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AAR seeks to halt BP Rosneft strategic alliance

Published time: January 28, 2011 08:30
Edited time: January 28, 2011 14:04

BP’s partners in the Russian British oil producer, TNK-BP, have applied to halt BP’s share swap and strategic global alliance with Russian oil producer Rosneft.

AAR, which represents the Russian shareholders in TNK-BP, including Viktor Vekselberg, German Khan, and Mikhail Fridman, applied to a commercial court in London on Wednesday, with a preliminary hearing scheduled for February 1. BP spokesman Vladimir Buyanov has confirmed that the company has received the application but declined to comment on its specifics.

The move comes after BP agreed to swap a $7.8 billion stake in the company for 9.5% of Rosneft as part of its drive to maintain production in the Arctic.When the announcement was made AAR noted that BP would require a waiver from the TNK-BP board before it could follow any new opportunities in Russia not involving TNK-BP.

AAR claims BP’s alliance with Rosneft violates the shareholder agreement behind TNK-BP, which states that either side must pursue new projects in Russia or Ukraine exclusively through the joint venture. AAR says the agreement stipulates that either side must forward new ventures for the review of TNK-BP’s board.

Richard Swann from Platts says theBP Rosneft agreement has been presented to TNK-BP as a fate accompli, and that this underlies the legal suite.

“This is a legal claim lodged in London, and it goes right to he heart of what is TNK-BP.There is a lot of money tied up in TNK-BP, and if TNK say they have a right to what BP now wants to do with Rosneft, that is a serious liability.Not the end of the road for BP, but it’s a serious roadblock.TNK-BP thinks it has the right to anything first, anything BP wants to do in Russia, according to their suite, they are meant to run by TNK-BP first, giving them the right to first refusal. They didn’t get that here.They were presented with the Rosneft deal as pretty much a fait accompli.”

In 2008 a protracted shareholder dispute between BP and AAR over the management of TNK-BP saw then TNK-BP CEO, Robert Dudley, who has since become head of BP, depart the company.

Aleksandr Levinsky, a reporter from Forbes Russia, expects that memories of that dispute will see AAR push hard.

“After the victory in 2008, when Dudly wasn´t allowed into Russia, and when they had an upper hand in TNK – BP, now they feel offended and they feel that the State doesn’t protect their business interests. So, I think, they will be very active in this situation.”

However, Igor Sechin, the head of Rosneft's board, speaking in Davos at the World Economic Forum, said the link up between BP and Rosneft was within the framework of the agreement between BP and AAR over the management of TNK-BP.

“We've consulted with our partners from BP. And their opinion is that they acted within the law. Any questions, if they arise, should be resolved through the legal instruments and we don't see any problems. If BP has additional opportunities in Russia – to develop onshore projects with TNK BP and offshore projects – with Rosneft. I think that's good.”

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