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Gazprom strikes deal on European gas hub in Austria - extended

Russia’s state-run gas giant Gazprom and OMV, an Austrian oil and gas company, signed a cooperation agreement in Vienna to set up a gas trading platform and storage facility in Europe.

The agreement signed by Alexander Medvedev, deputy chairman of the Gazprom management committee, and Wolfgang Ruttenstorfer, OMV’s CEO, will give Gazprom a 50% stake in one of the largest gas hubs in Europe - the Central European Gas Hub (CEGH) in Baumgarten, Austria. “The agreement signed with OMV is a substantial contribution to securing natural gas supplies to Europe,” Medvedev said. OMV Gas International deals with the group’s activities in the natural gas sector and is focused on marketing, trading and logistics. The CEGH in Baumgarten was established as a logistical and commercial trading platform by OMV and has a capacity of 1.3 billion cubic meters per month. The agreement is based on the Memorandum of Understanding signed in May, 2007 by Ruttenstorfer and Alexei Miller, Gazprom CEO, during a visit to Austria by Russian President Vladimir Putin.

OMV and Gazprom will sell gas to Germany and Italy through the Baumgarten hub, located on the Austro-Slovak border near a trunk pipeline from west Siberia’s gas fields. Both companies also want to use Baumgarten as the distribution hub for pipelines they’re planning to build via the Balkans to Central Europe. The OMV-led Nabucco link is intended to diversify the European Union’s gas supplies by tapping into gas from the Caspian region via a pipeline from Turkey through southeast Europe. South Stream, a joint Gazprom-Eni SpA project, is designed to travel under the Black Sea from Russia to Bulgaria, where one of its branches will take a similar route as Nabucco. (, Bg)