Consolidated Report on the Payments Made to Governments

Section 267c of the Austrian Commercial Code

Section 267c of the Austrian Commercial Code (UGB) requires that large undertakings and public interest entities that are active in the extractive industry or logging of primary forests prepare the following consolidated report on payments to governments. This section implements Chapter 10 of Accounting Directive (2013/34/EU). The “Basis of preparation” paragraph provides information to the reader about the contents of the report. This also includes information on the type of payment for which disclosure is required and how OMV has implemented the regulations in the preparation of the report.

Basis of preparation

Reporting entities

Under the requirements of the regulation, OMV Aktiengesellschaft is required to prepare a consolidated report covering payments made to governments for each financial year in relation to extractive activities by itself and any subsidiary undertakings included in the consolidated Group financial statements.

Activities within the scope of the report

Payments made by the OMV Group (hereafter OMV) to governments that arose from exploration, prospection, discovery, development and extraction of minerals, oils and natural gas deposits or other materials within extractive activities are presented in this report.

Government

A “government” is defined as any national, regional or local authority of a country and includes a department agency or entity undertaking that is controlled by the government authority and includes national oil companies.

In cases where a state-owned entity engages in activities outside of its designated home jurisdiction, then it is not deemed to be a reportable governmental body for these purposes and thus payments made to such an entity in these circumstances are not reportable.

Project definition

The regulation also requires payments to be reported on a “project” basis as well as on a government and governmental body basis. A project is defined as the operational activities that are governed by a single contract, license, lease, concession or similar legal agreement and form the basis for payment liabilities to the government. Where these agreements as per the aforementioned definition are substantially interconnected, these agreements are treated for the purpose of these regulations as a single project.

“Substantially interconnected” is defined as a set of operationally and geographically integrated contracts, licenses, leases or concessions or related agreements with substantially similar terms that are signed with a government, giving rise to payment liabilities. Such agreements can be governed by a single contract, joint venture agreement, production sharing agreement or other overarching legal agreement.

There may be instances – for example, corporate income taxes, where it is not possible to attribute the payment to a single project and therefore these payments are shown at the country level.

Cash and payments in kind

In accordance with the regulation, payments have to be reported on a cash basis. This means that they are reported in the period in which they are paid and not in the period in which they are accounted for on an accruals basis.

Refunds are also reported in the period in which they are received and will either be offset against payments made in the period or be shown as negative amounts in the report.

Payments in kind made to a government are converted to an equivalent cash value based on the most appropriate and relevant valuation method for each payment type. This can be at cost or market value and an explanation is provided in the report to help explain the valuation method. Where applicable, the related volumes are also included in the report.

Payment reporting methodology

The regulations require that payments are to be reported where they are made to governments by OMV. It is required that the report reflect the substance of each transaction and activity. Based on these requirements, OMV has considered its reporting obligation as:

  • Where OMV makes a payment directly to the government, these payments will be reported in full, irrespective of whether this is made in the sole capacity of OMV or in OMV’s capacity as the operator of a joint operation.
  • In cases where OMV is a member of a joint operation for which the operator is a state-owned entity (i.e. a government), payments made to that state-owned entity will be disclosed where it is possible to identify the reportable payment from other cost recovery items.
  • For host government production entitlements, the terms of the agreement have to be considered; for the purpose of reporting in this report, OMV will disclose host government entitlements in their entirety where it is the operator.

Materiality

Payments made as a single payment or a series of related payments that are below  100,000 within a financial year are excluded from this report.

Reporting currency

Payments made in currencies other than euros are translated for the purposes of this report at the average rate of the reporting period.

Payment types disclosed

Production entitlements

Under production sharing agreements (PSAs), the host government is entitled to a share of the oil and gas produced and these entitlements are often paid in kind. The report will show both the value and volume of the government’s production entitlement for the relevant period in barrels of oil equivalent (boe).

The government share of any production entitlement will also include any entitlements arising from an interest held by a state-owned entity as an investor in projects within its sovereign jurisdiction. Production entitlements arising from activities or interests outside of a state-owned entity’s sovereign jurisdiction are excluded.

Taxes

Taxes levied on income, production or profits of companies are reported. Refunds will be netted against payments and shown accordingly. Consumption taxes, personal income taxes, sales taxes, property taxes and environmental taxes are not reported under the regulations. Although there is a tax group in place, the reported corporate income taxes for Austria relate entirely to the extractive activities in Austria of OMV’s subsidiaries, with no amounts being reported relating to OMV’s non-extractive activities in Austria.

Royalties

Royalties relating to the extraction of oil, gas and minerals paid to a government are to be disclosed. Where royalties are paid in kind, the value and volume are reported.

