OAO Gazprom (OGZD) agreed to take over BASF SE (BAS)’s natural gas trading and storage in Europe as the Russian export monopoly seeks to maintain dominance over imports. Under a swap deal signed today, Gazprom will gain full ownership of trading ventures held with BASF’s Wintershall AG unit and storage in Germany and Austria, the companies said. BASF will gain stakes in Siberian projects, increasing output in the world’s biggest oil and gas producing nation. Gazprom, supplier of about a quarter of Europe’s gas, is seeking to hold onto its market share as the economic downturn and increasing competition cut its demand. This year, it provided price discounts to customers there, while in September the European Commission started investigating its pricing and supply policies in eastern and central Europe. “For Gazprom, the most valuable part is storage,� Alexei Kokin, an analyst at UralSib Capital in Moscow, said by phone. “It will help Gazprom meet its peak demand in Europe.� Gazprom will get half of Wintershall Noordzee BV, which operates projects in the southern waters of the North Sea, as well as full control of the Wingas, WIEH and WIEE trading units and storage, BASF said in a regulatory filing. Wintershall will get 25 percent plus one share in blocks 4 and 5 of the Achimov formation in the Urengoy field in Siberia and has an option to raise its stake to 50 percent. U.K., Belgium Subject to approval by “relevant� regulators, the deal will be completed by the end of 2013 and financially retroactive to April 1, 2013, BASF said. Wingas holds about 20 percent of the German gas-supply market and operates in Belgium, Denmark, France, the U.K., Austria, the Netherlands and Czech Republic, according to its website. Kokin said he questions whether German authorities will approve the deal. Gazprom and Wintershall agreed on the asset swap last year, without the stakes in the trading businesses. Wintershall works with Gazprom at a separate Achimov gas project and at the Yuzhno-Russkoye field. It is also a partner in Gazprom’s Nord Stream pipeline to Germany and the planned South Stream link. Wintershall’s production is set to rise to at least 160 million barrels of oil equivalent by 2015, supported by today’s deal, from 140 million barrels of oil equivalent this year. Cold Snaps Achimov blocks 4 and 5 will add 2.4 billion barrels of oil equivalent to Wintershall’s resources, according to BASF’s statement. The blocks may produce at least 8 billion cubic meters at plateau, with output expected to start in 2016, according to the statement. Gazprom aims to use underground storage in Europe in case of cold snaps after the gas exporter rejected requests from European partners to raise supplies early this year. “We will continue our successful activities to ensure reliable supplies to Europe by increasing our share in gas trading and storage companies,� Gazprom Chief Executive Officer Alexey Miller said in the company’s statement. To contact the reporter on this story: Anna Shiryaevskaya in Moscow at ashiryaevska@bloomberg.net To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net

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