OMV Reports Q3 Production Decrease Due to Shut-downs, Lower Performance in Romania

Austria’s integrated international oil and gas company OMV showed signs of difficulties on Thursday, announcing a 35% decrease in sales in the third quarter of the year with respect to the same period in 2014. On the other hand, it also reported a 31% increase in clean CCS net income. 

“Given the ongoing challenging oil price environment, we have decided to reduce our future oil price assumptions resulting in asset impairments in the Upstream business” Rainer Seele, CEO of OMV, commented in a note.  

Production of oil, NGL and gas registered a 6% decrease in the quarter, due to the shut-downs in Libya and Yemen, and lower gas production in Romania and Pakistan. Production increases in Norway (up by 18%) and New Zealand (up by 16%) partly offset this decline. 

The company’s strategy seems to hinge on the Downstream and on stronger ties with Gazprom.

“We have achieved several strategic milestones. We have signed a term sheet with Gazprom for OMV’s participation in the project Achimov IV/V based on an exchange of assets as well as the shareholder agreement for the Nord Stream 2 pipeline project. Additionally, we decided to sell a stake of up to 49% of Gas Connect Austria and reached a provisional agreement on the full takeover of EconGas by OMV, both of which mark important steps towards the optimization of the Downstream Gas portfolio” Seele explained.