Austrian oil and gas conglomerate OMV will continue to rely on Russia for the majority of its gas supply this winter, according to CEO Alfred Stern. In an interview with the Financial Times, Stern emphasized that OMV has a long-term contract with Gazprom, signed in 2018 and lasting until 2040, and has no plans to exit this agreement. Stern stated that as long as Gazprom is able to supply gas, OMV will continue to purchase from them.
Russian gas is currently not subject to EU sanctions related to Ukraine, and Stern believes it is up to policymakers to decide whether to impose restrictions on it. He warned that eliminating certain energy sources, such as Russian gas, could lead to price rises. Stern stressed that as an industrial company, OMV has an obligation to use legally acceptable energy sources.
Despite its reliance on Russian gas, OMV has managed to diversify its supply sources over the past year. The company has secured gas flows from Norway and liquefied natural gas (LNG) terminals in the Netherlands and Italy. These alternate sources have provided enough non-Russian gas to cover OMV’s customer obligations.
In addition to diversification efforts, OMV has approved the allocation of €2 billion ($2.2 billion) for a joint venture with Romania’s Romgaz. This venture aims to develop the Neptun Deep gas field in the Black Sea, which is expected to come online by 2027. The gas field will contribute an additional 100 billion cubic meters of natural gas to the European market.
OMV plays a significant role in meeting Austria’s gas needs, covering approximately 30% of the country’s demand. Last year, the company was one of the first to agree to pay for Russian gas in rubles under a new settlement mechanism introduced by Moscow for “unfriendly countries” that had imposed sanctions on Russia. Stern emphasized that abandoning Russian gas would be impossible for Austria and would have severe consequences for the country’s economy and energy security.
Overall, OMV’s commitment to its long-term contract with Gazprom indicates a continued reliance on Russian gas. However, the company has taken steps to diversify its supply sources and secure alternative gas flows from other countries. The development of the Neptun Deep gas field in Romania’s Black Sea is expected to further contribute to the company’s efforts to ensure sufficient gas supply.