Energy

2030 strategic priorities

• Portfolio managed as a robust cash generator to support the Group’s transformation
• Production is expected to decline to ~370 kboe/d by 2025 and ~350 kboe/d by 2030, excluding any potential divestments
• Low-carbon business solutions will be developed, with around 10 TWh in renewable energy (e.g., geothermal) and around 5 mn t p.a. CCS, to significantly reduce absolute and relative GHG emissions
• Upon evaluation of its portfolio, OMV announced the start of the sales process of its E&P assets in the Asia-Pacific region

In the context of the ongoing energy transition and to support the OMV Group’s transformation, Energy will be managed as a robust cash generator and will focus on further upgrading its competitive asset portfolio, concentrating on the three core regions: Central and Eastern Europe, the North Sea, and Middle East and Africa. The shift of the hydrocarbon portfolio to gas will continue, with further divestments of non-core positions to improve efficiency, while the low-carbon business will be ramped up to achieve a material contribution by the end of the decade. On February 27, 2023, OMV announced that it started the sales process for the divestment of its E&P assets in the Asia-Pacific region: a 50% stake in SapuraOMV Upstream Sdn. Bhd. and 100% of the shares in OMV New Zealand Limited.

Starting with 2023, the Energy business incorporates the entire value chain of gas, as Gas & Power Eastern Europe, which includes Supply, Marketing and Trading of gas in Romania and Turkey and one gas-fired power plant in Romania, was transferred from Fuels & Feedstock to the Energy business segment.

Boosting value delivery and cash generation are the main goals and criteria for managing and developing the portfolio of oil and gas assets, with a strong emphasis on gas. The delivery over the mid-term of key projects in the portfolio, such as the Neptun Development in Romania, and the Umm Lulu SARB Phase 2 plateau extension in the UAE, will support strong cash generation by and beyond 2025. OMV expects production levels of ~370 kboe/d by 2025 and ~350 kboe/d by 2030, with a share of around 60% of natural gas, excluding any potential divestments. In order to sustain the above-mentioned production levels, ramp up the low-carbon business, and deliver strong cash generation, OMV Energy anticipates a total annual average CAPEX in 2022–2030 of around EUR 1.6 bn, EUR 0.6 bn of which are earmarked for low-carbon activities. OMV’s exploration and appraisal activities are being streamlined further, and the total annual average budget is expected to be around EUR 0.2 bn over the decade. Toward the end of the decade, oil and gas CAPEX and E&A expenditure will be reduced, thereby allowing for more capital to be allocated to ramping up the low-carbon business and the broader OMV transformation.

OMV Energy plans to reinforce the competitiveness of its portfolio and resilience through a strong focus on operational excellence, fostered by digitalization and agile ways of working, as well as portfolio optimization.

To supply its gas customers, OMV will continue to complement its own natural gas production in Norway, Austria, and Romania with third-party supply sources on which the Group is working to diversify. The equity gas contribution to the gas sales business will decrease significantly toward the end of the decade in the Northwestern European region due to natural fields decline, and, as needed, will largely be replaced with green gases, such as biogas and hydrogen, primarily obtained from the markets, to reduce the carbon intensity of its product portfolio. New equity gas volumes from the Romanian Neptun project will keep volumes high in Southeastern Europe. OMV will also aim to direct an increasing share of its natural gas sales to customers from non-energy sectors, to further reduce its Scope 3 portfolio emissions.

The Group will explore a range of opportunities and portfolio choices that enhance cash flow generated by the current Energy business and support a potential accelerated transition to sustainable fuels, chemicals, and materials. These opportunities may include capturing the full value potential of the asset base, e.g., low-carbon business potential, maintaining reservoir production excellence, and optimizing costs as well as assessing and developing joint venture opportunities for selected assets without excluding inorganic options.

To reduce its operational carbon footprint, OMV Energy will pursue the phase-out of routine gas flaring and venting, reduce fugitive methane emissions, and introduce portfolio optimization measures. In addition, renewable energy projects will also be pursued for the purpose of powering OMV’s own operations, such as the photovoltaic plant developed with VERBUND in Schönkirchen (Austria). To achieve an overall reduction of both absolute and relative GHG emissions from its product portfolio, OMV Energy will leverage its existing asset base and core skills to deliver financially strong low-carbon business projects. Available opportunities will be captured to build up geothermal energy capacity that generates up to 9 TWh p.a. by 2030. In addition to geothermal, around 1 TWh from renewable power will be developed in OMV core regions with favorable sun and wind conditions to serve primarily captive demand, thereby reducing Scope 2 emissions by OMV’s own operations. The Energy business will further tap its existing reservoirs and (sub-)surface capabilities to implement opportunities that lead to a CCS capacity of approximately 5 mn t p.a. of CO₂ net to OMV by 2030. In addition, further opportunities where OMV Energy can leverage its strengths and capabilities are being explored, e.g., hydrogen and energy storage, and will potentially be pursued in consideration of OMV strategic priorities.