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 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.
How is OMV ensuring energy security for its customers in light of recent challenges with Gazprom’s gas deliveries?
**Interview with Alfred Stern, CEO of OMV AG**
**Interviewer:** Welcome, Alfred. Thank you for joining us today. Recent news reports indicate that Gazprom plans to halt gas deliveries to Austria starting November 16, which has raised concerns about supply disruptions. Can you share OMV’s perspective on this situation?
**Alfred Stern:** Thank you for having me. Indeed, Gazprom’s decision to stop delivering gas to Austria is significant. However, I want to reassure our customers and stakeholders that OMV is well-prepared for this eventuality. We have strategically diversified our gas supply sources and currently have our gas storage facilities over 90% full, allowing us to continue meeting our contractual obligations even if Gazprom halts its supply.
**Interviewer:** That’s encouraging to hear. OMV has established alternative supplies from sources like Norway and LNG. How do these alternatives fit into your overall strategy as you navigate this challenging situation?
**Alfred Stern:** Our strategy has always focused on reducing dependence on Russian gas supplies. While we cannot fully withdraw from our long-term supply contract with Gazprom due to existing obligations, we have made significant progress in sourcing gas independently. This not only gives us flexibility but also supports our commitment to energy security. Moreover, the arrangements with Norway and LNG will help stabilize our supply regardless of external disruptions.
**Interviewer:** There seems to be some background regarding irregular deliveries from Gazprom and financial claims. Can you elaborate on how this impacts OMV and its customers?
**Alfred Stern:** Yes, the disputes with Gazprom concerning irregular deliveries, including the complete stoppage in Germany last year, have necessitated legal and financial evaluations. The awarded damages from these disputes will partly offset our payment obligations to Gazprom, which could influence future gas flows. However, we’re optimistic that any potential short-term losses we may face would be outweighed by the financial compensations we received.
**Interviewer:** Some analysts suggest that if Gazprom were to stop deliveries in light of the compensation settlement, OMV might be able to exit its long-term contract. Could you clarify this?
**Alfred Stern:** That is a possible scenario. If Russia fails to fulfill its contractual obligations by ceasing deliveries, it would indeed open the path for us to reconsider our long-term contract with Gazprom. We are actively monitoring the developments and are committed to acting in the best interests of our stakeholders.
**Interviewer:** Thank you for the insights, Alfred. Given the evolving energy landscape in Europe, what is your outlook on OMV’s role and the future of gas supply in the region?
**Alfred Stern:** OMV is positioning itself as a resilient player in the energy market, focusing on diversification and sustainable practices. The European energy landscape is shifting, and we are dedicated to ensuring stability and reliability in gas supply, regardless of geopolitical challenges. We believe that fostering strong partnerships and leveraging alternative sources will be crucial for adapting to future demands.
**Interviewer:** Thank you, Alfred, for your time and for sharing your perspectives on this complex situation. We appreciate your insights.
**Alfred Stern:** Thank you! It’s been a pleasure discussing these important issues with you.
