Austrian energy group OMV has agreed to buy a stake in one of Russia’s largest gas fields for 1.75 billion euros (US$1.85 billion), a major expansion push that gives previous owner Uniper a badly needed cash injection.

The transaction is expected to close by the end of the year and will be retroactively effective as of Jan. 1, 2017, OMV and Uniper said in two separate statements on March 5, adding cash on balance sheet would be added to the purchase price.

Sources had told Reuters last year that Uniper might put its 24.99% stake in Yuzhno Russkoye up for sale, expecting it to fetch between $1.7 billion and $2.5 billion.

“The acquisition will build a new core area, Russia, in our upstream portfolio adding 100,000 boe/d (barrels of oil equivalent per day) to OMV’s production," OMV CEO Rainer Seele said.

OMV said the deal would reduce the group’s production costs, adding it would be entitled to the field’s dividends starting 2017, with annual payments of about $200 million expected in the mid-term.

Yuzhno Russkoye, in which Gazprom and BASF’s Wintershall unit also have interests, has plateau production of 25 billion cubic meters a year and is the key source for the Nord Stream Pipeline, which supplies Germany directly with Russian gas.

OMV stated annual capex stood at just $20 million until the field’s license expires at the end of 2043, adding that the deal was still subject to co-shareholder consent and approval by Russian authorities.

For Uniper, which was spun off from German energy firm E.ON last year, the deal is a major step towards its goal of selling at least 2 billion euros worth of assets by 2018 to help it refocus its struggling business.

“Even after the sale of Yuzhno-Russkoye we will remain active in the Russian energy market where we generate roughly 5 percent of Russian electricity production through our majority stake in one of Russia's largest private generators, Unipro,” Uniper CEO Klaus Schaefer said.

“And our historic partnership with Gazprom will not be affected as we jointly continue to secure gas supplies to Europe for the next decades.”

(US$1 = 0.9428 euros)