BASF, Gazprom Sign MOU to Expand Nord Stream Pipeline

By Monica Houston-Waesch

FRANKFURT--BASF SE said it has signed a memorandum of understanding with Gazprom OAO to expand the Nord Stream pipeline bringing Russian gas to Europe, bypassing Ukraine.

The expansion will include two pipelines with the capacity to transport an additional 55 billion cubic meters to Germany, BASF said Friday.

The expansion will reduce Russia's reliance on sending gas to Europe via Ukraine. Disputes between the two countries have caused cuts in gas deliveries to the region twice in recent years.

BASF is joining other European companies in the expansion. In June, Gazprom said it signed a preliminary deal with Royal Dutch Shell PLC, E.ON SE and Austria's OMV AG to double the capacity of the pipeline that runs from Russia to Germany via the Baltic Sea.

"BASF and Gazprom have been cooperating for more than 20 years on the construction of pipelines to ensure secure supplies of Russian gas to Europe," said Hans-Ulrich Engel, a BASF executive board member.

The current pipeline is only running at around two-thirds capacity due to EU competition rules.

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