E1-3 Actions and Resources in Relation to Climate Change Policies

[E1-3.28] [MDR-A 68a, 68b, 68c, 68d, 68e] [E1-3.29a, 29b] [E1-4.34f] [AR 30a, 30b] Reducing emissions and sustainable energy solutions play a major role in our transformational path to meet society’s energy needs. To prevent and wherever applicable mitigate the impacts and risks identified for E1 Climate Change, OMV has defined the following key actions[MDR-A 69b] Key actions are defined as those requiring CAPEX of EUR ≥5 mn for their implementation. CAPEX includes additions to property, plant, and equipment and to intangible assets (incl. IFRS 16 right-of-use assets) and expenditures for acquisitions, as well as equity-accounted investments and other interest for pre-defined sustainability CAPEX categories. Decommissioning assets, government grants, borrowing costs, and other additions that by definition are not considered capital expenditure are not included in CAPEX figures. Within the boundaries of applicable accounting standards, expenditure incurred during project implementation is generally capitalized, thus included in the CAPEX figures. Figures are not validated by external bodies. For the material topic E1 Climate Change Mitigation, the key actions mainly refer to activities in Europe, the majority of them being in Austria, Germany, and Romania. Due to the threshold of EUR ≥5 mn per key action, the presented CAPEX figures do not represent the total CAPEX of OMV for actions addressing climate mitigation.. By increasing zero-carbon sales, using more recycled and sustainable feedstock, implementing Carbon Capture, Utilization, and Storage (CCUS), and improving operational efficiency, we address the negative impacts related to GHG emissions from our operations and products sold, as well as the low energy efficiency within our operations. These efforts help mitigate the high emissions and significant energy consumption in continued operations and business activities under the current business model. This has a positive impact on reducing GHG emissions through the energy transition, supporting society’s shift from a linear to a circular economy by offering diversified products with a reduced carbon footprint, and gradually moving away from fossil fuels toward achieving a net-zero business by 2050.

Innovation is a key element in OMV’s implementation of its Strategy 2030 and critical to the transformation of the value chain from a linear to a circular model. OMV is always looking for innovative solutions to optimize operations, evaluate business opportunities, and develop new business models to make OMV a sustainable company. The key actions listed in the table build on OMV’s existing expertise as well as on the latest available technologies, which are central to OMV’s implementation of its Strategy 2030 and achieving our GHG emissions reduction targets.

[MDR-A 69b] [E1-3.29c-i] In 2024, the implementation of key actions related to E1 Climate Change required CAPEX of EUR 1,046 mn. For OMV’s total CAPEX and its reconciliation to the investments shown in the cash flow statement, refer to the chapters Capital Expenditure (CAPEX) in the Directors’ Report and Consolidated Statement of Cash Flows in the Consolidated Financial Statements. [MDR-A 69b] [E1-3.29c-ii] Of the total 2024 CAPEX for implementing key actions, 71% is EU Taxonomy-aligned. Of the total planned CAPEX for implementing key actions between 2025 and 2029, 60% will likely be EU Taxonomy-aligned and part of the EU Taxonomy CAPEX plan. For details, see EU Taxonomy.

[MDR-A 69a] OMV seeks to align its long-term funding policy with the Company’s sustainability strategy. For this reason, OMV is assessing opportunities of sustainable financing and sustainability-linked funding, which links the cost of a financing instrument to the achievement of specific strategic sustainability targets. A first step toward sustainable financing was taken in 2021 with a green loan for the ReOil® 2000 chemical recycling plant in Schwechat, Austria. This loan was issued in alignment with the green loan principles and is based on a project-specific green financing framework and a second party opinion. For the implementation of other key actions included in the table above, no sustainable finance instrument is currently outstanding.

[E1-3 AR 21] OMV has a strong cash position (around EUR 5.8 bn reported as of the end of Q3/24). Furthermore, it typically relies on debt capital markets as its main funding source due to their efficiency, liquidity, and the availability of long(er) tenors. It aims for a broad diversification of its investor base and its funding sources and wants to maintain a balanced debt maturity profile. OMV targets efficient financing while at the same time ensures that its funding measures support its investment-grade credit rating and its long-term leverage ratio target (12% reported at the end of Q3/24). OMV also maintains committed and uncommitted bank lines to cover short-term cash flow fluctuations. Structures that enable OMV to optimize working capital complement the palette of funding tools. Funding of future growth and the transformation process will mainly rely on a mixture of operating cash flows, contributions from further cost optimizations, and disposals. Any additional financing can be raised via the set of tools depicted above, in line with the cash flow profile of the investment as well as OMV’s financial priorities and long-term targets. Hybrid capital will also remain a solid pillar of our capital structure in the long term.

