By SELINA WILLIAMS and JAMES MARSON
LONDON -- BP said Friday it aims to stay in Russia for
decades to come and could use some of the proceeds from the
potential sale of its stake in joint venture TNK-BP to increase
its holding in Russian oil giant OAO Rosneft.
BP said it wanted to continue its investments in Russia
regardless of whether it sells its 50% stake in TNK-BP to
Rosneft or to the group of Soviet-born billionaires who own the
other half of the joint venture.
The comments illustrate the UK-based energy companys
desire to retain a significant presence in oil-rich Russia,
despite a plan to exit the turbulent, yet highly profitable
TNK-BP joint venture.
Completion of such a deal would also be an important
achievement for BP CEO Bob Dudley, who saw a landmark 2011 pact
with Rosneft to explore for oil in Russia's Arctic thwarted by
the TNK-BP partners.
TNK-BP is Russias third-largest producer of crude oil
and has contributed a significant proportion of BP's earnings
since its creation in 2003.
But the joint venture has also been a source of great
turmoil for the UK company because of long-standing
disagreements with the billionaire partners who control the
other half of TNK-BP through the Alfa Access Renova consortium,
BPs commitment to Russia follows a meeting Tuesday
involving Mr. Dudley, BP chairman Carl Henric Svanberg, Rosneft
CEO Igor Sechin and Russian President Vladimir Putin.
If we're successful at selling our stake, wed be
interested in buying a share in Rosneft, a BP spokesman
said. BP already owns 1.3% of Rosneft.
We are pleased with BP's decision to reinvest part of
the funds from the sale of its stake in TNK-BP in new projects in Russia, including in
Rosneft shares, Mr. Sechin said earlier Friday, according
to a report by Russian news agency Interfax.
Mr. Sechin added that Rosneft could raise the cash to
acquire BPs stake in TNK-BP on capital markets.
Analysts have said that Rosneft could pay for the stake,
which is worth an estimated $25 billion, with a mix of its own
shares and cash.
Rosneft could pay $10 billion to $15 billion in cash for
BPs stake in the joint-venture and the rest in shares,
resulting in BP acquiring at least a 12.5% stake of Rosneft,
Russian newspaper Kommersant reported this week.
The BP spokesman said that talks on the sale of its share of
TNK-BP are continuing and it isn't definite that Rosneft will
be the buyer or how a final deal might look.
BP is also talking to AAR, which has expressed an interest
in acquiring some of BPs stake in the company. BP is
obligated under its agreement with AAR to negotiate in good
faith for a period of 90 days that started on July 18, after
which it can sell to whomever it chooses.
AAR has some history with Rosneft. The consortium blocked in
the courts plans for a broad alliance between BP and Rosneft
that would have seen the two companies swap share holdings in
each other and jointly explore for oil in the Arctic.
Dow Jones Newswires