Climate Change and Energy Transition

We recognize climate change as one of the most important global challenges today and acknowledge the goals set forth by the Paris Climate Change Agreement. OMV Petrom is fully committed to climate change mitigation and responsible resource management. We are the first Romanian company supporter of the Task Force on Climate-related Financial Disclosures (TCFD). We set targets to manage and reduce the carbon footprint of our operations. Reducing greenhouse gases will decrease our environmental impact and have a positive financial impact by ensuring compliance with climate-related regulatory requirements and ensuring the efficient use of resources.

Climate change

OMV Petrom commits to doing business economically, ecologically, and socially sustainably. We will continue to uphold this commitment as it is the only way to protect and preserve security and prosperity in the long term. More people need more energy. At the same time, the planet is getting warmer, making climate protection increasingly important.


Therefore, we are transforming our business model step by step to reduce the carbon footprint of the Company.


OMV Petrom takes climate actions related to its operations, product and service portfolio, innovations and R&D activities, working environment, and social investments. OMV Petrom is fully committed to climate change mitigation and responsible resource management and has consequently set targets to manage and reduce the carbon footprint of its operations and product portfolio. In 2020, OMV Petrom met its set-up carbon targets. We also analyzed the opportunity to establish new carbon targets in line with those at the OMV Group level, which is committed to the Paris Agreement (keeping the increase in global average temperature to well below 2 °C above pre-industrial levels) and the EU climate targets, pledging for the first time to become carbon neutral operations by 2050.

OMV Petrom S.A. is scored A – in the CDP Climate Change Program based on the response of OMV Group in 2020.

Climate Change Risk Management

Climate change risk management supports OMV Petrom’s efforts to act as a dedicated company to sustainable business practices. As an energy company, we are committed to contribute to Romania’s transition to a low-carbon economy.


Climate-change-related risks and opportunities are integrated into OMV Petrom ’s Enterprise-Wide Risk Management (EWRM) process aimed at identifying, assessing, and managing business-related risks. The short- and medium-term risks are analysed for their impact on the Company’s three-year financial plan. The effects of long-term risks are evaluated based on qualitative analysis, taking into account a wider range of uncertainty. Climate-related risks and opportunities have already impacted our business plans and objectives in the medium term. The most substantial climate-related changes in the oil and gas industry are expected to arise on a longer time scale, in particular with regards to revenues. Therefore, management pays close attention to climate-change-related long-term risks and opportunities and takes these into account in the strategic decision-making process. Risks are identified on a daily basis in a bottom-up approach by all employees and in a top-down approach by the corporate units responsible for monitoring regulatory, market, and reputational risks in line with the latest national and international developments. These risks are assessed in terms of their potential impact on the medium-term financial performance plan. In the bottom-up approach, climate change-related risks are identified using the standardized methodology of the EWRM process.


Being the first Romanian company to support the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD), OMV Petrom considers and addresses climate change-related risks according to TCFD recommendations, as well as the double materiality perspective proposed by the EU Non-Financial Reporting Directive. These new approaches have been implemented in OMV Petrom starting the second half of 2020, gradually throughout the organization, as follows:

Physical risks

Potential severe weather events like flooding, landslides, periods of low or no precipitation and storms could bring physical risks that impact our assets portfolio, such as railway infrastructure damages, inability to access water for the normal operations (internal consumption). Potential financial impact has been estimated based on assumed business interruption in OMV Petrom Upstream and Downstream as generating loss of revenues of approximately EUR 60 mn.

Transition risks

Potential future restrictions on the carbon intensity of feedstocks, political and security risks in the countries of origin of our feedstock, and any other supply limitations pose a threat to the refinery feedstock supply. There is a risk of imbalance between certificates allocated and Company-required emissions volumes, resulting in higher costs generated by the uncertainties about the allowance demand and abatement costs. Current and emerging regulations in line with international public-sector initiatives, such as the Paris Agreement, and their subsequent transposition into Romanian national regulations would result in limits set on GHG emissions by the energy sector. This process of decarbonisation will change the energy mix and will lead to a reduced demand for fossil fuels with a high carbon content.


