In the Chemicals segment, OMV Group is one of the world’s leading providers of advanced and circular polyolefin solutions and a European market leader in base chemicals and plastics recycling. It comprises the production of base chemicals integrated with OMV operated refineries in Austria and Germany, Borealis´ base chemicals and polyolefin business, and several joint ventures. The Group has a decisive footprint in Europe and two strong partnerships, Borouge (with ADNOC) in the United Arab Emirates, and Baystar (with TotalEnergies) in the United States, enabling the supply of services and products to customers around the globe. The production capacity, including joint ventures, amounts to 7.0 mn t of base chemicals, 6.4 mn t of polyolefins, with an almost equal split between polyethylene and polypropylene, and 0.8 mn t of polyolefin compounding. The polyolefin business operates in five industry clusters: Consumer Products, Energy, Healthcare, Infrastructure, and Mobility.
On March 3, 2025 OMV and ADNOC signed a binding agreement for the combination of their shareholdings in Borealis and Borouge into Borouge Group International. Post-closing, OMV will hold 46.9% share in the new entity, Borouge Group International, with equal shareholdings and joint control alongside ADNOC. ADNOC and OMV have also agreed that upon completion of the combination, Borouge Group International will acquire Nova Chemicals for an enterprise value of USD 13.4 bn. The acquisition of Nova Chemicals, a North American-based polyolefin producer and a leader in advanced packaging solutions and proprietary technologies, will further strengthen Borouge Group International’s presence across the Americas and increase its exposure to advantaged feedstock. Borouge Group International will be uniquely positioned to create value and generate superior through-cycle shareholder returns, supported by synergies and a strong pipeline of organic growth projects. For more details, see Note 37 – Subsequent events.
Base Chemicals
Base chemicals are building blocks for the chemical industry and are transformed into plastics, packaging, clothing, and many other consumer products. OMV directly operates two steam crackers, which are physically integrated into the refineries in Austria and in Germany, allowing for cost-competitive naphtha supply. Borealis operates two crackers, one in Sweden and one in Finland, which both feature high feedstock flexibility and are able to use a high share of light feedstock, providing an economic advantage. In Belgium, Borealis runs a propane dehydrogenation plant based on 100% propane feedstock. OMV produces base chemicals such as olefins (ethylene, propylene, butadiene, and high-purity isobutene) and aromatics (benzene and phenol).
Despite the continued economic downturn in Europe burdening base chemicals demand, OMV Group’s European crackers operated at higher utilization rates in 2024 than the previous year, reaching 84% compared to 80% in 2023. Both planned and unplanned cracker outages, as well as permanent closures throughout the European industry, helped to maintain supply-demand balance in 2024. Additionally, high freight rates and increased transit times reduced import pressure into Europe while ethylene and propylene demand was slightly better than expected and improved compared to the previous year’s low levels. Despite challenging market conditions, OMV continued to produce and sell sustainable and circular chemicals and saw strong customer support.
In 2024, butadiene indicator margins surpassed 2023 levels. Supply was constrained leading to butadiene prices exceeding EUR 1,000/t in the second half of 2024. For several months, spot prices remained higher than contract prices. In contrast, 2023 experienced spot discounts which reached up to 50% due to a long market characterized by weak demand and ample supply. In 2024, OMV continued to sell sustainable butadiene, and tire-based pyrolysis oil was processed and sold for the first time. Benzene indicator margins significantly exceeded the prior year’s levels due to a very severe turnaround season in the US, logistical disruptions (Panama and Suez Canal), slightly improved demand, and reduced availability in Europe. In the first half of 2024 in particular, the market was buoyed by heavy exports to the US, reduced imports, limited cracker and refinery availability, and improved short-term demand. However, the second half of the year did not demonstrate the same level of strength, with indicator margins declining due to weak gasoline and derivative demand.
Growth Project – Kallo
Borealis has a second propane dehydrogenation (PDH) plant in Kallo (Belgium) under construction to leverage the expected growth in propylene demand in Europe. PDH is a vital process step in the production of propylene from propane. As one of the most important building blocks in the entire chemical industry, propylene is also the raw material used to produce polypropylene (PP). The construction project made significant progress in 2024, reaching more than 90% completion, and is planned to commence operations in the first half of 2026. The new facility will have a production capacity of 740 kt p.a. of propylene and will be connected to the existing pipeline network in the Amsterdam-Rotterdam-Antwerp (ARA) area, enabling cost-effective and sustainable propylene transportation.
