BP to sell stake in Russian oil firm
Following ‘unsoliciated indications of interest’, BP announces plans to sell its 50 per cent stake in Russian oil company TNK-BP in a move which could net it £25bn.
TNK-BP, which is among the top 10 privately owned oil companies in the world, was built from the merger of BP’s Russian oil and gas assets and those of four tycoons in the Alfa, Access/Renova group (AAR).
BP has notified AAR of its intention to sell its stake after receiving “unsolicited indications of interest” regarding the shareholding.
Shares in BP rose almost five per cent in early trading.
BP declined to name the would-be buyers, but Russia’s influence over the domestic energy is such that state-backed players such as Rosneft and Gazprom are likely to be among the favourites.
In January 2011, Rosneft took a 5 per cent stake in BP, in the first major deal for BP since the Gulf of Mexico oil spill disaster.
Following the Gulf spill, BP agreed to set up a $20bn spill response fund.
‘Hostile’ response
News of the TNK stake sale comes in the week that one of the AAR billionaires, Mikhail Fridman, said the 50-50 ownership structure no longer served the interests of each party.
Having announced his resignation as chief executive on Monday, Mr Fridman told Russian newspaper Kommersant: “Everything is possible and realistic. We are open to proposals. There are a lot of different options.”
Shortly after the venture was formed, Russia became more hostile to foreign and private sector investment. The Kremlin’s preference to reserve larger fields for state-controlled groups has limited TNK-BP’s ability to expand in Russia.
BP and Russian oil company Rosneft last year offered to buy out AAR for about £20bn as part of an attempt to salvage their Arctic exploration tie-up, which AAR had blocked.
TNK-BP is Russia’s third largest oil producer.
It was formed in 2003 when BP merged its Russian oil and gas assets with those of AAR.
The joint venture also has operations in Ukraine, Brazil, Venezuela and Vietnam.