Gazprom and Wintershall Sign Framework Agreement for Asset Swap
Today (October 28, 2011) a framework agreement which sets out the terms for the planned asset swap to further expand the successful cooperation has been signed in Ludwigshafen by Alexey Miller, Chairman of the Management Committee of OAO Gazprom, and Dr. Kurt Bock, Chairman of the Board of Executive Directors of BASF SE.
According to the agreement, two further blocks of the Achimov formation of the Urengoy field in western Siberia will be developed by the two companies. Wintershall, a wholly owned subsidiary of BASF SE, will initially hold a working interest of 25 percent plus one share in the development of blocks IV and V. Wintershall retains the option of increasing this shareholding to 50 percent. The framework agreement stipulates that Gazprom will receive interests of equal value in selected exploration and production projects by Wintershall in the North Sea (Netherlands, UK). Gazprom will ultimately receive half of Wintershall’s shares in these concessions.
“The joint production between our oil and gas subsidiary Wintershall and Gazprom from the Achimov deposit is an impressive example of our long-standing success model: cooperation in the spirit of partnership and complementing each other’s strengths along the entire value adding chain. Further expanding our shared production is an important step in our partnership with Gazprom, which stretches back over 20 years,” said Dr. Kurt Bock. “The constructive partnership between Gazprom and BASF/Wintershall enables us to tackle technically complex and ambitious projects. Together with Wintershall, we want to expand gas production from the Achimov layers of the Urengoy deposit and cooperate in E&P projects in the southern North Sea, where Wintershall has been operating successfully for decades, for our mutual benefit,” said Alexey Miller.
The cooperation between BASF subsidiary Wintershall, Germany’s largest producer of crude oil and natural gas, and Gazprom, the world’s largest producer of natural gas extends from the exploration and production of natural gas in West Siberia to transportation through the Nord Stream pipeline and the sale of the natural gas in Germany and Europe by the jointly owned natural gas trading company WINGAS. With the existing Siberian production operations in Novy Urengoy and Yuzhno Russkoye, BASF and Gazprom already help to secure Europe’s energy supply together.
Source: basf, October 28, 2011; Image: wintershall