The claim will now be offset against OMV‘s payment obligations to Gazprom Export from the Austrian supply contract, the Austrian company announced in the evening. This could lead to an interruption of Russian gas deliveries, warns OMV, but feels well prepared for this.
Memory 90 percent full
OMV has now set up alternative gas supplies from non-Russian gas as well as additional gas delivery capacities. Especially with gas from Norway and liquefied natural gas (LNG). “OMV confirms that the company can supply its customers with the contractually guaranteed gas volumes even in the event of a possible interruption in Gazprom Export’s supply,” the statement said. The OMV gas storage facilities are currently over 90 percent full.
This dispute concerned irregular deliveries from Gazprom Export and the complete cessation of deliveries in Germany in September 2022. The awarded damages will make a positive contribution to compensating for the financial damage incurred in 2022, OMV said today. If Gazprom were to stop deliveries in response to the settlement of the damages, OMV would incur small one-off hedging losses, which, however, would be “clearly outweighed” by the damages awarded. Gas deliveries of 5 TWh per month are potentially affected.
No longer dependent on Russian gas
OMV boss Alfred Stern had already said in July that OMV was no longer dependent on Russian gas. OMV has already significantly reduced its purchase of Russian gas. However, OMV says it cannot withdraw from the long-term supply contract, which obliges it to purchase gas from Russia in any case. If Gazprom were to stop its deliveries, this would be an opportunity for OMV to stop purchasing Russian gas. Even if, as Ukraine threatened, no more Russian gas flows through Ukraine from the turn of the year, Russia would be in breach of contract and OMV could withdraw from the now unpopular long-term supply contract. The scenario that gas from Russia will no longer come to Austria has now lost its horror.
What specific steps is OMV taking to enhance its energy security in light of the recent arbitral award against Gazprom?
**Interview with Alfred Stern, CEO of OMV**
**Interviewer:** Thank you for joining us today, Alfred. Recently, OMV received an arbitral award of over €230 million related to irregular gas supplies from Gazprom. Can you explain how this situation arose and the implications of the award for OMV?
**Alfred Stern:** Thank you for having me. The situation primarily stems from Gazprom’s irregular deliveries and a complete halt in supplies to Germany back in September 2022. This award will help offset some of the financial damages we incurred during that period. We view this as a significant step, not just in financial terms, but also as part of our efforts to stabilize our operations in the context of our long-term contracts with Gazprom.
**Interviewer:** It seems that the award will affect OMV’s future payments to Gazprom Export. How well prepared is OMV for a potential interruption in gas supplies from Russia?
**Alfred Stern:** We are well-prepared. Our gas storage facilities are currently over 90% full, which positions us favorably. We’ve also established alternative gas supply routes, particularly from Norway and through liquid natural gas (LNG). This allows us to ensure that we can meet our contractual obligations to our customers even if there are disruptions to Russian gas flows.
**Interviewer:** Given the current geopolitical climate and the uncertainty surrounding Russian gas supplies, has OMV considered the long-term impacts of its contracts with Gazprom?
**Alfred Stern:** Absolutely. While we have started to significantly reduce our dependency on Russian gas, we remain tied to a long-term supply contract. That said, if Gazprom were to halt deliveries, it would provide us a legitimate opportunity to reassess our obligations under that contract. Essentially, any breach of contract on their part could free us from our long-standing commitments.
**Interviewer:** You mentioned that OMV is no longer reliant on Russian gas. Can you elaborate on how you’ve transitioned your supply strategies?
**Alfred Stern:** We’ve made considerable investments in diversifying our supply sources. This includes increasing our import of natural gas from alternate suppliers and enhancing our LNG capabilities. This strategic shift not only safeguards our supply chain but also aligns with our broader goals of energy security and sustainability.
**Interviewer:** how does OMV plan to communicate with its stakeholders regarding these developments?
**Alfred Stern:** Transparency and proactive communication are key. We will keep our stakeholders informed through regular updates—whether through press releases or direct communications. It’s important they understand how we are navigating these changes and the rationale behind our strategic decisions.
**Interviewer:** Thank you, Alfred, for sharing your insights on these important developments for OMV.
**Alfred Stern:** Thank you for the opportunity to discuss our strategy and the future of OMV.