Gazprom and Shell discuss ongoing and future cooperation

A working meeting between Alexey Miller, Chairman of the Gazprom Management Committee, and Ben van Beurden, Chief Executive Officer of Shell, took place in St. Petersburg on 28 April.

The parties addressed the prospects for collaboration between the companies under the Agreement of Strategic Cooperation. An emphasis was placed on a potential asset swap.

The meeting reviewed the ongoing front end engineering design (FEED) process for the third production train of the LNG plant within the Sakhalin II project. The participants also discussed in depth the progress of the Nord Stream 2 project.

Background

On 18 June 2015, Gazprom and Shell signed an Agreement of Strategic Cooperation. The document provides for the partnership between the two companies across all segments of the gas industry, from upstream to downstream, including in the form of a potential asset swap.

An LNG plant was brought into operation as part of the Sakhalin II project. It is the only LNG plant in Russia. The Sakhalin II operator is Sakhalin Energy Investment Company Ltd. (Gazprom – 50% plus one share, Shell – 27.5% minus one share, Mitsui – 12.5%, and Mitsubishi – 10%). On 18 June 2015, Gazprom and Shell signed a Memorandum to construct the third production train of the LNG plant.

On 4 September 2015, Gazprom, BASF, E.ON, ENGIE, OMV and Shell inked the Shareholders Agreement to construct the Nord Stream 2 gas pipeline system with the annual capacity of 55 billion m³ from Russia to Germany across the Baltic Sea.

Adapted from press release by Rosalie Starling

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