8 – Depreciation, amortization, impairments and write-ups

Impairment losses are part of the income statement line “Depreciation, amortization, impairments and write-ups”, except for impairment losses related to exploration and appraisal assets, which are shown in “Exploration expenses”. The following tables provide a reconciliation to the amounts reported in the income statement.

Impairments and write-ups in Chemicals & Materials

On July 5, 2023, the sale of the nitrogen business unit in the Borealis Group, including fertilizer, technical nitrogen, and melamine products, to AGROFERT, a.s. was completed. To reflect the fair value less cost of disposal, based on the Sales Purchase Agreement with AGROFERT, a.s., an impairment of EUR 57 mn was recognized.

Additionally, the acquisition of the additional 48.55% stake in Renasci N.V. as of November 30, 2023, triggered a reassessment, which led to an impairment in the amount of EUR 54 mn, of which EUR 23 mn was allocated to the equity-accounted investment BlueAlp Holding B.V.

In 2022, a write-up of EUR 266 mn was recognized related to the sale of the nitrogen business unit of the Borealis group. The valuation was based on a binding offer from AGROFERT, a.s. dated June 2, 2022, to reflect the fair value less cost to sell.

Impairments and write-ups in Fuels & Feedstock

In 2022, there was a net write-up of EUR 67 mn of the ADNOC Refining and Trading CGU, mainly related to the impairment testing triggered by the positive near-term margin outlook for refining margins in the Middle East.

Impairments and write-ups in Energy

A write-up of EUR 114 mn was recognized in some CGUs in Libya following stabilized production in recent years. The recoverable amount, which was determined on the basis of the value in use, was EUR 821 mn. The after-tax discount rate used was 13.25%.

An impairment test was performed for the Etzel gas storage facility in Germany in 2023, resulting in a write-up of EUR 72 mn due to the improved market environment for gas storage facilities in Europe. The recoverable amount, which was determined on the basis of the value in use, was EUR 154 mn. The discount rate used was 5.25%.

Impairment losses in 2023 included impairments of EUR 152 mn mainly related to unsuccessful exploration wells and expired exploration licenses in Malaysia and Norway.

Other impairments in 2023 were primarily related to unsuccessful workovers and obsolete or replaced assets in Romania (EUR 55 mn).

In Q4/22, OMV updated its commodity price assumptions. Whereas European gas prices increased for the near and long-term, the expected production volume of some oil and gas assets in Romania decreased due to higher expected natural decline rates and operating costs increased. These effects led to pre-tax impairments of EUR 117 mn (net of write-ups) of some development and production oil and gas assets, related to assets in Romania, New Zealand, and Austria.

In 2022, impairment losses attributable to exploration and appraisal (EUR 183 mn) were mainly related to unsuccessful exploration wells and exploration licenses in Norway, New Zealand, Romania, and Australia.

Additionally, impairments in 2022 included mainly unsuccessful workovers, obsolete or replaced assets in Romania (EUR 84 mn), and a production license in Libya (EUR 70 mn).

The planned sale of OMV’s relevant operating entities in Yemen in Q2/22 led to the reclassification to “held for sale”, which triggered a pre-tax impairment of EUR 48 mn.