There is a risk that demand for refined fuels may decrease due to less carbon-intense substitute products coming to the market. Emissions regulations, energy efficiency regulations, and regulations on the increased share of renewables in the energy mix are expected to result in a decrease in gasoline and diesel production in accordance with European regulation so as the new car registration trends towards gasoline and battery electric / hybrid cars, as well as to a decrease in the production of our heavy products.


Reputational risks stem from the increasing number of investors who assign a company’s environmental and social responsibilities a high weight in their investment decision-making process. This can be for reasons of internal policy or due to regulatory pressure for public investment transparency regarding sustainability issues.

Transition opportunities

Decarbonization will create opportunities for OMV Petrom based on the increased demand for lower- or zero-carbon fuel (e.g., natural gas, CNG, LNG, hydrogen, biofuels, e-mobility). Further details will be provided with the Strategy update planned in the second part of the year.

Scenario Analysis

Scenarios consistent with the goal of limiting the global temperature increase to no more than 2 °C by reducing greenhouse gas emissions are of utmost importance for our strategic considerations as they imply fundamental changes to the current energy market. We are aware of the potential risk of stranded assets if we cannot fully exploit our reserves due to surpassing the global carbon budget. During the strategy development and planning processes, OMV Petrom has taken into account scenarios reflecting various aspects of potential economic, technological, and social developments and their implications for the energy market and, consequently, for our business.


OMV Petrom currently still uses the International Energy Agency (IEA) Stated Policies (STEPS) Scenario, given that it incorporates current and announced policies, targets, and plans. Based on the IEA STEPS Scenario, we projected the development of the oil and gas demand in Europe and in the OMV Petrom core markets up to 2025. In general, according to the IEA STEPS Scenario, changing demand will lead to a less carbon-intensive fuel mix.


In comparison to the IEA STEPS scenario analysis, the IEA Sustainable Development Scenario (SDS) was used by OMV Petrom as a downside sensitivity to generally understand how the existing and future OMV Petrom portfolio performs in such a business scenario. The SDS charts a path fully aligned with the Paris Agreement by holding the rise in global temperatures to well below 2 degrees Celsius and meets objectives related to universal energy access and cleaner air. Considering the CO2 price from SDS scenario for the year 2040 (122 EUR/t) and the CO2 emissions of OMV Petrom at 2020 level (3.57 mn t) we can estimate a cost of EUR 436 mn for our CO2 emissions.

Climate Change Materiality Map

Address the most critical aspects of energy transition, in 2020 OMV Petrom has undertaken a materiality assessment of the most relevant transition issues.


The materiality of climate change-related risks confirms that the two most important climate change issues for the Company and its stakeholders are increasing stakeholders’ pressure on climate change disclosure and the stigmatisation of Oil and Gas sector. Next in line are issues such as emerging low emission regulations and increasing pricing of GHG emissions.

Carbon efficiency of operations

Reducing emissions from operations is an important strategic target for OMV Petrom, demonstrating our commitment to this material sustainability topic. Our carbon efficiency agenda focuses on process optimization and modernization, energy efficiency, using renewable electricity, and delivering projects that reduce gas venting and flaring. Management of carbon efficiency in operations is incorporated into the sustainability governance process, as described in the OMV Petrom Sustainability strategy chapter.

OMV Petrom decreased the GHG Intensity of its operations by 26% in 2020 vs.2010.

This proves our efforts to achieve our strategic target of decreasing the GHG Intensity by 27% by 2025 vs. 2010. In 2020, the overall OMV Petrom’s GHG Intensity decreased by 7.5% vs. 2019 for the entities in the scope, as follows: Upstream’s Assets decreased by 24.3%, Petrobrazi refinery increased by 4.1% and Power Plants (Brazi Power Plant and Petrom City Power Plant) decreased by 0.5%.


Upstream continued measures to reduce GHG emissions. In 2020, our actions resulted in a significant reduction of venting and fugitive methane emissions thanks to modernization, replacement and/or optimization of gas processing and transportation infrastructure. Examples include:

► Shutdown Compressor Station 10GK Bustuchin

► Install G2P in Icoana – Asset Muntenia Vest

► Rehabilitation/replacement of main gas pipelines in Muntenia Vest.

► Operational measures in Asset Muntenia

► Leak Detection and Repair program in all Assets and Green Kaizen events.


An important contribution was also the setup of a dedicated Carbon Management Program team with focus on three main areas (2020 onwards): carbon portfolio development, performance management, people awareness and mindset, analytics and digitalization.


