“It’s not clear when and in what form any decision will be made — it is too early to draw any final conclusions (on the U.S. sanctions),” OMV’s CEO Rainer Seele said in the company’s Q2 results conference call. “We are monitoring the situation very carefully and will make an assessment when all the facts are on the table.”
The executive said generally sanctions have “not proven” to be an effective tool to achieve a goal. However, the U.S. restrictions could make the financing of Nord Stream 2 more challenging as it could penalize companies helping build Russian energy export pipelines.
The polemic project is planned to carry 55 billion cubic meters per year (Bcm/y) of Russian gas to Germany by the end of 2019. Pipe laying of the twin line is expected to begin next year. Nord Stream 2 is fully owned by Gazprom, but European energy firms will finance half of the €9.5 billion ($11.19 billion) project.
Shell, Engie, Uniper, Wintershall and OMV have each committed to €950 million ($1.12 billion) towards the pipeline. Seeler said.
Seele doesn’t expect any impact from U.S. sanctions on the “two key upstream projects in Russia – Yuzhno-Russkoye and Achimov 4 and 5,” OMV is negotiating with Gazprom. In March, OMV agreed to buy Uniper’s 25% stake in Yuzhno-Russkoye for €1.75 billion ($2.06 billion). The deal has regulatory clearance and should close by year-end, the CEO said.
Negotiations with Gazprom on the swap agreement, with a 24.98% stake in Achimov 4/5, is expected to finalize in Q4 this year.