Dividends

In accordance with the regulations, dividends are reported when paid to a government in lieu of production entitlements or royalties. Dividends that are paid to a government as an ordinary shareholder are not reported, as long as the dividends are paid on the same terms as that of other shareholders.

For the year that ended December 31, 2020, OMV had no such reportable dividend payments to a government.

Bonuses

Bonuses include signature, discovery and production bonuses in each case to the extent paid in relation to the relevant activities.

Fees

These include license fees, rental fees, entry fees and all other payments that are paid in consideration for access to the area where extractive activities are performed.

The report excludes fees paid to a government that are not specifically related to extractive activities or access to extractive resources. In addition payments paid in return for services provided by a government are also excluded.

Infrastructure improvements

The report includes payments made by OMV for infrastructural improvements, such as the building of a road or bridge that serves the community, irrespective of whether OMV pays the amounts to non-government entities. These are reported in the period during which the infrastructure is made available for use by the local community.

Payments overview

The overview table below shows the relevant payments to governments that were made by OMV in the year that ended December 31, 2020. Of the seven payment types that are required by the Austrian regulations to be reported upon, OMV did not pay any dividends, bonuses or infrastructure improvements that met the defined accounting directive definition and therefore these categories are not shown.

Payments overview

In EUR 1,000

 

 

 

 

 

 

Production Entitlements

Taxes

Royalties

Fees

Total

Country

 

 

 

 

 

Austria

(3,227)

42,539

39,312

Kazakhstan

11,138

835

11,973

Malaysia

147,548

24,479

47,569

12,341

231,937

Norway

62,563

3,076

65,639

New Zealand

18,279

60,551

7,528

86,358

Romania

141,327

120,777

26,552

288,657

Tunisia

3,487

2,544

6,031

United Arab Emirates

22,195

72,525

836

95,556

Yemen

35,945

3,421

263

39,628

Total

183,493

280,241

349,926

51,431

865,091

No payments have been reported for Libya for the year 2020 as OMV was not the operator.

On November 30, 2017, OMV acquired a stake of 24.99% in OJSC Severneftegazprom (SNGP). As SNGP is an associated company and therefore accounted for using the equity method in OMV Group Consolidated Financial Statements it does not meet the definition of a reporting entity in the context of the Austrian Commercial Code.

On January 31, 2019, OMV and Sapura Energy Berhad closed the agreement to form a strategic partnership. The new entity, SapuraOMV Upstream Sdn. Bhd., and its subsidiaries are fully consolidated in OMV’s Group financial statements.

Payments by country

Austria

In EUR 1,000

 

 

 

 

 

 

Production Entitlements

Taxes

Royalties

Fees

Total

Governments

 

 

 

 

 

Federal Ministry of Agriculture, Regions and Tourism

42,539

42,539

Federal Ministry of Finance

(3,227)

(3,227)

Total

(3,227)

42,539

39,312

Projects

 

 

 

 

 

Lower Austria

(3,227)

42,539

39,312

Total

(3,227)

42,539

39,312

Kazakhstan

In EUR 1,000

 

 

 

 

 

 

Production Entitlements

Taxes

Royalties

Fees

Total

Governments

 

 

 

 

 

State Revenue Committee

11,138

226

11,364

Training centers universities

76 1

76

Licenced Research and Development Organisations

533 2

533

Total

11,138

835

11,973

Projects

 

 

 

 

 

Tasbulat, Turkmenoi, Aktas

4,100

570

4,670

Komsomolskoe

7,038

265

7,303

Total

11,138

835

11,973

1

Financing of various expenses with regard to university training centers as agreed within the concession agreement

2

Various expenses with regards to research and development works

Malaysia

In EUR 1,000

 

 

 

 

 

 

Production Entitlements

Taxes

Royalties

Fees

Total

Governments

 

 

 

 

 

Petroliam Nasional Berhad

59,870 1

47,569 3

10,164

117,603

Ketua Pengarah Hasil Dalem Negeri

24,479

185

24,663

Petronas Carigali SDN BHD

87,679 2

1,992

89,671

Total

147,548

24,479

47,569

12,341

231,937

Projects

 

 

 

 

 

Block PM323/PM329

66,232 4

6,630

12,390 6

4,786

90,037

Block AAKBNLP/PM318

3,915

3,381

7,295

Block SK408/SK310

81,317 5

13,935

35,179 7

4,174

134,605

Total

147,548

24,479

47,569

12,341

231,937

1

Includes payments in kind for 2,137,244 bbl of crude oil valued using the average monthly price per boe

2

Includes payments in kind for 4,761,603 bbl of crude oil valued using the average monthly price per boe

3

Includes payments in kind for 2,748,949 bbl of crude oil valued using the average monthly price per boe

