A memorandum of understanding to negotiate German Wintershall’s accession to Gazprom’s South Stream project was signed in Russia.
Wintershall, a gas producer and trader, is the gas subsidiary of German BASF, the world’s largest petrochemical concern.
BASF/Wintershall is one of Gazprom’s partners in the NordStream pipeline project on the Baltic seabed, in the Achimovskoye and Yuzhno Russkoye gas field developments in Siberia, and in joint marketing of gas with Gazprom in several EU countries including Germany. In that country, Wintershall helped pioneer the Gazprom-favored practice of asset-swapping, opening direct access for Gazprom to end-users.
Gazprom CEO Aleksei Miller and BASF Chairman, Juergen Hambrecht signed the MOU whereby Wintershall may acquire a 15% stake in South Stream’s pipeline section on the seabed of the Black Sea, subject to negotiations. Wintershall is expected to pay $2 billion for its stake. Gazprom retains its existing 50% stake intact.
In parallel, Electricite de France (EdF) has been negotiating to acquire a 10% stake in South Stream’s seabed section. Gazprom founded South Stream in 2007 as a 50-50 venture with Italian ENI. Any accessions to the offshore project by other parties correspondingly reduce ENI’s share while Gazprom’s remains intact.
Gazprom and ENI expect German and French interests to lobby in the EU For the project. The goal is to stop the EU Commission from enforcing EU law regarding Gazprom-controlled pipelines on EU territory.