Zero-Carbon Products

The scale-up of zero-carbon and renewable energy product sales while reducing fossil fuel sales is central to reducing the carbon footprint of our energy supply. Zero-carbon and renewable energy products include biofuels, electricity, waste heat, and new energy products such as geothermal heat.

In our upstream division, the Low Carbon Business (LCB) team has been working on expanding our photovoltaic asset base, including exploring battery and storage options. Based on our subsurface knowledge, capabilities, and asset base, we have also been exploring carbon capture and storage solutions. We collaborate with industry and research partners on these activities in line with applicable regulatory and legal requirements. We are also investigating solutions for subsurface energy storage, e.g., with hydrogen or compressed air, and looking at options to explore and commercially develop geothermal energy potential in the countries where we operate. These projects are in the R&D or initial investment phase.

In R&M, we are contributing to the creation of a sustainable energy system by identifying and maturing solutions, with a strong focus on markets that are hard to electrify using batteries and customer segments such as heavy road transport or air travel. What these markets have in common is that they need an energy-dense yet climate-friendly fuel with the lowest possible downtime. Our portfolio focuses on waste-based and advanced biofuels, hydrogen, and e-fuels, as these offer the potential to utilize synergies with existing refinery assets and competences for a feasible scale-up and roll-out of green technologies.

The successful implementation of all these projects will reduce our absolute emissions, create green, innovative products and services for society, and provide a key differentiator for OMV.

Management and Due Diligence Processes

OMV has defined sustainability criteria that influence which projects and technologies are selected for investment. For all investments and M&A activities, it should be ensured that all climate-related risks are identified, assessed, and evaluated. This will include the assessment of the actual and forecast carbon footprint of the respec­tive investment and M&A. Projects that contribute positively to the achievement of OMV’s climate targets are preferred for investment (for more details, see Sustainability Governance). All project ideas selected for maturing need to demonstrate a feasible trajectory from pilot and demo stage to full industrial scale in the medium term.

Responsible Biofuels Sourcing

All biofuels purchased by OMV in 2022 and used for blending meet the requirements of the EU’s Renewable Energy Directive (EU) 2018/2001. Since 2013, the ISCC EU certificate issued for OMV Downstream GmbH has been renewed on an annual basis. OMV Petrom, OMV Hungary, OMV Czech Republic, OMV Germany, OMV Slovakia, and OMV Slovenia are also certified according to the ISCC EU standard.

Biofuel Volumes¹2021 figure restated and 2022 figure estimated as both Austria and Germany data are based on year-to-date actuals plus a forecast for the remaining months each year, given that the annual deadline for closing all biofuel balances of a given year is not before the publication of the Sustainability Report.

In megaliters

OMV purchases biodiesel mainly from European produc­ers that use very little palm oil. International Sustainability & Carbon Certification (ISCC) standards require that no deforestation took place from January 2008 onward for any feedstock that is used for biodiesel generation. Since July 2021, OMV has also complied with the Austrian legal requirement not to use palm-oil-based biofuels for target fulfillment. In 2022, of all biofuels placed on the market by OMV, only around 0.6% were based on palm oil. The main feedstocks used are rapeseed oil (31%), soybean oil (14%), used cooking oil (11%), corn (12%), wheat (9%), and triticale (5%).

OMV plans to use vegetable oils and used cooking oil as well as other potential waste and advanced feedstock to produce biofuels using our Co-Processing technology. Co-Processing involves introducing biogenic feedstock during the fuel refining process instead of the conventional method of blending biogenic components into fuel after production. This concept allows OMV’s existing refineries to produce transportation fuels from various types of biogenic feedstock.

In 2016 and 2017, OMV successfully conducted the first field trials of Co-Processing at the Schwechat refinery using rapeseed oil, and obtained certification in accordance with the REDcert standard, an EU-recognized system for the certification of sustainable biomass. In 2020, another field trial was successfully completed at the Petrobrazi refinery. OMV continues to implement the Co-Processing technology, and in 2023, the Company aims to start its 200 kta co-processing of sustainable feedstock in Schwechat. It is important to note that no palm oil will be co-processed. The project will start with a mix of vegetable oils (rapeseed oil and sunflower oil). It may include some other waste and residue streams like used cooking oil in future (2024–2025). In December 2020, OMV committed to investing EUR 200 mn in the construction of the Co-Processing unit at the Schwechat refinery. Utilizing this process will lead to an annual reduction of OMV’s carbon footprint of up to 360 kt CO₂.