4

Includes payments in kind for 1,667,523 bbl of crude oil valued using the average monthly price per boe

5

Includes payments in kind for 5,231,324 bbl of crude oil valued using the average monthly price per boe

6

Includes payments in kind for 313,634 bbl of crude oil valued using the average monthly price per boe

7

Includes payments in kind for 2,435,315 bbl of crude oil valued using the average monthly price per boe

Norway

In EUR 1,000

 

 

 

 

 

 

Production Entitlements

Taxes

Royalties

Fees

Total

Governments

 

 

 

 

 

Oljedirektoratet

3,031

3,031

Skatteetaten

62,563

34

62,598

Miljodirektoratet

10

10

Total

62,563

3,076

65,639

Projects

 

 

 

 

 

Gulfaks

95

95

Gudrun

95

95

Aasta Hansteen

11

11

Norway Exploration Projects

3,069

3,069

Payments not attributable to projects

62,362

6

62,368

Total

62,563

3,076

65,639

New Zealand

In EUR 1,000

 

 

 

 

 

 

Production Entitlements

Taxes

Royalties

Fees

Total

Governments

 

 

 

 

 

Inland Revenue

18,279

18,279

Maritime Safety Authority

46

46

Ministry of Business and Innovation

60,551

7,166

67,718

Environmental Protection Authority

316

316

Total

18,279

60,551

7,528

86,358

Projects

 

 

 

 

 

Maari

13,303

39

13,342

Maui

2,780

298

3,078

Pohokura

44,468

15

44,483

New Zealand exploration projects

347

347

Payments not attributable to projects

18,279

6,829

25,107

Total

18,279

60,551

7,528

86,358

Romania

In EUR 1,000

 

 

 

 

 

 

Production Entitlements

Taxes

Royalties

Fees

Total

Governments

 

 

 

 

 

State budget

141,327

120,777

262,105

Local counsils

4,532

4,532

National Agency for Mineral Resources (ANRM)

2,409

2,409

National Company of Forests

15,345

15,345

CONPET SA

98

98

National Authority for Electricity Regulation (ANRE)

3,596

3,596

Offshore Operations Regulatory Authority (ACROPO)

573

573

Total

141,327

120,777

26,552

288,657

Projects

 

 

 

 

 

Onshore production zones

91,846

22,242

114,088

Onshore Joint Operations

1,051

1,051

Offshore Black Sea

12,617

27,880

714

41,211

Payments not attributable to projects

128,710

3,596

132,306

Total

141,327

120,777

26,552

288,657

Tunisia

In EUR 1,000

 

 

 

 

 

 

Production Entitlements

Taxes

Royalties

Fees

Total

Governments

 

 

 

 

 

Receveur des Finances

3,365

3,365

Receveur des Douanes

122

122

Entreprise Tunisienne d’Activites Petrolieres

2,544 1

2,544

Total

3,487

2,544

6,031

Projects

 

 

 

 

 

South Tunisia

3,487

2,544 1

6,031

Total

3,487

2,544

6,031

1

Includes payments in kind for 75,057 bbl of crude oil valued using the average monthly price per boe

United Arab Emirates

In EUR 1,000

 

 

 

 

 

 

Production Entitlements

Taxes

Royalties

Fees

Total

Governments

 

 

 

 

 

Abu Dhabi National Oil Company (ADNOC)

836

836

Emirate of Abu Dhabi – Finance Department

22,195

72,525

94,720

Total

22,195

72,525

836

95,556

Projects

 

 

 

 

 

Umm Lulu und SARB

22,195

72,525

836

95,556

Total

22,195

72,525

836

95,556

Yemen

In EUR 1,000

 

 

 

 

 

 

Production Entitlements

Taxes

Royalties

Fees

Total

Governments

 

 

 

 

 

Ministry of Oil & Minerals

35,945 1

3,421 2

263

39,628

Total

35,945

3,421

263

39,628

Projects

 

 

 

 

 

Block S2

35,945 1

3,421 2

263

39,628

Total

35,945

3,421

263

39,628

1

Includes payments in kind for 1,003,699 boe valued at prices set by the Yemen Crude Oil Marketing Directorate

2

Includes payments in kind for 95,515 boe valued at prices set by the Yemen Crude Oil Marketing Directorate

Vienna, March 10, 2021

The Executive Board

Rainer Seele m.p.
Chairman of the Executive Board and Chief Executive Officer

Johann Pleininger m.p.
Deputy Chairman of the Executive Board and Chief Upstream Operations Officer

Reinhard Florey m.p.
Chief Financial Officer

Thomas Gangl m.p.
Chief Downstream Operations Officer

Elena Skvortsova m.p.
Chief Commercial Officer

EU
European Union
EUR
Euro