The Future of Energy (Part 4)
The Paris Agreement on Climate Change once again made climate protection and CO2 emissions a topic of global discussion. But measures to reduce CO2 emissions have not only been influencing our business since Paris.
How will climate protection affect our industry? And what do oil and gas companies have to do to remain successful in 2030? These questions are being discussed at length in our industry. We are using this as an opportunity to explore the issue of “The Future of Energy” in a series of blog articles. In Part 1 we explored “The IEA’s view on the Paris Agreement on Climate Change”, Part 2 explains how returning the focus to our core competency can mean a great step forward in the future. In Part 3 we looked into “Tomorrow’s mobility”.
This 4th and final part is a guest contribution by the pupils from Sperlgymnasium Wien, a grammar school in Vienna, who interviewed OMV CEO Rainer Seele on the issue of “OMV’s Energy Future” as part of the school project “Youth – Newspapers – Economy” by the IZOP Institute and the Austrian daily broadsheet Die Presse.
When you think about renewable energy, your first thought is of wind turbines and solar cells. But this is not the business that OMV will be pursuing.
“Let the future come”
OMV boss Rainer Seele is not afraid of the new energy era. After all, oil will continue to play a major role, while gas is even set to become more important in terms of power generation.
The new energy era is on everyone’s lips and one question that arises is how an energy giant such as OMV is preparing for this green future. Rainer Seele has a clear answer: “When you think about renewable energy, your first thought is of wind turbines and solar cells. But this is not the business that OMV will be pursuing”.
Whatever happens, OMV will remain true to its original business, while still adjusting its direction. The primary focus is on expanding the natural gas business. The plus point of this energy source is in its environmental credentials that clearly outstrip coal. In concrete terms, this means far lower C02 emissions per kilowatt hour of electricity, less soot and lower exhaust fumes. OMV thereby forecasts that with regard to power generation, natural gas will grow massively at the expense of coal. The natural gas industry also has good growth opportunities in the trucking sphere: “In this area E-mobility is far from capable of replacing diesel, what’s far more likely is a shift towards natural gas”, says the CEO of OMV.
In contrast, consumption of oil is likely to decline long-term. Crude oil will remain indispensable for the chemicals industry for an unspecified amount of time even when the production of fuel is undergoing a massive shift. Here, the major challenge is demand from the automotive sector – think E-mobility – that is set to decline in the medium term. “This change will be decisive in the refining sector in particular”, says Rainer Seele. Here the product range will change to such an extent that the so-called middle distillates, i.e. gasoline, heavy heating oil and diesel, will come under enormous pressure in the coming years. But even in terms of fuel, the OMV boss is optimistic: “For now, there is no technological alternative to aircraft fuel in sight and since tourism is a booming industry we expect additional higher growth rates in the future”.
For a long time, hydrogen has been the great hope of the future in terms of energy supply. And OMV has also bet on this horse: “Hydrogen continues to be a very appealing, environmentally sound fuel solution.That said, we are still lacking the market as the automotive industry is almost exclusively betting on E-mobility”.
In light of its commitment to its core business, in the future OMV will commit much more strongly to its value chain. When asked about this goal, Rainer Seele’s enthusiasm is hard to miss: “We have a real pearl in the company in the form of Borealis. The company is one of the three largest polymer producers on the planet and offers highly interesting opportunities for expanding our business”. But the familiar production of crude oil and natural gas, as well as the refining and pipeline business, will also have to increase significantly to meet these growth ambitions. The concentration on the most important resource sites in a few countries, come of which are the most politically unstable in the world, comes with its own challenges. For example, OMV is active in Russia or Libya. Rainer Seele addresses this issue: “Despite our commitment in the countries mentioned, 80 percent of our business is conducted in regions that are politically stable. Even when compared to our competitors, a relatively high percentage of our activities are in stable countries”.
Authors of this guest contribution:
Lisa Dorner, Jan Lenzbauer, Sherif Seleem (Sperlgymnasium Wien)
“Youth – Newspapers – Economy” – School project brings the economy to schools
The project “Youth – Newspapers – Economy” is a media and economic project by the Austrian daily broadsheet “Die Presse” and the IZOP Institute for learning in schools. Its goal is to enhance interest in economic issues in Austria’s schools.
The project aims to encourage pupils from 23 classes to get practical experience in exploring current economic issues, thereby gaining knowledge of economic structures and processes. Throughout their entire school year, pupils analyze the business section of the daily broadsheet “Die Presse”, choose topics to focus on and research the partner companies. They conduct interviews and finally write their own economic articles. Selected articles are the published in “Die Presse”. Educational support for the project is provided by Institut zur Objektivierung von Lern- und Prüfverfahren (IZOP) Aachen.
Project sponsors: OMV, Österreichischer Bankenverband, Verbund, Wiener Städtische Versicherung and Industriellenvereinigung.