31 October 2011, 17:53

Gazprom swaps assets with BASF

Gazprom swaps assets with BASF

The Russian gas giant Gazprom has made another step towards the further integration with its European partners. In Ludwigshafen, Germany, the Gazprom Head Alexei Miller and the Chairman of the Board of Directors of the BASF Concern Kurt Bock have signed an agreement on the asset swap.

The Russian gas giant Gazprom has made another step towards the further integration with its European partners. In Ludwigshafen, Germany, the Gazprom Head Alexei Miller and the Chairman of the Board of Directors of the BASF Concern Kurt Bock have signed an agreement on the asset swap.

This agreement provides for the possibility of a joint development by Gazprom and by the oil-and-gas company Wintershall, which is an 100 per cent BASF branch company, of the two sections of the Achimov deposits in Urengoi in Western Siberia. Gazprom’s German partners will receive 25 per cent plus one share. In its turn, the Russian side is due to acquire a 50 per cent stake in the Wintershall projects in the North Sea. There’re plans to start the joint development of the Wingate Deposit on the sea border of Britain and the Netherlands later this year. After the agreement was signed, the Gazprom Head Alexei Miller said that the cooperation between the two companies will make it possible to undertake more challenging and technically more difficult projects. Really, the Urengoi Deposit is the richest in the world and its development is possible only if the joint technological and economic potential of Russia and Germany is involved. About one billion cubic metres of gas is extracted there annually but there’re plans to increase extraction to 7 to 8 billion cubic metres in the future. Gazprom and Wintershall have been working in close cooperation for more than 20 years now, and their interaction is beneficial for both sides, the President of the Union of Oil and Gas Industrialists of Russia Gennady Shmal says:

"The merging of assets leads to the capitalization of companies, which, as a rule, is good for the two sides. And Gazprom is implementing a reasonable policy in this field."

The Director of the National Energy Institute Sergei Pravosudov said that it is a good example of cooperation between Russian and foreign businessmen:

"Gazprom is diversifying its resource portfolio. It gets assets, which are closer to Europe and to its main market. Thus, everybody receives what is good for them. I believe that relations with European companies should be built on this basis, and there will be no conflicts."

To give a boost to joint projects, Wintershall has set up a new department, which will be named “Russia”. Its office, which will be located in Moscow, will be headed by 40-year-old Mario Mehren. The North Stream gas pipeline is also the result of cooperation with Gazprom. This project has reduced the risks of gas supplies to Europe and has actually become a breakthrough in the integration processes between Russia and the European Union. Next in turn is the implementation of the South Stream gas pipeline project thanks to which gas will be transported to Southern Europe and Eastern Europe without any difficulty.

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