and at least EUR 5 bn by 2025.The growth will be driven equally by Upstream and Downstream, and will be achieved both organically and through acquisitions. Strategic partnerships will remain an important lever for accessing attractive projects, with long-term perspectives and high value creation.

OMV – Strategy 2025

OMV – Strategy 2025 (graphic)


OMV’s Upstream business generates profitable growth through its high-quality portfolio, while remaining focused on cash generation. The target production levels of 500 and 600 kboe/d in 2020 and 2025, respectively, have been reconfirmed. Production will comprise more than 50% natural gas in the future to improve long-term carbon efficiency and adapt to the changing mix in global energy demand. To ensure a Reserve Replacement Rate of more than 100% (three-year average) and an average reserve life of eight to ten years in the long term, 1P reserves will almost double to more than 2 bn by 2025. Portfolio growth will be achieved primarily through acquisitions in low-cost, hydrocarbon-rich regions, but also through organic exploration and investments. Average production costs will not exceed USD 8/boe. Strict cost management, a focus on profitability, and prudent capital discipline will be of the utmost importance as OMV takes steps to reach these targets.

OMV will continue to focus its portfolio on five core regions. Portfolio expansion is being pursued with projects in OMV’s core regions, with particular focus on the Middle East and Africa, Russia, and Asia-Pacific to ensure sustainable replacement with low-cost barrels and to improve the Company’s overall resilience.

Strategic partnerships with the prospect of long-term value creation will continue to be an important pathway for OMV for accessing material volumes of oil and gas reserves. Working together with selected national oil companies as well as with strong international oil companies supports OMV’s expansion in its core regions and bolsters the Group’s technological capabilities, while also minimizing operational and financial risks.

OMV Upstream is planning to invest between EUR 1.3 and 1.7 bn annually in organic growth and operations until 2025. OMV’s budget for exploration and appraisal activities is EUR 350  in 2020.

Upstream – strategic achievements

Since the announcement of the OMV Strategy 2025 in March 2018, we have made major progress in implementing our strategy. The 2019 highlights are summarized below:

  • Generated strong earnings with a clean Operating Result of EUR 2.0 bn
  • Gas production increased to 57% of the total portfolio
  • Production costs reduced to USD 6.6/boe
  • Production increased to 487 kboe/d in 2019 and reached the 500 kboe/d mark in the fourth quarter of 2019
  • Developed Asia-Pacific into a core region
  • Increased footprint in the Middle East and Africa region
  • Three-year average Reserve Replacement Rate increased to 166%
  • 1P reserves base increased to 1.3 bn boe at year-end

Downstream Oil

In Downstream Oil, OMV will further strengthen its competitive position in Europe. OMV will modify its European refining assets by reflecting expected demand changes and shifting to higher-value products. By 2025, up to  1 will be invested in the refineries in Austria, Germany, and Romania. More than 50% of the investments will be used to expand OMV’s position in the petrochemical sector. The three sites will continue to be operated as one integrated refinery system, optimizing asset utilization and maximizing margins through the exchange of intermediate products. OMV is well positioned to capture the benefits of marine fuel market changes in 2020 as a result of new regulations issued by the International Maritime Organization (IMO). OMV has a low heavy fuel oil yield of 2% with flexibility to further reduce it. Western refineries will become heavy-fuel-oil-free by 2025.

In order to safeguard revenue and profitability in Europe, OMV will increase the share of our refineries’ production sold through captive sales channels from 47% in 2017 to 55% by 2025. This will ensure resilience and a refinery utilization rate of over 90% in the long term, which is well above the average in Europe. The retail business will increase fuel sales in the premium and discount segments. The number of discount stations will be expanded in Austria, Germany, and Slovenia. The focus of the premium retail network is on increasing the market share of the MaxxMotion premium product, growing the non-oil business, as well as developing additional customer-oriented retail products and services.

Building on OMV’s strong expertise as one of Europe’s leading refiners, the Group strives to export its successful European refining and petrochemical business model to international growth markets. By 2030, fuel demand is expected to grow significantly in Asia as well as in the Middle East and Africa. Petrochemicals demand is set to increase in all regions, especially in Asian markets. Overall, Asia will absorb more than 90% of the growth in global oil demand. Thus, OMV aims to nearly double its refining capacity and increase its petrochemical capacity by 2025 compared to 2018, establishing one to two core regions outside Europe.

Downstream Oil – strategic achievements

Since the announcement of the OMV Strategy 2025 in March 2018, we have made major progress in implementing our strategy. The 2019 highlights are summarized below:

  • Strong contribution to Group financials with a clean CCS Operating Result of EUR 1.7 bn
  • Built strong refining and petrochemical position in by acquiring 15% in ADNOC Refining, which operates the fourth-largest refinery in the world, and a new trading joint venture, ADNOC Global Trading
  • Increased share of refineries’ production sold through captive sales channels to 49% supported by storage tank acquisitions and an increased number of discount filling stations
  • Achieved utilization rate of the refineries of 97%
  • Plastic to oil, ReOil®: facility for production of synthetic crude oil from waste plastic developed from the R&D phase into a pilot project integrated into OMV’s refinery

Downstream Gas

European demand for natural gas is expected to remain stable until 2030, with upside potential of 30 primarily driven by a switch from coal to natural gas in power generation. In the same time period, European natural gas production is rapidly declining, causing a growing supply gap that needs to be filled. In this environment, OMV will become the leading integrated supplier with a strong market presence from Northwest to Southeast Europe. By 2025, OMV gas sales will grow to more than 20 bcm, thereby aiming at a 10% market share in Germany, Europe’s largest gas market. OMV will increasingly market natural gas from OMV’s own Upstream production as well as imported gas volumes. OMV’s integrated position in the European market will be strengthened by rising equity gas volumes from projects in Norway and Romania and long-term supply contracts with Gazprom.

With an increasing supply gap in Europe, higher volumes of natural gas will be imported. The Nord Stream 2 pipeline, which is close to completion is advantageous for OMV’s gas strategy. This pipeline will secure and increase consistent and reliable long-term gas supplies to Europe and the Central European Gas Hub in Baumgarten, Austria.

Downstream Gas – strategic achievements

Since the announcement of the OMV Strategy 2025 in March 2018, we have made progress in implementing our strategy. The 2019 highlights are summarized below:

  • Gas sales in Germany and the Netherlands significantly increased, reaching an average market share of 4% in Germany and more than 2% in the Netherlands in 2019
  • Successful market entry in Belgium
  • Growing cooperation on with Gazprom aiming for 1.2 bcm in 2020
  • Record volumes of 754 traded at CEGH
CCS/CCS effects/inventory holding gains/(losses)
Current Cost of Supply; inventory holding gains and losses represent the difference between the cost of sales calculated using the current cost of supply and the cost of sales calculated using the weighted average method after adjusting for any changes in valuation allowances in case the net realizable value of the inventory is lower than its cost. In volatile energy markets, measurement of the costs of petroleum products sold based on historical values (e.g. weighted average cost) can have distorting effects on reported results (Operating Result, net income, etc.). The amount disclosed as CCS effect represents the difference between the charge to the income statement for inventory on a weighted average basis (adjusted for the change in valuation allowances related to net realizable value) and the charge based on the current cost of supply. The current cost of supply is calculated monthly using data from supply and production systems at the Downstream Oil level
US dollar
Barrel (1 barrel equals approximately 159 liters)
Central European Gas Hub
Megawatt hour
Thousand barrels of oil equivalent per day
Barrel of oil equivalent
United Arab Emirates
Billion standard cubic meters (32°F/0°C)
Liquefied Natural Gas
Terawatt hour