MOSCOW (MRC) -- OMV is to make Q4 2021 cash-neutral writedowns and value adjustments of around EUR1.7bn (USD1.95bn), said the company.
The group said the adjustments related to exploration and production, the fertiliser business of wholly-owned subsidiary Borealis and the fixed assets of Abu Dhabi National Oil Company's (ADNOC’s) refining unit. OMV holds a 15% stake in the unit. Fertiliser production across Europe has been affected in recent months by all-time-high natural gas prices.
OMV said in its update that the average realised price of natural gas in the final quarter of last year was up 190% year on year. For crude oil, the average realised price grew 80% from a year earlier, the company added. OMV previously announced it will attempt to sell the Borealis fertiliser unit.
Also in the update, OMV said its Q4 polyethylene (PE) indicator margin for Europe grew to EUR458/tonne from Q4 2020’s EUR378/tonne. The Q4 polypropylene (PP) indicator margin for Europe increased to EUR690/tonne from Q4 2020’s €405/tonne, it added. OMV will publish its fourth-quarter results, including the adjustments, categorised as special effects, on February 3.
As per MRC, OMV reported utilization of 83% at its European refineries in H1, 2021, down by 3% on the year yet "relatively resilient in light of the COVID-19 impact". It expects the utilization rates at its European refineries to remain at the 2020 level this year. Last year its refineries reported 86% utilization. The company's refineries in Europe ran at 85% utilization in Q2, up from 81% in the year-ago quarter.
As MRC wrote before, OMV is investing EUR40 million (USD48 million) to expand and modernize a steam cracker and associated units at its refining and petrochemicals complex at Burghausen, Germany. The upgrade will increase the site’s ethylene and propylene production capacity by 50,000 metric tons/year. Following a planned turnaround of the refinery, the revamped cracker and petchem units are expected to start operations in the third quarter of 2022. Initial groundwork is already underway ahead of the upgrade.
OMV produces and markets oil and gas, innovative energy and high-end petrochemical solutions – in a responsible way. With Group sales of EUR 23 bn and a workforce of around 20,000 employees in 2019, OMV Aktiengesellschaft is one of Austria’s largest listed industrial companies.
MRC