Polyolefins
Through its subsidiary Borealis, OMV is the second-largest polyolefin producer in Europe and among the top ten producers globally. The value-added polyolefin products of Borealis are the foundation of many valuable plastics applications that are an intrinsic part of modern life. Borealis operates eight polyolefin plants located in Schwechat, Stenungsund, Porvoo, and Burghausen, where they are backward-integrated into steam crackers, as well as in Beringen and Kallo, with PDH-integration, and in plants in Antwerp and Geleen. In addition, Borealis operates several compounding plants in Europe, the United States, South Korea, and Brazil (JV with Braskem).
Building on its unique Borstar® polyolefin manufacturing technology, Borealis produces a large share of specialty polyolefin grades, which account for around 45% of the total sales volumes. While the standard polyolefins business is influenced by imports from various regions around the world, the specialty grades are afforded greater protection due to their advanced technological integration and the Company’s close customer relationships. Borealis’ advanced virgin and circular polyolefins play a crucial role in increasing sustainability along the value chain by promoting efficient use of natural resources and energy efficiency in the following key industries: consumer products, energy, healthcare, infrastructure, and mobility.
The polyolefins market in 2024 remained weak by historic levels but showed a marked improvement compared to the unprecedented destocking that occurred in the second half of 2023 across the value chain. From February to September, the European polyolefins market was bolstered due to disruptions to global container shipping, which increased logistics costs and delivery times of imported materials. As these disruptions eased in the last quarter of 2024, European supply increased, with a negative impact on industry profitability.
Renewable and Circular Chemicals
Plastics are essential to modern life, keeping our food fresh, our vehicles light, and our medicines sterile. In many applications, plastics offer distinct advantages over alternatives, for example plastic food packaging is highly effective at maintaining sterility and extending shelf-life, thus helping to reduce food waste. Car components made from plastic are lightweight yet sturdy, reducing the car’s weight and consequently in-use emissions. Today, the majority of plastics are often produced, used once, and then disposed of in landfills or incinerated. The circular economy products we offer provide a solution to reducing the amount of single-use plastics. Based on the principles of reduce, reuse, and recycle, we aim to keep materials in use for many lifetime-circles, lowering waste and decreasing the use of fossil resources in the production of new plastics. In this kind of circular economy, what might have been considered as plastic waste at one stage of the cycle, will be seen as a valuable raw material at another stage.
Transitioning to a circular economy will require a full suite of different, complementary technologies. The familiar mechanical recycling focuses on end-of-life plastics which are cleaned, mechanically flaked, melted down, and further processed into plastic granulate without significantly altering the material´s chemical structure. While it has proven to be effective and will likely remain the eco-efficient method of choice for the foreseeable future, mechanical recycling still faces limitations such as the processing of multi-layered feedstocks or its use in certain product applications, like contact sensitive packaging.
In contrast, chemical recycling using pyrolysis breaks down plastics into their hydrocarbon building blocks by heating them up to 400–450°C in an inert atmosphere. The resulting pyrolysis oil is then further processed in the petrochemical plants at the Schwechat refinery to produce a virgin base chemical that replaces fossil hydrocarbons as chemical feedstock for the production of new plastics. Chemical recycling is a vital complement to mechanical recycling as it targets hard-to-recycle plastics. The resulting raw material used for plastics production is indistinguishable in quality from fossil feedstock. In addition, chemical recycling enables plastics to be recycled indefinitely without a reduction in quality and the resulting feedstock is suitable for highly demanding applications such as products within the healthcare or energy industries and for contact sensitive packaging. Chemical recycling further strengthens circularity in the plastics value chain and helps stakeholders throughout the process to achieve their sustainability targets.
We are committed to advancing the circular economy at every stage in the plastics lifecycle, and are integrating circular principles as early as in the product design phase. OMV also seeks to maximize the use of alternative feedstocks, including biomass and end-of-life plastics. In practice, we operate proprietary mechanical and chemical recycling technologies and work on different strategies to secure end-of-life plastics as feedstock for our recycling processes. OMV aims to further increase the share of circular products in its overall production output by strengthening access to feedstock and increasing key mechanical and chemical recycling capabilities.
Partnerships for Feedstock Access
In October 2023, OMV announced the final investment decision to build an innovative sorting plant developed by Interzero, Europe’s leading provider of circular economy solutions, to produce feedstock for chemical recycling. For that purpose, OMV and Interzero established a joint venture, in which OMV holds 89.9% of the shares and 10.1% of the shares belong to Interzero. OMV is investing over EUR 170 mn in building this state-of-the-art facility in Walldürn, southern Germany. With a processing capacity of up to 260,000 t of post-consumer mixed waste plastic per year, this fully automatic sorting facility will be the first of its kind to produce feedstock for OMV’s chemical recycling on a large industrial scale. Construction began in the fourth quarter of 2023 and is currently advancing according to schedule, with production expected to start in 2026.