As part of the Energy Efficiency Program in Upstream, we continued to develop projects to obtain electricity (gas to power – G2P) or electricity and useful thermal energy (Cogeneration or Combined Heat and Power – CHP) out of gas in Upstream. In 2020 we have finalized G2P Icoana and G2P Țintea Phase 2 and initiated other two new G2P projects (Asset Muntenia Vest – G2P Oarja and Asset Muntenia – G2P Baicoi Vest). We managed to ensure between 61% and 66% of the annual electricity consumption of our Upstream business and important production cost savings through such projects.

Our 860 MW Combined Cycle Power Plant (CCPP) located in Brazi is equipped with state-of-the-art emission reduction equipment that enables it to rank below the EU CO2 emissions average. The Brazi power plant had a net electricity production of 4.15 TWh compared to 3.38 TWh in 2019, representing 7% of Romania’s electricity production, supported by positive margins; the power plant also contributed to the balancing market and ancillary system services, supported by its technical capabilities. Replacing lignite-fired power plants with gas reduces CO2 emissions with minimum 50%. For example, our CCPP produced 1.535 mn t of GHG emissions in 2020. If it were lignite-fired, it would have produced 3.968 mn t of GHG emissions instead. In 2020, the power production increased by 0.796 TWh, and the GHG intensity decreased by 0.51%. The power plant in OMV Petrom City increased the thermal and electricity production by 1.96% in 2020 vs. 2019, in line with consumption needs.

New Compressor Station 2 Bustuchin in Upstream, Asset Oltenia - promoting modernization

The Project related to “Shutdown of Compressor Station 10GK Bustuchin” was developed in OMV Petrom Upstream, Asset Oltenia, between 2017 and 2020 with around EUR 5 mn investment. The scope consisted of installing four new two-stage electrically driven compressors and related auxiliary equipment, replacing the former compressor station 10GK Bustuchin, which had been operating since 1989. By having a new facility in place, referred to as Compressor Station 2 Bustuchin, the operational and integrity risks were reduced significantly. Therefore, the gas compression system downstream to Hurezani Panel was optimized, resulting in a direct GHG emission reduction of around 18,500 t CO2.

SDG 9 Target: 9.4 By 2030, upgrade infrastructure and retrofit industries to make them sustainable, with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies and industrial processes, with all countries taking action in accordance with their respective capabilities.

Direct GHG Emissions (Scope 1)

In 2020, OMV Petrom’s carbon dioxide (CO2), methane (CH4), and nitrous oxide (N2O) emissions levels directly related to our operations (Scope 1) totalled 3.99 mn t CO2 equivalent and was relatively stable comparing with previous year (2019: 4.24 mn t CO2 equivalent). The scope of direct GHG emission cover all operated Assets and those with more than 50% stake, excluding the filling stations of which contribution is marginal.


We are subject to the EU Emissions Trading Scheme (EU ETS). Five of our operating installations were under EU-ETS at the end of 2020. Around 67% of our direct GHG emissions come from these EU-ETS installations and are externally verified by an accredited company, according to the relevant legislation.


Indirect GHG Emissions (Scope 2)

OMV Petrom’s indirect GHG emissions (Scope 2) are those related to the production of the energy we purchased (electricity and heat) for our operations. In 2020, our indirect GHG emissions totalled 0.094 mn t CO2 eq. (2019: 0.045 mn t CO2 eq.). The increase of indirect GHG emissions was mainly due to the extended scope with filling stations of which contribution amounted to 0.038 mn t CO2 eq.

Our Scope 2 emissions are primarily caused by the Upstream and Downstream Business Segments, both of which are energy-intensive.

See more in “Peformance in detail

Indirect GHG Emissions (Scope 3)

In 2020, our Scope 3 emissions were 24.74 mn t CO2 equivalent (2019: 26.06 mn t CO2 equivalent) and are related to the total product sales volumes of Petrom as stand-alone company. Around 94% of OMV Petrom’s products are directly used for combustion. The Scope 3 emissions from the use and processing of our products constitutes around 86% of our impact in terms of GHG emissions. The development of low-carbon products and new energy solutions to reduce this major impact is therefore in our focus to address the Climate Change and Energy Transition.


