OMV CEO says sees ‘difficult future’ for company in Turkey

OMV CEO says sees ‘difficult future’ for company in Turkey

OMV CEO says sees ‘difficult future’ for company in Turkey Turkey has developed into a headache for Austria’s OMV, which took a 205 million-euro hit on its Samsun power plant after several quarters of low profits, according to Reuters.

The company’s new chief executive, Rainer Seele, said he saw a “difficult future” for OMV in Turkey, especially for Samsun, according to Reuters report. 

The company, which owns Turkey’s biggest fuel retailer, Petrol Ofisi, operates two gas-fired power plants to generate power, one in Brazi, Romania, and the other in Samsun. Both power plants are the latest generation of 800 MW combined cycle power plants (gas and steam turbine power plants), according to the company website. 

OMV’s 870 MW plant was slated to commence operations in mid-2013, but the production license was cancelled by the Council of State three times due to environmental protection constraints that stemmed from the plant being constructed close to an urban area, according to several reports. 

“We booked 205 million euros this year as a provision against the profitability of the Samsun power plant following five or six successive quarters of very low margins, which have actually put us in a position in Turkey of not actually operating the plant for long periods of time,” company executives said Aug. 12, according to the transcripts of a conference call by the top executives to announce second-quarter results. 

Asked about potential asset swaps as part of OMV’s future dealings with Gazprom, Seele said it was too early to say, adding that he would not conduct a “summer sale.” He also ruled out the possibility that Gazprom would acquire a stake in OMV.

Gazprom in June said OMV was interested in its southern Turkish Stream pipeline project, but Seele told reporters OMV would focus on Nord Stream. 

“It’s for others to live out southern pipeline fantasies,” he said, as quoted by Reuters.