"From today's point of view, OMV does not expect natural gas exports from Russia to stop entirely, however, the uncertainty regarding future curtailments remains and could result in further losses in case the hedged volume deviates from the actual deliveries," the company said in a report.
According to the report, OMV purchased an average of 6.67 TWh per month of natural gas under long-term contracts with Russian energy giant Gazprom but the cuts in supplies since mid-June have forced the company to resort to hedging and "resulted in a negative financial impact."
OMV listed several contingency plans in case the disruptions persist, such as tapping into the reserves, using liquefied natural gas sourced from European hubs, or ramping up supplies from Norway and other non-Russian exporters. The energy company is also set to secure cross-border capacities, in particular to Austria.
In mid-June, Russian energy giant Gazprom reduced gas supplies via Nord Stream 1 to 40% of the pipeline's capacity due to delays in maintenance work on turbines by German and Canadian companies, forcing EU countries to tap into winter gas reserves and consider returning to coal production. This week, the supplies were further slashed to around 33 million cubic meters per day, which constitute less than 20% of the pipeline's nominal capacity.
OMV is one of the largest energy companies in Central Europe. It is engaged in exploration and production of hydrocarbons in 17 countries, including countries of North Africa, Northwest Europe, the Middle East, the Caspian region, Australia, and New Zealand.