Global chemicals major BASF and Russian baron Mikhail Fridman-owned business conglomerate LetterOne have agreed to merge Wintershall and DEA, their respective oil and gas wings, to form a joint venture focussed on expansion globally.

Wintershall, which has been working with Abu Dhabi National Oil Company (Adnoc) since 2010, last month announced completion of its first offshore well in Abu Dhabi – a key development in its pilot project with the Gulf major to appraise the Shuwaihat sour gas and condensate field. The SH-6 well was spudded 5 kilometres off the coast of Shuwaihat island in the UAE’s waters.

With the formation of Wintershall DEA – the name by which the merged entity would operate –  now imminent, the exploration and production (E&P) company strengthens its prospects in the Mena oil and gas market, and boosts its chance of attaining permanent operator status of the Shuwaihat field from Adnoc.

The oil and gas business of BASF consists of Wintershall Holding and its subsidiaries, including the gas transportation business. The oil and gas business of LetterOne comprises DEA Deutsche Erdöl and its subsidiaries.

In the medium-term, BASF and LetterOne intend to float Wintershall DEA through an initial public offering.