Flaring, Venting and Fugitive Emissions

Phasing out routine flaring is one of the essential steps towards combining resource efficiency with long-term economic success and a way to strongly support our efforts to reduce our operations’ carbon footprint. In 2020, OMV Petrom routine flaring was 20.32 mn m3 To reinforce our aim to responsible resource management and sustainable business, we committed to phasing out routine flaring according to the World Bank global initiative “Zero routine flaring by 2030”, endorsed by the OMV Group.

See more in “Peformance in detail

New OMV Petrom oil and gas fields are developed and operated according to plans that incorporate sustainable utilization or conservation of the field’s associated gas without routine flaring. Existing sites where routine flaring of associated and free gas still takes place are required to develop a phase-out plan to eliminate legacy routine flaring as soon as possible, but no later than 2030.


Many activities and projects to stop or reduce routine flaring have already been implemented or are ongoing, such as the Energy Efficiency Program in Upstream. In the Petrobrazi refinery, optimal plant design is implemented to minimize flaring events by balancing the fuel gas system. Such advanced process control includes enough capacity of the flare gas recovery system, the use of high-integrity relief valves, and other economically viable organizational and control measures. As a result of such measures, we aim to use flaring as a safety system for other than normal operations, such as start-up, shutdown, emergency, process upsets, etc.


All OMV Petrom’s operations are required to minimize methane emissions from point sources as well as fugitive emissions and technically unavoidable emissions (such as well testing and well workover, among others). The main sources of methane emissions are routine/non-routine venting of gas during oil and gas production and processing as well as gas leaks.


To prevent and mitigate fugitive emissions, important steps have been taken, such as a pipeline integrity program and compressor station modernization (modernization of facilities) in Upstream and a Leak Detection and Repair (LDAR) Program in both Upstream and Downstream. An LDAR Program includes two fundamental steps, namely identification of the leaking components and repair of these leaks in order to minimize losses. This program serves as the basis for developing reduction projects in accordance with best practices in the industry and the best available technologies.


Upstream significantly reduced the hydrocarbon vented to 16,155 t in 2020, meaning a reduction of 52% comparing to 2019. Among the contributing measures are the Green Kaizen Events as well as improving and optimizing the gas infrastructure (e.g., replacement of Helvet 20” pipeline and closing of 10 GK Barbateşti Compressor Station in Asset Oltenia, new gas pipelines at Mihaeşti and Merişani in Asset Muntenia Vest, relining of gas pipelines grid Boldeşti, capital repairing of Park 1125 Buştenari and increase of gas capacity for Compressor Station 9 Moreni in Asset Muntenia).


In Downstream Oil, the Petrobrazi refinery implemented an LDAR Program according to BAT-BREF (Best Available Techniques – Reference Documents). The program’s objective is to reduce fugitive emissions from the plant’s technological equipment (e.g., vents, flanges). In 2020, the Program targeted accessible fugitive emissions sources from Tank Farm and well as Fluid Catalytic Cracking and Gascon Plant.


The program also covered the screening of inaccessible sources, where no leaks were detected. The measurements were performed by using the Optical Gas Imaging (OGI) method, which involved an advanced hand-held infrared camera specifically developed for this purpose. All leak sources, with a concentration above the repair definition (threshold), underwent repairs in 2020. This program runs periodically, according to a schedule, in all Petrobrazi installations.

SDG 13 Target: 13.3 Improve education, awareness-raising and human and institutional capacity on climate change mitigation, adaptation, impact reduction and early warning.

Green Kaizen Events in Upstream - minimizing fugitive emissions

In Upstream, we deployed a LDAR Program in all Assets, as part of Green Kaizen Events in 2020. The aim is to repair all leaks identified while enabling a low-carbon operational behavior among field personnel and local contractors. The Green Kaizen Events consist of five main activities: leaks identification, volumetric measurement of fugitive gas leaks, leak repairs, post-repair measurement in repaired sources and the assessment of results. These activities aim to set the employees’ minds to see the problem, understand the problem’s size, implement the solution, confirm the solution, and sustain the result. In 2020, we managed to decrease the fugitive emissions through two Green Kaizen Events at large facilities of Crișana and Oltenia Assets. We intend to continue this in all operated Assets, incorporating lessons learned and best practices to ensure maximum reach of set objectives.

