OMV and Borealis celebrate joint investment in Austria

• Borealis upgrades its European assets: inauguration of a 350,000 tonnes per year Borstar® polyethylene plant and expansion of an existing  Borstar polypropylene plant from 210,000 to 300,000 tonnes per year in Schwechat (Austria)
• OMV and Borealis follow their integrated feedstock-olefins-polyolefins strategy: expansion of OMV (35% owner of Borealis) cracker in its Schwechat refinery  to 900,000 tonnes per year
• Borealis demonstrates its commitment to Value Creation through Innovation: this investment increases Borealis’ usage of Borstar proprietary technology to more than a million tonnes per year
• Schwechat becomes a leading location in European plastics industry: EUR 400 million joint investment by OMV and Borealis

More than a thousand customers, academics, politicians, bankers, journalists, suppliers and employees joined OMV and Borealis, in Schwechat, at the inauguration of a new 350,000 tonnes Borstar® polyethylene plant, the expansion to 300,000 tonnes of the Borstar polypropylene plant and the expansion from 650,000 to 900,000 tonnes per year of OMV’s nearby cracker.  The occasion will be marked with a futuristic multimedia celebration under the theme, ‘The Bridge: The journey from oil to plastics’. This joint EUR 400 million investment turns the OMV/Borealis Schwechat location into one of the largest plastics manufacturing sites in Europe with 900,000 tonnes per year production by OMV and more than a million tonnes per year for Borealis.  

The construction of the OMV and Borealis plants and cracker began early 2004 and the start-up was according to plan in the Autumn of 2005. The EUR 200 million investment by OMV to upgrade its cracker extends OMV ethylene capacity by 150,000 tonnes to 500,000 tonnes per year and its propylene capacity by 100,000 tonnes to 400,000 tonnes per year. These basic petrochemicals products are delivered by pipeline to neighbouring Borealis plants and used in manufacturing advanced polyethylene and polypropylene plastics. The new Borstar PE plant has enabled Borealis to capture the growing demand for linear low-density PE for enhanced, differentiated film products, for flexible consumer packaging and industrial applications in particular.

Gerhard Roiss, Deputy CEO of OMV and Borealis Chairman of the Board, says: “The joint EUR 400 million investment is the largest single investment ever made in that location and will both strengthen and consolidate the competitive position of Schwechat as a European petrochemical centre. Our refinery products go into mobility and materials. This investment into plastics reflects our increasing emphasis on sustainable business. The synergy of these investment projects is a good example of the successful integration between OMV and Borealis.”

John Taylor, Chief Executive, Borealis says: “This inauguration is a major event for Borealis as it clearly demonstrates the continued pursuit of our Value Creation through Innovation strategy. Our Central European hub plays a key role in the implementation of this strategy with the international innovation centre in Linz and now an increased Borstar capacity in Schwechat. I am confident that this strategy will enable us to continue to anticipate our customers needs internationally and develop partnerships for new plastics solutions.”

View the inauguration press conference webcast (74 minutes)

OMV Aktiengesellschaft With Group sales of EUR 15.6 billion and a workforce of 5,226 employees in 2005, as well as market capitalization of approx. EUR 13 billion, OMV Aktiengesellschaft is Austria’s largest listed industrial company. As the leading oil and gas group in Central Europe, OMV is active in Refining and Marketing (R&M) in 13 countries. In Exploration and Production (E&P) OMV is active in 18 countries on five continents. In the Gas business segment OMV has storage facilities and a 2,000 km long pipeline system, transporting 45 bcm of natural gas annually to countries such as Germany and Italy. OMV holds stakes in integrated chemical and petrochemical plants – 50% in AMI Agrolinz International GmbH and 35% stake in Borealis A/S, one of the world’s leading producers of polyolefin. Other important holdings are: 51% of Petrom SA, 50% of EconGas GmbH, 45% of the BAYERNOIL refining network and 10% of the Hungarian company MOL.

In June 2006, OMV has established the OMV Future Energy Fund, a wholly owned subsidiary to support projects in renewable energy with more than EUR 100 Mio to initiate the change from a pure oil and gas group to an energy group with renewable energy in its portfolio.

With the acquisition of a majority stake in the Romanian Petrom, OMV has become the largest oil and gas group in Central Europe, with oil and gas reserves of approx. 1.4 billion boe, daily production of around 330,000 boe and an annual refining capacity of 26.4 million metric tons. OMV now has over 2,520 filling stations in 13 countries. The market share of the group in the R&M business segment in the Danube Region is now 20%.

OMV further strengthened its leading position in the European growth belt through the acquisition of 34% of Petrol Ofisi, Turkey´s leading company in the retail and commercial business.

For more information please contact:

Bettina Gneisz
+43 1 40 440 21660
bettina.gneisz@omv.com

Thomas Huemer
+43 1 40 440 21660
thomas.huemer@omv.com

Craig Halgreen
Borealis Director Communications
+43 1 224 00 334
Craig.Halgreen@borealisgroup.com

Daniela Scharer
Borealis Central Europe Community Affairs
+43 170111 4247
Daniela.Scharer@borealisgroup.com