Progress on Specific Key Actions

Increasing Zero-Carbon Products

Scaling up zero-carbon and renewable energy product sales while reducing fossil fuel sales is crucial for reducing the carbon footprint of our energy supply. These products include biofuels, electricity, waste heat, and emerging options like geothermal heat.

In our Energy division, the Low Carbon Business (LCB) team is active in the fields of geothermal energy and renewable power solutions. Over the past few years, initiatives in these areas have gained considerable momentum. Currently, many of these projects are in the assessment or initial investment stage, with plans to increase the level of investment after 2027.

We are working with Wien Energie in a joint venture called “deeep” to develop deep geothermal plants in the greater Vienna area. The first plant will be in Aspern, northeast of Vienna. The plant will have a capacity of 20 MW in combination with heat pumps. This capacity will be enough to supply around 20,000 households. Drilling of the first deep geothermal well started in December 2024. The wells will reach depths of over 3,000 meters to use the hot formation water for heat generation. The first geothermal plant of deeep will serve as the basis for the further expansion of geothermal energy in Vienna. Overall, OMV and Wien Energie want to develop up to seven geothermal plants with a capacity of up to 200 MW as part of a field development. This will enable the production of climate-neutral district heating for the equivalent of up to 200,000 Viennese households.

In our Fuels & Feedstock (F&F) division, we contribute to developing a sustainable energy system by identifying and maturing innovative solutions, especially for markets that are difficult to electrify with batteries and for customer segments like heavy road transport or air travel. These markets share a need for energy-dense, climate-friendly fuels with minimal downtime. Our portfolio promotes waste-based and advanced biofuels, hydrogen, and e-fuels, leveraging synergies with existing refinery assets and expertise in scalable and feasible green technology rollouts. The successful execution of these projects will lower our overall emissions, create innovative and sustainable products and services for society, and differentiate OMV as a leader in the green energy transition.

In June 2024 OMV, started up the coprocessing plant at the Schwechat refinery, where up to 160,000 t of liquid biomass per year will be converted into a high-quality renewable diesel blending component. Almost EUR 200 mn was invested and savings generated by the produced renewable fuel are around 360,000 t CO₂e.

Also in June 2024, OMV Petrom made the final investment decision to build a plant for sustainable aviation fuels (SAF) and renewable diesel (HVO) and two plants to produce green hydrogen, which will be used in the production of biofuels. Starting in 2028, OMV Petrom plans to supply around 250 kt/a of sustainable fuels. In the same month, OMV Petrom signed a new acquisition for photovoltaics projects in Romania and expanded its partnership with Renovatio through the acquisition of a 50% stake in renewable energy projects totaling 130 MW.

OMV is recovering waste heat in its Schwechat refinery and delivering it to Vienna Airport and Wien Energie. A total of 836,446 MWh was delivered in 2024.

In 2024, OMV’s Chemicals division continued to invest in its ReOil® technology and Borealis’ mechanical recycling processes to broaden the range of applications where recycled plastics or renewable feedstocks can be used as input sources, with a focus on waste supply, sorting, and treatment. Furthermore, Borealis invested in the cracker furnaces of its olefin unit in Porvoo, Finland, to increase the use of renewable and recycled raw materials in base chemicals production.

In our Retail business, OMV successfully continued its electromobility journey and implemented a full operating system including CPO (Charge Point Operator), eMSP (eMobility Service Provider), and app modules in Austria, Hungary, Romania, and Slovakia. In addition, in May OMV Petrom successfully finalized its acquisition of Renovatio Asset Management, the leading EV charging company in Romania. By the end of 2024, OMV was operating 804 (2023: 292) high-performance charging points. For an overview of where these charging stations are located, see Fields of Activity.

