October 3, 2018 / 9:34 PM / a year ago

UPDATE 2-Austria's OMV to buy Siberian assets from Gazprom, not swap them

* Firms give in to opposition from Norway

* Purchase price still subject to negotiation

* Gazprom was keen on North Sea know-how (Adds details, background, quotes)

By Kirsti Knolle

VIENNA, Oct 3 (Reuters) - Austrian energy group OMV said it had agreed to buy Siberian gas assets from Gazprom instead of swapping them for some of its own assets, giving in to opposition from Norway to the initial plans.

OMV agreed in 2016 to swap 38.5 percent of its Norwegian assets for 24.98 percent of the Russian company’s Achimov IV and V phase development in the Urengoy gas fields. It had hoped to seal the deal by the end of this year.

However, sources told Reuters in May that the Austrian group might buy the assets outright after Norway criticised the plan to give Russia’s largest natural gas producer access to its continental shelf.

“The ‘basic sale agreement’ replaces the ‘basic agreement’ concluded between OMV and Gazprom on December 14, 2016,” OMV said in a statement.

The purchase price will be “negotiated in good faith”, it said.

Of the 10 billion euros ($12 billion) set aside for acquisitions to 2025, OMV has so far spent 2 billion.

It is also negotiating the price for its planned purchase of a 50 percent stake in Malaysian Sapura Energy Bhd’s upstream business.

Last year, OMV paid 1.75 billion euros for a stake in the Yuzhno Russkoye field, one of Russia’s largest gas fields, which added 100,000 barrels of oil equivalent (boe) per day to its production.

In 2016, OMV said that the Siberian Achimov assets would add more than 80,000 boe per day by 2025. For OMV, production in the area is cheap and pipelines to Austria are available.

The Austrian group is one of Gazprom’s partners in building the new Nord Stream 2 gas pipeline, which is planned to double Russia’s capacity to pipe gas across the Baltic Sea to Europe.

The original swap deal would have allowed Gazprom access to technological know-how in Norway.

However, OMV managers have said that Gazprom will benefit just as much from OMV’s technological expertise in developing the fields in Russia.

Once a purchase price has been agreed, the deal will be subject to regulatory and corporate approvals. The signing of the final transaction documents is expected early next year. (Reporting by Kirsti Knolle Editing by Kirsten Donovan and Rosalba O’Brien)

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