British supermajor BP says it is in talks with AAR over the sale of its stake in Russian venture TNK-BP.
AAR, the club of four Russian billionaires which already owns half of TNK-BP, has notified BP of its intention to buy all or part of the 50% share of TNK-BP it does not already own.
The notification triggers a 90-day formal “good faith” negotiation window under the terms of BP and AAR’s shareholder agreement for TNK-BP, according to a statement from BP.
“BP is also able to and will enter into negotiations with other interested parties in parallel for the sale of its share in TNK-BP,” said the BP statement. “There can be no guarantee that any transaction will take place.”
The TNK-BP venture accounts for 900,000 barrels a day, just over a quarter of BP’s total oil production, and the supermajor’s stake is thought to be worth $25-30 billion. BP paid $8 billion to buy into TNK-BP in 2003. AAR is reportedly seeking a heavy discount to BP’s share.
While lucrative, BP has had a rough time in the joint venture. AAR has previously attempted to sue BP for $16 billion over an abortive tie-in between BP and Russian state energy company Rosneft. BP’s offices were raided.
Current CEO Bob Dudley, then head of the JV, was subject to a campaign of harassment culminating in his sudden exit from the country. Leaked diplomatic cables revealed Dudley suspected Igor Sechin, Russia’s deputy prime minister and chairman of Rosneft, was behind the campaign.
Assuming BP sells up, it is thought the company will reinvest in Russia.