2022 Actions

The following key activities were carried out across the Group in 2022:

Geothermal Energy

In 2022, the LCB made headway in the development of two geothermal projects: one in Austria, the other in Germany. In Austria, OMV conducted a production and injection test to analyze the geothermal potential in the Vienna Basin. Regional and local geological studies have been progressing, and potential locations for geothermal power plants have also been selected. In Lower Saxony, Germany, OMV and partner ZeroGeo Energy GmbH have an equal interest of 50% each in a geothermal exploration project called Thermo. The initial project aim is to collect geological data, in particular gravity and magnetic mea­surements, over an area of approx. 5,000 km². The data collected will be used to assess the geothermal energy potential and will be part of a comprehensive evaluation of future geothermal activities in the area. Based on preliminary studies, subsurface experts indicate that the geothermal conditions in the Vienna Basin are suitable for use as a direct heat carrier. In northern Germany, the geothermal energy could be used to generate electricity.

Glycerin2Propanol

OMV made the final investment decision in 2021 to build a Glycerin2Propanol pilot plant at the Schwechat refinery. It will be based on its newly patented process technology, which will produce propanol from low-value material crude glycerin from 2023 onwards. The plant will use a catalyst, or reaction accelerator, developed in-house by OMV to transform the biogenic waste-based crude glycerin into a so-called advanced bioalcohol (propanol). In doing so, the plant will generate what are known as advanced biofuels, which are not in competition with foodstuffs and which, when added to gasoline, reduce its carbon footprint.

While glycerin is a waste/by-product of the production of biodiesel and the manufacture of detergents and soaps, it is also considered an advanced feedstock under the European Union’s RED II Renewable Energy Directive. The propanol produced in this way will then be used as an advanced bioadditive for gasoline. It can also be used as a sustainable feedstock for the chemicals market to replace fossil-fuel-based propanol. OMV is set to invest around EUR 30 mn in the scale-up of this project, of which around EUR 8 mn will be funded through the Austrian Research Promotion Agency (Forschungsförderungsgesellschaft; FFG) and the COVID-19 premium. The capacity of the pilot plant will be 1.25 mn l of propanol per year. This will lead to a CO₂ reduction of around 1,800 t annually. A total of 1.2 l of crude glycerin is needed to produce 1 l of propanol. Under moderate temperature and pressure, 1 barrel (159 liters) of propanol will be produced per hour in an energy-efficient process. The long-term plan is to commercialize the technology to produce around 125 mn l of propanol per year and reduce CO₂ emissions by around 180 kt. The Glycerin2Propanol pilot plant will be located at the Schwechat refinery alongside the ReOil®^® plant so that both units can take advantage of a combined operator station, exploiting the synergy of a shared operator concept. In addition to this unique in-house development, we also partner with technology providers to develop viable business projects for transforming biomass from agriculture, municipalities, the paper industry, or wood processing into bioliquids to be used for greener fuels and chemicals.

In 2022, the Glycerin2Propanol pilot plant was in the execute phase, from the end of detail engineering to construction. The project team and the contractor (Dutch pilot plant company Zeton) worked closely to successfully accomplish the preliminary assembly of the modular plant in the workshop at Zeton.

Hydrogen

Together with our partner Kommunalkredit Austria AG, in February 2021, we announced a joint investment in the construction of Austria’s largest electrolysis plant at our Schwechat refinery. Total investment will be around EUR 25 mn, with OMV and Kommunalkredit each bearing half the cost. The plant is expected to go live in the second half of 2023. The 10 MW PEM (polymer electrolyte membrane) electrolysis system will produce up to 1,500 t of green hydrogen per year. The green hydrogen will be used to hydrogenate biobased and fossil fuels, substituting gray hydrogen in the refinery. This would reduce OMV’s carbon footprint by up to 15 kta of fossil CO₂. Furthermore, the extension of the value chain into the transport sector is being evaluated, e.g., for application in the hard-to-electrify segment (e.g., trucking).

To help create the conditions for the mass-market roll-out of hydrogen trucks in Europe, the H₂Accelerate initiative, a consortium consisting of OMV, Shell, Daimler Truck AG, IVECO, and the Volvo Group, was formed in 2020. In 2021, TotalEnergies and Linde joined the consortium. A large-scale roll-out of hydrogen-fueled trucks in Phase II (2025+) is expected to create new industries: zero-carbon hydrogen production facilities, large-scale hydrogen distribution systems, a network of high-capacity refueling stations for liquid and gaseous hydrogen, and production of the hydrogen-fueled trucks themselves. The decade-long scale-up is expected to begin with groups of customers willing to make an early commitment to hydrogen-based trucking. These fleets are expected to operate in regional clusters and along high-capacity European corridors with good refueling station coverage. During the next decade, these clusters can then be interconnected to build a truly pan-European network.

