20 – Financial assets

Financial assets at fair value through profit or loss mainly consisted of financial assets held for trading.

Starting March 1, 2022, investments in the Russian entities JSC GAZPROM YRGM Development (YRGM) and OJSC Severneftegazprom (SNGP) were accounted for at fair value through profit or loss according to IFRS 9 following their deconsolidation, which was triggered by the Russian war on Ukraine.

As of December 31, 2022, the fair value of the investments in YRGM and SNGP was further reduced to a book value of EUR 23 mn, leading to an additional loss of EUR 370 mn in the financial result.

On December 19, 2023, the Russian President signed a decree regarding the Yuzhno-Russkoye field. According to this decree, OMV’s shareholdings in Russian entities and consequently its interests in the gas field are to be transferred to new Russian companies. Those companies will ultimately be held by the insurance company JSC SOGAZ and Gazprom. The proceeds from the transfer of the OMV interest to JSC SOGAZ are to be paid into a Russian special account. At first glance, this decree equals a unilateral and irreversible expropriation by seizing the interests of OMV in return for compensation that will be determined by Russia and placed in accounts that will eventually be under Russian control. OMV is examining the current facts and further developments and considering steps to protect its rights.

Based on this latest development and the unchanged situation with regard to the Russian war on Ukraine, OMV considers its investments in YRGM and SNGP to have a fair value of nil as of December 31, 2023, leading to a further negative fair value adjustment in the financial result for 2023 in the amount of EUR 23 mn.

The position loans in 2023 included loans and the related accrued interests under a member loan agreement with Bayport Polymers LLC in the amount of EUR 701 mn (2022: EUR 657 mn). In addition, the position included EUR 155 mn from a drawdown and the related interest accrued from a shareholder loan agreement (SHL) entered into on February 3, 2023, with Borealis AG as the lender and Borouge 4 LLC as the borrower to part finance Borouge 4 LLC’s CAPEX requirements for Borouge 4. The SHL is structured as a facility with a five-year tenor. Borealis retains the right to accelerate the prepayment of the outstanding amounts at the point of reintegration into Borouge PLC.

Other sundry financial assets included expenditure recoverable from the Romanian State amounting to EUR 399 mn (2022: EUR 326 mn) related to obligations for decommissioning and environmental costs in OMV Petrom SA. The receivables consisted of EUR 391 mn (2022: EUR 318 mn) for costs relating to decommissioning and EUR 8 mn (2022: EUR 8 mn) for costs relating to environmental remediation.

On October 2, 2020, as party in the privatization agreement, OMV AG initiated arbitration proceedings against the Romanian Ministry of Environment, in accordance with the ICC Rules, regarding certain claims unpaid by the Ministry of Environment in relation to well decommissioning and environmental restoration obligations amounting to EUR 31 mn. On August 30, 2022, the Arbitral Tribunal issued the Final Award on the arbitration and requested the Ministry of Environment to reimburse to OMV Petrom SA the amount of EUR 31 mn and related interest. In October 2022, the Ministry of Environment challenged the award at the Paris Court of Appeal, a procedure that was still ongoing as of December 31, 2023.

In Q4/22, OMV Aktiengesellschaft, as party in the privatization agreement, initiated two other arbitration proceedings against the Romanian Ministry of Environment, in accordance with the ICC Rules, which have been further consolidated in a single case, regarding certain claims unpaid by the Ministry of Environment in relation to well decommissioning and environmental remediation works. Such claims amount to EUR 47 mn and as of December 31, 2023, the arbitration procedure is ongoing.

In 2022 this position also included receivables related to insurance proceeds of around EUR 200 mn with regards to the incident at the crude distillation unit at the Schwechat refinery in June 2022, which was fully paid in 2023.

Additionally, other sundry financial assets contained receivables towards partners in the Exploration & Production business as well as seller participation notes and complementary notes in Carnuntum DAC (see Note 38 – Unconsolidated structured entities – for further details).

For further details on credit risk management see Note 30 – Risk Management.

The net remeasurement of expected credit losses was mainly related to the trade receivables from contracts with customers and increased due to re-evaluation of receivables in Tunisia.