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 does OMV’s strategy to diversify its gas sourcing impact its long-term business model and relationships with customers?
**Interview with Alfred Stern, CEO of OMV**
**Editor:** Good evening, Mr. Stern. Thank you for joining us to discuss the latest developments regarding OMV and its gas supply situation with Gazprom.
**Alfred Stern:** Thank you for having me.
**Editor:** Recently, OMV announced a potential interruption in Russian gas deliveries due to a €230 million damage award against Gazprom. Can you explain what this means for OMV and its customers?
**Alfred Stern:** Certainly. This award is linked to irregular deliveries and a complete cessation of gas deliveries in Germany last September. We are offsetting this claim against our payment obligations to Gazprom, which could lead to a halt in their gas supplies. However, we are well-prepared for this possibility, as our gas storage facilities are currently over 90% full.
**Editor:** That’s a significant level of preparedness. What alternative gas sources has OMV secured to mitigate the risks associated with a potential interruption from Gazprom?
**Alfred Stern:** We have significantly diversified our supply lines. We are now sourcing gas from Norway and have invested in liquefied natural gas (LNG) capacities. This diversified portfolio allows us to ensure that we can meet our customers’ contractual obligations even if Gazprom were to stop its supplies.
**Editor:** You mentioned that OMV is no longer dependent on Russian gas. How has this transition affected your business model?
**Alfred Stern:** Since July, we have been actively reducing our reliance on Russian gas. While we still have long-term contracts that require us to purchase a certain amount from Russia, we’ve strategically invested in alternative supplies. If Gazprom does cut off deliveries, as seems possible, it would provide us an opportunity to exit these long-term agreements and transition away from Russian gas altogether.
**Editor:** In light of the ongoing geopolitical tensions and the implications of this situation, how confident are you in OMV’s ability to sustain its operations without Russian gas?
**Alfred Stern:** I am quite confident. The preparations we’ve made over the past year have positioned us well. Even in the event of a disruption, our alternative supply agreements and full gas storage mean that we can continue to deliver the contracted volumes to our customers. Our priority is ensuring stability and reliability in our gas supply.
**Editor:** Thank you, Mr. Stern, for sharing these insights. It seems OMV is navigating a complex situation with strategic foresight.
**Alfred Stern:** Thank you for the discussion. We are committed to ensuring energy security for our customers in these challenging times.
This interview highlights the proactive steps OMV is taking in response to potential supply disruptions while emphasizing their commitment to energy security and reliability for customers.
