BP to sell a stake in its Russian venture

BP SAID it would press ahead and sell a stake in its Russian venture, dismissing a threat by its billionaire partners to block a deal that would enable the Kremlin to tighten its grip on the country’s vast energy sector.

The British oil major said last week it would pursue a sale after receiving expressions of interest in its one-half stake in TNK-BP, Russia’s third largest oil producer.

Analysts say BP’s shareholding is worth $30 billion.

A successful sale of TNK-BP to the state would raise the government-controlled share of Russia’s oil output to half and strengthen Vladimir Putin’s grip on strategic natural resources weeks after his return to the presidency. It would also sideline the four billionaires in the AAR shareholder consortium who thwarted an earlier tie-up between BP and state company, Rosneft, Russia’s largest oil firm.

“We have a contractual right to sell,” a BP spokesman said in response to a report that AAR would seek to veto any deal.

BP’s announcement triggers a clause in the TNK-BP shareholder agreement that allows it to negotiate a sale with any buyer within 135 days, say sources familiar with the matter. During an initial period, AAR would have the right to express an interest in buying or not. That would be followed by good-faith negotiations during which BP would also be able to hold talks with other possible buyers.

A spokesman for BP dismissed a report in the Financial Times that the shareholder agreement barred BP from giving out any confidential information to a third party without its consent, effectively handing AAR a veto right over any deal.

A source close to AAR said it was considering buying the stake.

In a further twist yesterday, a Russian court ordered a new hearing into a $13 billion lawsuit brought against BP by minority shareholders in TNK-BP over the failed BP-Rosneft deal, a BP lawyer said.

The Federal Arbitration Court in the Siberian city of Tyumen has sent the case to a lower court, lawyer Konstantin Lukoyanov said, adding the decision “inflicts substantial damage on Russia’s investment climate”. No date was set for the hearing.

AAR has denied being a party to the minority lawsuit.