Retail 2022

Sustainable Aviation Fuels

Another focus topic is the hard to electrify area of e-fuels, the core building block of OMV’s Sustainable Aviation Fuel (SAF) portfolio, which shows great potential for enabling climate-friendly air travel. While in theory the concept is simple, i.e., hydrogen produced with renewable electricity is combined with CO₂, the production technology is still in the demonstration phase and requires further research and development for the required industrial scaling.

OMV is leading a project consortium together with industrial partners like BASF and thyssenkrupp Uhde, and academia (e.g., the German Aerospace Centre DLR and ASG Analytik-Service Gesellschaft) to develop a process to produce SAF based on methanol (M2SAF project). In addition to catalyst development, process development, plant integration, and the design of a demo plant, the project also includes techno-economic and -ecological analysis, as well as accompanying support for the certification and analysis of the new aviation fuels. The project is also targeting the production of a 100% drop-in capable SAF and enabling a process route with high selectivity and minimal additional CO₂ emissions, and with a high degree of inte­grability into existing brownfield or greenfield installations. The starting point of the process is sustainably produced methanol, either from CO₂ and hydrogen or from biogenic feedstock. The development project started in August 2022 for an initial period of 2.5 years and is being funded by the German Federal Ministry for Digital and Transport (BMDV).

OMV is already delivering SAFs to Austrian Airlines at Vienna airport. In 2022, Memorandums of Understanding (MoUs) for the intended offtake of SAFs were signed with the Lufthansa Group, Wizz Air, and Ryanair. The total amount of intended SAF offtake between 2023 and 2030 is up to 160,000 t for Ryanair, up to 185,000 t for Wizz Air, and more than 800,000 t for the Lufthansa Group. The OMV Group aims to increase the production and marketing of SAFs from <2 kt in 2022 up to 700 kta in 2030.

Outlook

• In the coming years, we will focus on implementing the investment projects mentioned (e.g., Glycerin2Propanol), and maturing project ideas in the areas of advanced biofuels and e-fuels. By 2030, we aim to produce and market at least 700 kta of sustainable aviation fuels. OMV will also expand its capabilities to take advantage of the growth in electric vehicle charging. By investing more than EUR 400 mn by 2030, OMV will offer more than 2,000 electric charging points at highway and transit route filling stations, plus around 17,000 office wall-box charging points. In addition, following the MoU signed by the OMV Group and Austrian Post in 2021 for the use of green hydrogen in heavy goods vehicles (HGVs), the first use of green hydrogen is expected in 2023 at the latest. By 2030, 2,000 HGVs will be powered by green hydrogen fuel cells.
• For the Glycerin2Propanol project, the factory accep­tance test will be conducted in the first quarter of 2023 and the arrival of the first modules in Schwechat is planned for the second quarter of 2023. In parallel, the propanol from OMV’s biobased process has been registered at the European Chemicals Agency (ECHA) as the first form of renewable propanol, a precondition for the bulk chemical market. Looking to the future, collaborative R&D efforts have begun to transform the propanol into sustainable aviation fuel.
• Investments of approx. EUR 5 bn have been planned until 2030 to build the Low Carbon Business (LCB). In our Energy division, the LCB team has been working on expanding our renewables asset base with a focus on captive use within the OMV Group. Furthermore, we are looking at opportunities to explore and commercially develop the geothermal energy potential. Based on our subsurface knowledge, capabilities, and asset base, we have also been exploring carbon capture and storage solutions. We collaborate on these activities in line with applicable regulatory and legal requirements in conjunction with industry and research partners. Additionally, we are also investigating solutions for subsurface energy storage, e.g., with hydrogen or compressed air. These projects are in the R&D or initial investment phase.
• In Romania, 2022 saw OMV Petrom and Complexul Energetic Oltenia deciding to invest more than EUR 400 mn over the coming years in building four PV parks in Ișalnița, Tismana, Roșia, and Rovinari, on the sites of the former mining operations run by Complexul Energetic Oltenia. The PV parks will produce a total of 450 MW, and from 2024, we anticipate that the renewable energy produced will be supplied to the national energy system.