* BASF unit to see higher international oil, gas production
* New target for 160 million barrels oil equivalent by 2015
* Gas sales, profits to fall in German core market
* Lambasts political indecision over German shale gas
KASSEL, Germany, March 12 (Reuters) - BASF's oil and gas subsidiary Wintershall plans to increase production this year and expects higher profits as a result, after posting record figures for 2012.
Wintershall published a new long-term production target of 160 million boe by 2015, compared with the 144 million boe it produced in 2012.
The Kassel-based company provides the world's biggest chemicals group with oil and gas from its own fields, giving it an advantage over rivals such as Dow Chemical and DuPont which have no production of their own.
Wintershall Chief Executive Rainer Seele told reporters on Tuesday there would be higher oil and gas output from its main regions in Norway, Russia and Argentina in 2013. New finds in the Middle East and a return to pre-war oil output levels in Libya also gave him reason for optimism, he said.
BASF's group results for 2012 were reported on Feb. 26 where Wintershall contributed 44 percent of BASF earnings before interest and taxes (EBIT).
Wintershall did not give further detail on its separate oil and gas output in its annual press statement on Tuesday.
"The aim is to raise turnover and profits again in 2013," Seele said. "We want to grow."
Wintershall reported turnover of 16.7 billion euros ($21.7 billion) in 2012, up 39 percent from 2011. Earnings before interest and taxation (EBIT) in 2012 were 3.9 billion euros, 85 percent up from a year earlier.
Oil production in Libya has recovered to 85,000 barrels a day (bpd) and Wintershall wants to get back to the 100,000 bpd of output it achieved before the war.
Seele said Wintershall was able to tap oil and gas in 10 out of 20 appraisal drilling operations last year, including the oil finds Skjarfell in Norway and F17 in the Dutch North Sea. This is well above rates seen of up to 20 percent at other companies.
It has struck a deal with the Abu Dhabi and Argentine governments for assessments and further explorations and just reported a gas find in Qatar.
Last October, it agreed to swap oil and gas assets with Norway's Statoil in a deal aimed at helping both firms to share in the potential for large new discoveries.
Wintershall's outlook for its three gas trading units and its gas storage unit was marred by a fall in gas demand in Europe, Seele said. He expected weaker sales albeit from a strong level in 2012.
Sales at the three units rose 13 percent last year to 471 billion kilowatt hours. Gas sales inside Germany increased 23 percent to 226 kWh, underscoring the company's position as the nation's second largest gas supplier after E.ON.
Seele criticised scepticism in Germany about fracking technology which aims to unearth unconventional gas resources called shale gas, warning the country could fall behind in international competition.
Fracking involves pumping water and chemicals at high pressure through drill holes to prop open shale rocks and release trapped gas. German opposition is focused on the risks to drinking water in a densely populated country.
Wintershall has been using fracking for its production of conventional gas for over 30 years inside Germany but shale fracking permits were suspended in mid-2011 as the possibility of environmental damaged is being discussed at political level.
"Whoever puts a proven technology such as hydraulic fracking under a general ban, damages Germany as an industrial location," Seele said.
Shale gas has dramatically changed the global energy supply and price landscape over the last few years after the U.S. launched the process on a large scale, boosting its economy.