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. Last Updated: 07/27/2016

Gazprom Gets 50% Stake in Austrian Hub

Gazprom will take a 50 percent stake in OMV's Central European gas hub in Austria, giving it greater access to the continent's customers.

An agreement was signed Friday between OMV and Gazprom, which already supplies gas to the hub, Alexander Medvedev, Gazprom deputy chief executive said in a statement.

"We are once again demonstrating the tremendous contribution Gazprom is making in securing Europe's natural gas supply," Medvedev said.

Gazprom, which supplies one-quarter of Europe's gas, wants greater access to Western Europe's retail and distribution networks. OMV's Baumgarten gas hub, which Medvedev pledged to make continental Europe's largest, would become the terminus for two rival pipelines through southeast Europe, one planned by OMV, the other by Gazprom.

"Whichever channel this gas takes to get to Europe, Gazprom clearly wants the infrastructure that will get it closer to the customer," said Steven Dashevsky, co-head of equities at Moscow-based UniCredit Aton.

The facility last year handled 17.8 billion cubic meters of gas and is Europe's third-largest gas, according to OMV.

The OMV-led Nabucco link is intended to diversify European supplies by tapping into gas from the Caspian region via a pipeline from Turkey through southeast Europe. South Stream, a joint Gazprom-Eni project, is designed to travel under the Black Sea from Russia to Bulgaria, where one of its branches will take a route similar to Nabucco's.