Gazprom's deal with German petrochemical company BASF has not materialized due to political tensions. According to the Wall Street Journal, which refers to the press service of BASF, on December 18, the companies decided not to close the asset swap deal, which was planned to be done at the end of 2014.
Wintershall, a subsidiary of BASF, owns 50% of the joint venture with Gazprom - Achimgas - which already develops Achimov deposits of the Urengoy field. The company also owns 35% in the South-Russian deposit, as well as shares in the Nord Stream, South Stream and Opal pipelines. According to BASF, the joint venture of Gazprom and Wintershall will continue working.
At the end of 2012, Gazprom and BASF signed a legally binding basic agreement on the exchange of assets. On December 4, 2013, the European Commission approved the assets swap deal. The companies were intended to close the deal in late 2014.
Gazprom was hoping to gain access to end consumers in Europe by swapping assets with Wintershall, the Vedomosti reports. Under the agreement, Wintershall was to receive 25% plus one share in the two sites of the Achimov deposits in the Urengoy field. Gazprom was to increase its stake from 50 to 100 percent in Wingas, WIEH and WIEE - the companies that sell natural gas to Germany and other European countries.
Wintershall was to give Gazprom gas storage assets in Europe and a share in gas production in the North Sea. The deal was to be closed in the summer of 2014. In July, BASF announced that the deal would be postponed till autumn due to difficulties in legal registration.
The decision was made against the background of changes in gas relations between Russia and Europe, the Kommersant wrote. According to the publication, the European Commission was preparing the plan to set up an energy association of the EU. The plan is likely to be unveiled in January 2015. It contains new and important regulations concerning interaction with Europe's major gas supplier - Russia. It goes about new investment restrictions to Russian companies in the European energy sector.
European commissioners for energy, trade, industry and competition were ordered to develop a detailed program of purchases of imported natural gas in 2015. The current President of the European Council, Donald Tusk, is a big champion of the idea, although major players on the European gas market stand unanimously against centralized procurement of natural gas.
Four European commissioners are likely to be instructed to "discuss investment from companies of third countries, such as Russia, in the European energy market (infrastructure, distribution, gas supplies and electricity) in the context of energy security."
This regulation is directly aimed against Gazprom, which owns various transport and distribution assets in the EU. The company's involvement in sales could increase dramatically as a result of the asset swap deal with the German-based company BASF.
Gazprom has recently changed its approach to the acquisition of assets in Europe. After Russia refused to build South Stream gas pipeline to Bulgaria along the bottom of the Black Sea, the head of Gazprom, Alexei Miller, said: "Our strategy in relation to the European market is changing. In principle, the decision to stop South Stream marks the beginning of the end of our model of work on the market, when we focused on shipments to final consumers on the European market."
The approach of the European Commission to the gas relations with Russia has been getting more stringent; Russia's Gazprom has been changing its attitude to investment in Europe too. "The point of no return has not been passed yet, but the Y-track is clearly visible already. One needs to understand whether we remain strategic partners in the gas sector, or we're just trading partners," co-chairman of the EU-Russia advisory board for gas, Vladimir Feigin said.
On September 27, Nord Stream AG announced unprecedented damage that was caused to the company's two gas pipelines that run along the bottom of the Baltic Sea to Germany — Nord Stream and Nord Stream 2