CORRECTED-UPDATE 1-OMV shuns further deals as CEO sees bright future in chemicals

(Corrects to say Borealis’ cash flow rose 6% yr/yr in last para)

* OMV invested $4.7 bln in plastics specialist Borealis

* Other European oil firms focus on green power

* OMV CEO bets on counter-cyclical deals

LONDON, Dec 18 (Reuters) - Austria’s OMV will not make acquisitions before 2022 while it cements its transition into a chemicals group which increasingly uses less crude oil as feedstock, its chief executive said, diverging from other European oil and gas firms focusing on renewables.

OMV in October completed a $4.7 billion acquisition of a majority stake in Borealis, which makes speciality plastics and materials. Meanwhile, BP in June sold its petrochemicals business for $5 billion.

While other oil and gas companies like BP or Royal Dutch Shell are turning themselves into broad energy providers and traders buying into renewable power development projects, OMV has shunned such investments.

“Do I understand the power market better than Eon or RWE? Definitely not. When I look into my transformation into chemicals, I can tell you, I have lots of competitive advantages,” Chief Executive Rainer Seele told Reuters on Friday.

“Borealis is a technology leader with the Borstar technology (to make polyethylene and polypropylene)... They have the in-house technology, they are not licensing it out.”

OMV also aims to lead the market in turning plastic waste into oil and increasing the bio-feedstock content for its refineries.

It sold its German petrol station network this month for around $590 million as its bigger European rivals doubled down on their retail networks.

“Anti-cyclical decisions are sometimes very brave and successful,” Seele said, asking why should he sell products other refiners make given OMV’s German refinery focuses on petrochemicals and jet fuel production.

While BP and Royal Dutch Shell had to cut their dividends this year, OMV has kept payouts steady and Seele said he expected operating cash flow to rise in the fourth quarter.

Borealis’ cash flow rose 6% in the first three quarters of 2020 from a year earlier.

Reporting by Dmitry Zhdannikov and Shadia Nasralla; editing by David Evans and Susan Fenton