Moreover, OMV announced the signing of long-term supply agreements with TOMRA for recycling feedstock produced from mixed waste in April 2024. OMV will process feedstock supplied by TOMRA in its ReOil® plants in Austria, while Borealis will use TOMRA feedstock in its mechanical recycling operations in Europe. The feedstock will be derived from mixed post-consumer plastic material that would otherwise be lost to landfill and incineration.
Mechanical Recycling
The acquisition of Integra Plastics EAD, finalized in March 2024, is the most recent step to boost the Group’s advanced mechanical recycling output. This effort was further bolstered in June by the installation of a recyclate-based polyolefins compounding line in Beringen (Belgium). Once operational in 2025, this facility will use the continually upgraded Borcycle™ M technology to transform mechanically recycled post-consumer waste into high quality rigid polypropylene and polyethylene. This output is augmented by other mechanical recycling facilities in the Group, including Italy-based Rialti S.p.A, a leading polypropylene compounder of recyclates used in injection molding and extrusion and acquired by Borealis in 2023; Ecoplast Kunststoffrecycling GmbH in Austria; and mtm compact GmbH and mtm plastics GmbH in Germany.
Chemical Recycling
The ReOil® pilot plant at the Schwechat refinery has been recycling post-consumer and post-industrial plastics into pyrolysis oil using a pyrolysis process since 2018. In 2024, OMV finalized the construction of a new plant based on its proprietary ReOil® technology, thereby scaling up its chemical recycling capacities. The plant with a nameplate capacity of 16,000 t p.a. is mechanically complete and a phased start-up process has been initiated. The feedstock consists of ISCC PLUS certified post-consumer plastic waste and is supplied by partners from across the value chain, including waste management companies and mechanical recycling companies such as the Borealis subsidiary Ecoplast.
As a next step, OMV aims to develop a commercially viable industrial ReOil® plant at the Schwechat refinery with a processing capacity of up to 200,000 t p.a. In October 2024, CINEA, the European Climate, Infrastructure and Environment Executive Agency, selected this project from 337 applications for a EUR 81.6 mn grant.
Joint Ventures
Borouge (Borealis 36%, ADNOC 54%, free float 10%)
Established in 1998, Borouge is a true success story of the long-term partnership with ADNOC. The joint venture has successfully combined the leading-edge Borstar® technology with competitive feedstock and access to growing Asian markets. Borouge runs ethane-based steam crackers with a capacity of 3.6 mn t p.a. and an olefin conversion unit, converting ethylene into propylene, with a total capacity of around 0.8 mn t p.a. In addition, Borouge operates polyolefin plants with a total production capacity of 5 mn t p.a., thereof 2.7 mn t of polyethylene, 2.2 mn t of polypropylene, and 0.1 mn t of other products. In June 2022, Borouge was listed on the Abu Dhabi Securities Exchange (ADX) with 10% of the total issued share capital. Through Borouge, the Group’s footprint reaches all the way to the Middle East, the Asia-Pacific region, the Indian subcontinent, and Africa. Borouge ADP, the production company, is based in the United Arab Emirates, while Borouge PTE, the marketing and sales company, is headquartered in Singapore.
Growth Project – Borouge 4
The largest growth project currently underway is Borouge 4, situated within the Borouge joint venture founded by Borealis and the Abu Dhabi National Oil Company (ADNOC) in 1998. Ground was broken in 2022 for the construction of Borouge 4, the new USD 6.2 bn facility at the existing complex in Ruwais (UAE), and construction is on schedule and around 80% complete. The start-up of the first unit is scheduled by the end of 2025 with the subsequent units to gradually start-up in 2026. The Borouge 4 project will add a 1.5 mn t ethane-based steam cracker and two additional Borstar® polyethylene (PE) units with a total capacity of 1.4 mn t. The increased production capacity of advanced base chemicals and polyolefins that will be unlocked once Borouge 4 comes on stream will further enhance its role, as it will supply large volumes to customers in the Middle East and Asia as well as feedstock to the adjacent TA’ZIZ Industrial Chemicals Zone.
Baystar (Borealis 50%, TotalEnergies 50%)
The Baystar™ joint venture with TotalEnergies in Texas (US) operates an integrated world-scale 1 mn t ethane to polyethylene complex using the unique Borstar® technology. It includes a 1 mn t ethane cracker in Port Arthur, Texas, and three polyethylene units located in Pasadena, Texas. The two legacy polyethylene units, Bay 1 and Bay 2, have a combined capacity of 0.4 mn t while the new Bay 3 unit has a capacity of 0.6 mn t. Bay 3, which is based on the latest Borstar® 3G technology, started up in October 2023. With the completion of the USD 1.4 bn unit, Baystar™ has more than doubled its production capacity. As a fully integrated petrochemicals venture, it can supply value-added specialty polymers to the booming energy, infrastructure, and consumer product sectors in North America.