Energy use and renewable energy

As an integrated oil and gas company, OMV Petrom operates large facilities and is also a major energy consumer. Energy and climate change issues are of interest to stakeholders including:

► Governmental authorities: compliance with EU Emissions Trading System (EU ETS) regulations relating to the submission of emissions allowances within EU ETS, compliance with the EU Energy Efficiency Directive requiring greater energy efficiency in all stages of the energy value chain.

► Shareholders and other stakeholders with a direct financial interest in OMV Petrom: financial savings resulting from reduced energy consumption, lower production costs, and lower GHG emissions.

► NGOs/NPOs: reduced impact of our operations on the environment.

The OMV Petrom Group Environmental Management Standard requires that all businesses use energy responsibly, conserve primary energy resources, and implement energy management plans in accordance with ISO 50001. In 2020, we held valid certifications of the Energy Management System according to ISO 50001 for OMV Petrom S.A. and OMV Petrom Marketing. Our Energy Management System which is certified according to ISO 50001 covers around 60% of Petrom Group’s employees.


Energy efficiency requires major interventions for reducing greenhouse emissions by reducing energy consumption. In this regard, OMV Petrom signed a strategic partnership with the Energy Policy Group (EPG) on an energy efficiency initiative “România Eficientă.” This is a unique initiative in Romania, aiming to create a culture of energy efficiency in the building sector.


Effective management of energy consumption reduces the environmental impact and environmental cost of our operations, increases financial savings thanks to energy efficiency, prevents non-compliance with regulatory requirements on energy use, and mitigates the climate effects of GHG emissions.


In 2020, our total energy consumption was 43.9 PJ (2019: 43.1 PJ).


The Petrobrazi refinery embarked on a long journey towards a high energy efficiency performance confirmed by participating to a well-known benchmarking provider for Fuels Studies, known as Solomon. Based on the benchmarking studies, energy efficiency programs are defined for the ongoing year as well as long-term targets to be among the top performers of energy efficiency. To this end, we explored approaches and solutions enabled by the latest digital technology to significantly enhance the energy intensity index performance in a more complex global economy.


The solution would require a multiphase approach for OMV Petrom to progressively define, measure, analyze, improve and control its energy performance management using methods supported by technologies to transform its energy performance management. In 2020 we went further to implement a pilot project regarding Energy Management Solution (EMS) for the Crude Distillation Unit at Petrobrazi, which is an analytics software solution that provides industrial companies with real-time data, visual intelligence and actionable recommendations to help them optimize production and increase profitability.


The project identifies operational scenarios, overdue maintenance activities and unit design constraints that cause ineffective energy consumption to reduce CO2 emissions and energy costs. The results from the Energy Management Solution’s reports provide an objective measurement of both expected and some unexpected loss sources. A user can evaluate the current energy efficiency and associated emissions on-demand.


Energy efficiency measures are closely linked with technical improvements and process optimization directed at reducing energy use while achieving the same operational output and also linked with GHG emissions reduction (for more information, see Carbon Efficiency in Upstream and Downstream).


In the retail business, we continued to install photovoltaic cells and reached a total number of 82 filling stations at the end of 2020. Thus, over 10% of the energy consumption of those locations is covered by renewable energy. The total number of photovoltaic cells produced 2.345 MWh and the total investment amounted to EUR 2.1 mn. We also initiated a pilot project for Micro cogeneration (simultaneous production of electricity and heat in the same process from a primary energy source – natural gas) in OMV Cluj Mărăști filling station. This pilot project is under evaluation for one year, then analysis of results and decision for further implementation.

Our 2025 sustainability target► Reduce OMV Petrom’s carbon intensity of operations by 27% until 2025 (vs. 2010).
► No new projects with routine flaring and venting and phase out existing routine flaring and venting until 2030 at the latest.
Status 2020► Reduced the GHG Intensity of the operations by 26% in 2020 vs. 2010.
► Developed Report on GHG performance.
► No new project with routine flaring and venting in 2020.
► Continue implementing projects to phase out routine flaring and venting by 2030.
Action plan to achieve the targets► Phasing out routine flaring and venting in Upstream.
► Energy efficiency improvements in Upstream and in the Petrobrazi refinery.
► Fugitive methane emissions reduction through process optimization, field modernization, and integrity improvement measures in Upstream.

Sustainable Development Goals (SDGs) supported