Scenario Analysis

Scenarios consistent with the goal of limiting the global temperature increase to no more than 2°C by reducing greenhouse gas emissions are critically important to our strategic considerations as they entail fundamental changes to the current energy market. We are aware of the potential risk of stranded assets if we cannot fully exploit our reserves due to surpassing the global carbon budget. During the strategy development and planning processes, OMV has considered scenarios reflecting various aspects (short- and long-term) of potential economic, technological, and social developments and their implications for the energy market and, consequently, for our business.

OMV operates on a global market with global traded products being affected by the energy transition at different paces. The assumptions in OMV’s mid-term plan (MTP) are therefore based on a scenario in which the energy transition in the EU, United States, China, Japan, and South Korea follows the goals of the Paris Agreement and the Sustainable Development Scenario (SDS) published by the International Energy Agency (IEA). For the rest of the world, OMV assumes that current and announced (not yet fully implemented) policies, targets, and plans have been carried out, which correlates with the Stated Policy Scenario (STEPS) of the IEA.

Reflecting the uncertainties of the energy transition, OMV performed a stress test analysis using a decarbonization scenario in line with an implementation of the Paris climate goals by applying the SDS on a global basis in order to understand the impact of this scenario on the recoverability of assets and valuation of liabilities. The stress test analysis impacts oil and gas price assumptions, CO₂ price assumptions, refining and petrochemical margins and cracks, power prices and spreads, as well as volume growth expectations. Commodity price assumptions may have a significant impact on the recoverable amounts of E&A assets, property, plant, and equipment (PPE), and goodwill. Oil and gas price assumptions had already been revised in 2020 to reflect the potential impact of energy transition and led to a pre-tax impairment of E&P oil and gas assets of EUR 1.2 bn. In 2021, the oil and gas price assumptions in the MTP scenario did not materially change compared to 2020. Consequently, no impairment losses were recognized due to changes in price assumptions.

According to the stress-case scenario, the carrying amounts of the proved oil and gas assets (including goodwill) would decrease by EUR 4.5 bn (thereof EUR 0.3 bn on goodwill). In addition, some unproved oil and gas assets would be abandoned (pre-tax impact of EUR 0.3 bn). The remaining carrying amount of oil assets would be EUR 2.3 bn.

In the Refining & Marketing segment, the stress case would lead to a further EUR 1.0 bn decrease in the carrying amounts of the Romanian refinery and the investment in ADNOC Refining. Due to the strong integration of the Schwechat and Burghausen refineries with the chemical business and the Chemical & Materials segment, the impact stemming from the energy transition is considered immaterial. (For more details, see also Effect of climate-related matters and energy transition in the Annual Report.)