Wintershall loses interest in Urengoi Achimov deposits due to NRET hike - Gazprom
MOSCOW. Oct 3 (Interfax) - BASF/Wintershall thinks the project to develop the fourth and fifth Achimov beds at the Urengoi gas field is now uneconomical in light of natural resource extraction tax (NRET) hikes and has lost interest in it, a Gazprom manager said in the Federation Council.
"The chief executive of BASF has written to Russian President Vladimir Putin saying that the project is becoming unprofitable following the NRET hike and that the company is losing its incentive go participate in it," said Karen Oganian, head of Gazprom's Tax Policy Department.
Oganian told journalists this does not mean that BASF will no longer take part in a planned asset swap. "This isn't the case. The project will certainly be implemented. We hope that [it happens] with partners. But, there's definitely tension," he said. Oganian added that dissatisfaction on the part of the foreign partners (BASF and E.ON) at the Yuzhno-Russkoye field is growing because of the changing tax terms, which reduces profitability.
Wintershall has been Gazprom's partner in test production of Achim layers at section 1A at the Urengoi field. Production has been underway since 2008. Negotiations are also underway for partnership at the fourth and fifth Achim sections at the field. It was earlier reported that Gazprom is ready to present Wintershall these sections in exchange for projects in the Dutch and British sectors of the North Sea. The two companies planned to sign a binding agreement for an asset swap in November.
BASF's supervisory board should approve the terms for the asset swap with Gazprom in November.