Carbon Capture and Storage

OMV aims to store around 3 mn t of CO₂ per year by 2030. Together with Aker BP, we hold the Poseidon license to store CO₂ in the Norwegian North Sea (OMV Norge 50%). The project has the potential for over 5 mn t of CO₂ to be stored annually. We intend to use the site as storage for CO₂ captured from various industrial plants across northwest Europe, including from Borealis’ European facilities. A 3D seismic survey was successfully carried out in late 2023. By 2025/26, a drill-or-drop decision will be made. In partnership with Vår Energi (operator) and Lime Petroleum AS, we were awarded a second CO₂ storage license in 2024 (OMV Norge 30%). The license, called Iroko, is located in the central Norwegian North Sea and can store around 215 mn t of CO₂, with the injection capacity expected to exceed 7.5 mn t of CO₂ per year.

In June 2024, OMV Petrom started testing an innovative capture and utilization technology at the Petrobrazi refinery. The testing of the new technology is part of a demonstration campaign carried out in three countries – Denmark, Romania, and Greece – as part of an innovation project financed by the European Commission through the Horizon 2020 program.

Energy Efficiency Measures

Effective carbon and energy management helps reduce GHG emissions and associated liabilities, thus lowering environmental costs, boosting financial savings through energy efficiency, and ensuring regulatory compliance. Government authorities require compliance with EU Emissions Trading System (EU ETS) regulations, national implementations of the EU Energy Efficiency Directive, and mandatory energy audits every four years. OMV’s comprehensive approach to managing GHG emissions is embedded within OMV’s strategy formulation and implementation. It is based on GHG and energy accounting and reporting, inventory management, audits, assessment plans, and training for employees.

Energy efficiency measures in OMV operations are closely linked with technical improvements directed at reducing energy use while achieving the same operational output. Process optimization and increasing energy efficiency to reduce costs and CO₂ emissions are also a priority at our refineries. At the Burghausen refinery, a project was implemented in 2024 to use the waste steam condensate stream from the Metathesis plant to heat the cooler steam condensate from the crack-gas compressor, increasing the energy efficiency of the process and resulting in an annual reduction of approximately 1,000 t CO₂e.

The potential for reducing energy use is identified through annual campaigns aimed at improving environmental performance, including through energy consumption. We set targets for refineries to achieve specific energy intensity index ratings, which are monitored yearly. Based on these ratings, we pinpoint areas for energy efficiency improvements and decide on measures to reduce consumption as part of our environmental governance.

Borealis accounts for 20% of OMV’s energy consumption and views energy efficiency as crucial to its climate strategy, aiming for a 10% reduction from 2015 levels by 2030. Joint facilities in Schwechat and Burghausen have initiatives to increase synergies, such as replacing the Schwechat refinery’s boiler feed water with cheaper, colder, fully desalinated water, resulting in energy and CO₂ savings.

Phasing Out Routine Flaring

[MDR-A 68a, 68b, 68c] During oil production, associated gas is produced alongside the oil. While much of this gas is utilized, some is flared due to technical or economic constraints, releasing greenhouse gases like CO₂ and methane. Around 1% of OMV’s total direct GHG emissions and around 6% of OMV Energy’s direct GHG emissions result from routine flaring. In 2017, OMV voluntarily endorsed the World Bank’s “Zero routine flaring by 2030” initiative. Existing sites where the routine flaring of associated and free gas still occurs are required to develop a phase-out plan to eliminate legacy routine flaring as soon as possible, but no later than 2030. New production sites are developed with the appropriate gas utilization solutions in place and without routine flaring. We report to the World Bank on our progress on this initiative annually. All OMV operations are also required to minimize methane emissions from point sources, as well as fugitive emissions and technically avoidable emissions (such as those from well testing and well workover, among other events). In 2024, we routinely flared 32,914 thousand m³ of associated gas. [MDR-A 68e] Since 2017, we have reduced routine flaring amounts by 77%.

Fugitive Emissions Monitoring and Leak Detection and Repair

[MDR-A 68a, 68b, 68c] OMV systematically monitors and controls fugitive methane emissions and other non-methane volatile organic compounds (NMVOCs) through Leak Detection and Repair (LDAR) programs. Routine audio, visual, and olfactory inspections, along with soap bubble testing and optical gas imaging, are used for leak detection. Advanced methods such as infrared cameras and collaborations with third parties using drones, satellite data, and acoustic leak imaging enhance monitoring efforts.

