Moscow: Russia’s biggest oil firm Rosneft on Friday called “very interesting” a proposal from BP to take an equity stake in a deal that could see the British group quit its troubled TNK-BP joint venture.
The comments by Rosneft CEO Igor Sechin — the right-hand-man of President Vladimir Putin on energy — intensified expectations that Rosneft will acquire the 50 percent stake BP wants to sell in its lucrative Russian business.
The announcement came just a day after reports said Rosneft was seeking a $10-15 billion loan to buy BP’s half of a lucrative but fractious company it runs with some of Russia’s best-connected and most powerful businessmen.
“We think this is a very interesting proposal,” Sechin told reporters at a company board meeting in the Black Sea port of Sochi.
The Russian oil champion and BP last year tore up a $16 billion share swap and joint Arctic oil exploration agreement after it was successfully challenged by the TNK-BP oligarch shareholders who wanted the deal for themselves.
The venture pays BP billions in annual dividends and was last year responsible for about a quarter of its oil output.
But it has also been the source of constant board battles and a drag on the company’s stock because of occasional interventions from the Russian state on the side of the billionaires.
The sale by BP of its entire TNK-BP stake for cash and shares in Rosneft could bolster its shaky standing in the world’s largest oil producing country and give it potential access to coveted Arctic oil.
Putin unexpectedly received BP’s chief executive and chairman for closed-door talks this week that Sechin said included a formal proposal from the British firm to swap shares under a TNK-BP buyout arrangement.
Sechin did not directly address the swap possibility while admitting that his firm was looking at “market mechanisms” that could ease through a deal in which BP could end up holding about 12.5 percent of Rosneft’s shares.
But he stressed that the two sides would not be pressed into immediate action by market expectations — ones fuelled in part by Putin’s own announcement that Rosneft would welcome foreign partners at this stage.
The Vedomosti business daily reported that the government had still not approved the share swap idea because cabinet liberals wanted to keep Sechin from expanding the state’s sway over the private oil sector.
A deal would represent a triumph for BP after a year in which it saw its biggest competitors — from Texas-based ExxonMobil to Italy’s ENI and Norway’s Statoil — strike big deals to develop some of the world’s most sought-after sections of the sea.
Rosneft had 12 offshore fields to licence in recent months and has decided to select foreign partners who have not only the experience and technology but also financing and their own global assets to offer in return.
It has already awarded seven contracts and has only two Arctic lots left in separate sections of the Barents Sea.
The possibility of losing out on those last offers and then leaving its TNK-BP venture would have been a brutal blow to BP chief Bob Dudley after a decade of tireless efforts to build better Kremlin relations.
The British group reaffirmed on Friday that “BP is considering further investment in Russia regardless of who we sell our stake to.”
“Therefore if we are successful in selling our stake in TNK-BP then we would be interested in investing some of the proceeds in buying shares in Rosneft,” it said in a statement.
Rosneft meanwhile announced agreeing with state energy export monopoly Gazprom — the only other company with rights to Russia’s Arctic energy fields — a plan to “jointly operate offshore field development infrastructure.”
The announcement came the same day number two producer Lukoil became the last major Russian private oil company to concede that it stood no chance of joining forces with Rosneft in the north.
“We have halted our negotiations,” Lukoil chief executive Vagit Alekperov told reporters in Sochi.