The two firms agreed to jointly develop the Yuzhno-Russkoye gas field in western Siberia and to develop a Baltic Sea pipeline.
The agreement would make BASF the first German company to obtain access to Russia's enormous gas reserves. The Yuzhno-Russkoye deal includes an investment worth $1 billion, while the Baltic project will be worth another $2 billion, BASF CEO Jurgen Habrecht said.
"This marks the transition to a completely new way of cooperating," said Putin, adding the BASF-Gazprom project would help to stabilize energy supplies in Europe.
Celebrity Families of 2014 [PHOTOS]