(Reuters) -Austria’s OMV said on Monday it was cutting sustainable investments and slashed its target for yearly organic capital expenditures by 1 billion euros ($1.2 billion) until 2030, also to reflect the deconsolidation Borealis following a merger deal.
The oil, gas and chemicals group set its new organic capital expenditures goal to 2.8 billion euros per year, down from the previously projected 3.8 billion euros.
It joins a slew of oil and gas companies, including London-listed BP and Norway’s Equinor, that have lowered or delayed their sustainable investments as market for renewable energy sours.
OMV plans to reduce investments in fuels and energy businesses by 1.5 billion euros in the four years through 2030, as it seeks to balance risks and opportunities, it said. Around 30% of the remaining organic investments will be allocated to sustainable projects, versus a previous target of 40-50%, it added.
“The decision to pace investments in low carbon is also the right one in our view given the continued challenges and uncertainty in the space,” RBC analysts said in a note.
Carving out Borealis following the agreed merger with Borouge is set reduce OMV’s capital expenditures by around 3.5 billion euros until 2030.
OMV and the Abu Dhabi National Oil Company (ADNOC) announced in March the merger of their polyolefin business to create a $60 billion chemicals powerhouse. The merger is expected to be completed in the first quarter of 2026.
OMV also said it expected to reach total oil and gas production of 400,000 barrels of oil equivalent per day by 2030. In 2024, its daily hydrocarbon production was 340,000 barrels of oil equivalent.
Cash flow from operating activities is expected to exceed 6 billion euros by 2030. It had previously expected it to reach at least 7.5 billion.
($1 = 0.8575 euros)
(Reporting by Tristan Veyet in Gdansk, editing by Milla Nissi-Prussak)
