BASF, Gazprom swap gas and marketing assets

By OGJ editors
HOUSTON, Apr. 27 -- BASF AG and OAO Gazprom have agreed to make a series of swaps of gas production and marketing assets.

BASF plans to acquire 35% interest minus one share in OAO Severneftegazprom, which holds the development license for Yuzhno-Russkoye gas field in western Siberia.

The agreement came as Russian President Vladimir Putin met with German Chancellor Angela Merkel in Tomsk, Siberia. Detailed agreements are expected to be finalized by yearend.

Last year, BASF subsidiary Wintershall AG and Gazprom agreed to jointly develop Yuzhno-Russkoye field (OGJ, May 2, 2005, Newsletter).

The field has reserves of more than 600 billion cu m of gas, three times the holdings of Achimgaz, a Siberian joint venture that Gazprom and Wintershall formed to develop gas from the Achimov horizon of Urengoy field.

Wingas
Gazprom will increase its interest in Wingas GMBH to 50% less one share from 35% now. In addition, Gazprom will participate in a Wintershall subsidiary with interests in exploration and production activities in Libya.

In line with Gazprom's increased stake, Wingas plans to focus on marketing gas in Germany. Gazprom and BASF also plan to participate with a 50% interest each in a new company, Wingas Europe.

BASF and Gazprom previously established the North European Gas Pipeline Co. joint venture, in which Gazprom has 51% interest and Wintershall has 24.5% interest. The company is to build the North European Gas Pipeline to transport Yuzhno Russkoye gas to Western Europe.

Last year, Wingas increased and extended its gas purchase contracts with Gazprom subsidiary OOO Gazexport through 2030, ensuring the sale of Russian gas to Germany and elsewhere in Western Europe.