BASF runs into upstream while Gazprom goes west
The assets selected to support the swap reflect the strategy of both companies:
– BASF to increase its position in the oil and gas exploration and production
– Gazprom to expand its midstream global footprint in western Europe.
Wintershall will take 25% plus one share of the blocks IV and V in the Achimov formation of the Urengoi field located in western Siberia.
Wintershall will have the option to increase its shares up to 50% in these blocks.
The Achimov formation is liquids rich natural gas field containing:
– 274 billion cubic meter of natural gas
According to the agreement signed between BASF and Gazprom, Wintershall and Gazprom will jointly develop the Achimov formation blocks considering that both companies are already cooperating in the projects Yuzhno Russkoye and Achimgaz in Russia.
Wintershall as cornerstone of BASF – Gazprom swap
Russia and northern North Sea are the targeted areas where Wintershall wants to grow as it is in this harsh environment it sees the best opportunity to differentiate its expertise to produce more from a given asset.
Therefore Gazprom receive remaining 50% shares of:
– WIEH (Wintershall Erdgashandelshaus Berlin)
– WIEE (Wintershall Erdgashandelshaus Zug)
– Rehden and Jemgum storage facilities in Germany
– Haidach storage facilities in Austria
– Astora gas storage operator
With this transfer Gazprom increases its interest in western Europe, one of its most critical market at a period Germany may need more and more gas to substitute its nuclear and coal-fired power plants.
For BASF and Wintershall this cooperation and swap operation with Gazprom will help to consolidate their market leadership in complex oil and gas fields where their EOR expertise boosts oil and gas recovery rates.