Leaks are repaired promptly based on prioritization and risk assessments. Key initiatives include the pipeline integrity program and modernizing facilities like compressor stations. OMV implements LDAR programs in both upstream (OMV Energy) and downstream (OMV Fuels & Feedstock) sectors to address fugitive emissions. LDAR programs in OMV Energy align with the GHG Management Framework, the OGMP 2.0 Framework, and the UN program for the reduction of methane emissions, which OMV joined in April 2024. An internal LDAR team in OMV Austria uses advanced technologies for regular site screenings, while OMV Petrom’s internal LDAR program covers over 300 facilities, focusing on methane screening and leak mitigation. Global and local methane management programs, including Ops CH4llenge at OMV Petrom, prepare operations for new methane detection, measurement, and reporting requirements.

Sourcing Renewable Energy for Operations

[MDR-A 68a, 68b, 68c] OMV is increasingly turning to renewable sources of electricity to power our operations. One approach is purchasing renewable energy, which subsequently reduces our Scope 2 emissions. For instance, electricity contracts for our refineries in Schwechat and Burghausen stipulate that 50% of purchased electricity must come from renewable sources. In 2024, 53% of the purchased electricity at the Schwechat refinery and 75% at the Burghausen refinery, including tank farms and pumping stations, came from renewable sources. All electricity purchased by OMV’s Austrian filling stations and the head office is obtained from renewable sources. For OMV’s refineries and the AWP, the electricity contracts are generally spot-indexed and contracted on a one- to three-year basis. Commodity pricing risk is managed using financial risk instruments.

OMV will continue to increase the sourcing of renewable electricity to power our operations. To reduce our Scope 2 emissions and achieve Borealis’ target of sourcing 100% renewable electricity by 2030 (status 2024: >50%), OMV has continued to establish several Power Purchase Agreements (PPAs) for long-term renewable electricity sourcing, securing the necessary electricity and utilities for production processes. OMV plans to increase our renewable electricity sourcing by an additional 580–780 GWh per year through more PPAs and solar power investments. In the Chemicals segment, which consumes the most energy, our goal is to ensure all purchased electricity is renewable by 2030. In 2024, electricity purchased in Chemicals accounted for 2,731 GWh (2023: 2,771 GWh), approximately 73% (2023: 73%) of OMV’s total electricity purchased. Where local regulations allow, OMV also plans to produce renewable energy and feed it into the grid for third-party use, with potential evaluations ongoing in our operational countries.

In 2024, OMV concluded Power Purchase Agreements (PPAs) with VERBUND and ImWind and secured an annual purchase of 67 GWh of sustainable electricity. This volume corresponds to the annual power consumption of around 16,000 households. With this supply of green energy, OMV will be able to cover over 35% of the external electricity requirements of the Schwechat refinery and the AWP. This enables OMV to reduce its carbon footprint and accelerate the use of renewable energy sources. In Germany, OMV has partnered with Statkraft, one of Europe’s largest renewable energy producers. This five-year agreement will see OMV sourcing 73 GWh of wind power annually to decarbonize its operations in Germany. In addition, Borealis entered into long-term PPAs with Finnish energy companies Fortum and Axpo Nordic, a subsidiary of Switzerland’s largest renewable energy provider, to source renewable energy from onshore wind parks. Starting in mid-2024, Borealis will receive 800 GWh of renewable power from Fortum over eight years to support its production operations in Porvoo, Finland. Additionally, Borealis will receive more than 130,000 MWh of wind power annually from Axpo Nordic for its production location in Stenungsund, Sweden, over the next ten years. This electricity will be generated by the new Hultema onshore wind farm in central Sweden, with delivery having commenced in January 2024.

Borealis’ Actions to Manage Impacts, Risks, and Opportunities for Climate Change Adaptation

[E1-3.28] [E1-3 AR 19d] [MDR-A 68a, 68b, 68c] Borealis has initiated a program on climate change adaptation. This program began with an initial high-level desk exercise for all of Borealis’ assets to identify locations with significant risks. A more in-depth desk analysis will be delivered in 2025, resulting in an overview of the locations where climate change poses a significant physical risk to Borealis’ assets.